Marginal increase in power demand enough reason for Muskrat?

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By Maurice E. Adams In a June 29 letter to the editor, “Clearing up some misconceptions about Muskrat Falls, Rob Henderson, vice-president of Newfoundland and Labrador Hydro, wrote that electricity “consumption has been steadily increasing, except for the 2005 through 2009 period, which was impacted by the declining electricity consumption for provincial pulp and paper production”. However, Nalcor’s own 2011 info-graphic (which can be seen at www.vision2041.com/demand.html ) shows that the island’s actual “Total System Load” went down not only during the 2005 to 2009 period but a total of 10 times over the 16 year period from 1994 to 2010 (additional years 1994, 1996, 1998, 2001, and 2004). Over the entire 18 year period (1994 to 2012), electricity consumption went down more often than it went up (10 of the 18 years), so that by 2012 the island’s electricity consumption was still below 1993 levels. Furthermore, when Henderson wrote that “In addition, it is important to note that peak demand on the island, or highest amount of electricity required at a given time, is also rising,” it should also be noted that in 2010 NL Hydro’s forecast peak demand for year 2012 (just two years into the future) was more than five times higher than year 2012’s actual increase and that actual peak demand in 2012 was still down considerably from the island’s peak demand 10 years earlier (1,550 megawatts, down from 1,592 megawatts in 2002). Accordingly, when the facts show that over the longer term (the 18-year period from 1994 to 2012) consumption went down (not up) 56 per cent of the time and that by 2012 electricity consumption was still below 1993 levels, what does that say about the credibility of Nalcor’s Muskrat Falls’ business plan when NL Hydro grasps at a marginal increase in demand over a two or three year period as a basis for its claim that “in fact (electricity) consumption has been steadily increasing”? A credible position? You be the judge. Maurice E. Adams writes from Paradise

Organizations: Newfoundland and Labrador Hydro, System Load

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  • Winston
    August 06, 2013 - 12:18

    BC, the peak demand figure for the last 2 years suggest a rise of 13 MW per year instead of 20, which is 35 percent less than forecast.... a considerable reduction. Holyrood production is now only about 10.5 percent of our total, down from 30 percent a decade ago. And at present we have a lack of capacity to get all our hydro to the Avalon. Nalcor proposed to the PUB a third transmission line from central to the Avalon. costing 200 million, and has delayed on this. If this was in place Holyrood production would we substancially reduced from it's current level, but they have priority on burning oil rather than this third line!

    • BC
      August 06, 2013 - 18:55

      It's a great trend to see, a drop in per-capita use, the less use we get out of Holyrood, the better! Hopefully sustained, but a sample of a few years isn't enough to place bets on (the transmission I completely agree - should have been upgraded years ago). I'm afraid I don't share your optimism about heating futures though. By example, I'm living in a quite energy inefficient house as it is now... but to move to a new house, my heating bill will still go up - these new builds might be as much as 60% more efficient with all the bells and whistles, but on average 50% larger than a house than older stock and over triple the size of my little coastal shack. In an old, colder house as mine is, one accepts the cold as you can't beat it - but in a newer house people are less likely to go about in sweaters and curl under blankets just to watch TV. By my own observation, friends in less drafty abodes do keep them pretty warm, and universally so - kitchens, bathrooms, all the rooms - they are never kept just warm enough to keep the pipes flowing, as mine is. It's like TV's: a modern flatscreen TV is much more efficient than a CRT, but a 50"-55" is about as common and draws about the same power today as a floor model 19-21" did in 1989. Efficiency gains.. they are fleeting. So much as these are ancedodal examples, it's something more broadly seen in history (jevons paradox) & probably why (aside from decreased home oil) we haven't seen much benefit from out-migration, minor but broader propane and pellet use, and better insulation these last 20 years. Generally warmer winters have the opportunity to reduce off-peak overall consumption in the winter, yes, but we'll see that rise in the summer as well once it gets hot enough for broader adoption of air conditioning... and cold & windy days, they won't go away, climate change predictions are about average temperatures, not maximums & often forecast worse storm events .. so peak use may even increase. If the folks in BC haven't be able to avoid the perils and intrusion of smart meters/supply management and other such annoyances, it doesn't look good for our relatively poor province to keep consumption from rising on the basis of conservation or efficiency! (granted, they have an entirely different issue with power borders there).

