Nalcor still targeting Ontario market for Lower Churchill power
© — Photo courtesy Nalcor Energy
The province hopes to develop Muskrat Falls as part of the potential Lower Churchill hydro megaproject. — File Photo
Ontario may have more hydro power than it’ll need as wind energy comes onstream in the next two years — potentially bad news for projects such as the $6.2-billion Lower Churchill development.
By 2013, more than 5,000 megawatts of wind energy are expected to be installed on Ontario transmission lines, according to reports issued last month by the Independent Electricity System Operator (IESO).
The result? Surplus power in Ontario.
Nalcor Energy has seen the reports. It calls Ontario’s wind energy integration woes an opportunity — and says it’s still eyeing the market.
“Our ability to integrate with wind is an important advantage for us,” said Gilbert Bennett, Nalcor Energy’s vice-president for the Lower Churchill project.
“There are times when too much wind is on the system and their market price collapses.
But the converse happens as well. When the wind is not blowing on a peak day, they actually can be short a lot of generation.
“That’s one of the important attributes of hydro projects ... like the Lower Churchill — we’re dispatchable.
“You can get the output from us when you need it, and we can ramp it up and ramp it down … in line with the market demand.”
IESO runs the Ontario power system.
It matches supply with demand and continually monitors the flow of electricity over transmission lines.
It’s predicting future surpluses.
“The IESO would experience surplus conditions roughly 14.5 per cent of the time based on average wind output,” said a December report.
On New Year’s Day, surplus power meant Ontario consumers were essentially paid to use electricity, according to a Jan. 20 article in the Toronto Star.
The IESO predicts surpluses could occur more frequently in the next two years — about one in every seven days.
Last month, it held consulted with the Ontario power industry on ways to integrate wind energy.
IESO said the “rapid deployment of renewables across the province” will fundamentally challenge” the Ontario power system — unless changes are made to the way wind energy flows onto transmission lines.
It noted that shutting down nuclear energy plants for a few hours or pre-emptively spilling hydro water are not cost-effective ways to accommodate surplus wind energy on the grid.
Bennett agrees the integration of wind energy with Ontario’s hydro transmission system will be a challenge.
“That’s where we can come in,” he said.
He also see opportunities in replacing some of the 12,000 megawatts of power generated by Ontario’s nuclear plants.
“Those are all Candu reactors. Some of them are coming to the end of their life.
“As a hydro project, we can ramp up, we can ramp down, or we can deliver firm capacity in energy just like a nuclear plant.
“With those attributes, we certainly see an opportunity to reach a bilateral agreement with Ontario the same way that the wind developers have.”
Bennett isn’t worried about surplus Ontario power exports to the U.S.
“We won’t be competing with each other. The market is just so big that I wouldn’t see that as a major problem.”
Demand for hydro is currently down in Ontario because of the recession, and Bennett expects that will continue for several years.
“I think, in the long-term, we’ll see demand pick up in Ontario,” he said “We’re taking a very long-term view with Lower Churchill.”