  • Maurice E. Adams
    August 05, 2013 - 14:33

    I am content, BC, to let the facts speak for themselves. It was and is not my intent to suggest that these facts alone should be interpreted (or should in any way represent) an acceptable method of forecasting. I leave the specious arguments and half truths to others.

  • Winston
    August 05, 2013 - 13:06

    BC, I agree that Maurice's view is slanted to disregard the effect of the loss of industrial demand over the years. But that being said, the industrial loss is now behind us. Commercial demand is rather predictable, and doesn't increase much, and the elephant in the room for forecasting is the residential, which, according to Nalcor, is forecast to increase due to winter heating loads. 90 percent or more of these loads are serviced by Nfld Power, and so Nalsor used their forecasting method ( which is acknowledged by MHI not to meet best method standards.) Their forecast is a demand increase of about 1.3 percent per year for the next decade and then to taper off some. At a present peak demand of about 1550MW, this gives some 20 MW of demand increase on average per year. From 2010 to 2013 we see a demand increase from 1544 to 1570 , an average increase of 8.6 MW per year, and being about 0.5 percent demand increase per year. This is less than half the forecast demand increase for this period. This period is past the influence of industrial demand decline and is therefore critical as what is happening, and at a time when housing starts have been at a record high. And now, for 2013, we have much higher new house efficiency standards (using 27 percent less energy) and cost effective opportunities for efficient heating systems for both new and older houses (able to reduce winter energy by 60 percent). And also, there is the added benefit of warmer winters for Nfld, as recently reported by MUN geography professor. The impact is reflected in the reduced demand for Holyrood production. I would refer you to Maurice's chart for this, the centre chart under the Holyrood Heading, or scroll to May 2 NEWS heading. This shows the Holyrood production forecast with what is actually happening since 2010, which is very troublesome I suggest. Now Nalcor suggest this past year is a fluke of just extra rainfall, and some wind generation benefit. Extra rain helps, and even this is predictable from climate modeling. But the trend for Holdrood production continues downward for the last few years when it is supposed (according to Nalcor) to go up. This downward trend for Holyrood production is to be expected given a peak system demand increase that is less than half of that forecast. Surely this is not surprising. Nalcor and Nfld Power both neglected to appropriately consider the drivers on demand mentioned above, and these will have more influence going forward. And when demand is increasing at only one half of one percent instead of at 1.3 percent, it's a different ballgame as to how easy, and cheap, it is to cut the demand increase to zero. And critics have argued that Nalcors demand forecast was aggressive, and this appears to be the case. Other jurisdictions are effectively cutting demand increases to zero doing with cost effective efficiency and conservation plans that prevents large increases in electricity rates for customers. So the heading of this article is good one. Is the marginal increase in demand enough reason for Muskrat? The fundamental reason for Muskrat was to satisfy our winter heating load. Seems we can do this without Muskrat, at a much cheaper cost. And lets define what 'marginal ' means. When we're talking one half of one present, it not a very difficult problem. Does one half of one present need a 10 billion dollar solution? I think not. This meagre power demand need has for too long been glossed over. It's past time it was seriously assessed. The forecast is fatally flawed, and yet it is so fundamental to our future financial well being.

  • Maurice E. Adams
    August 05, 2013 - 09:06

    BC ---- You may be looking at the wrong Vision2041 graph. The graph referred to in the above article is a "Nalcor-created" graph --- the 3rd one down on the left hand side of the page. It is this Nalcor graph that shows that demand has gone both up and down over the last 20 years and that by 2012 demand was still below 1993 levels. The same thing can be seen on the Nalcor graph you reference (it is essentially the same).

    • BC
      August 05, 2013 - 10:41

      Ah, yes, thanks, wrong graph indeed, though I believe the observation remains relevant. For most of the years between 1993 & 2012 levels, the level is higher. The drop into 2009 was drastic and driven by industrial curtailment - to rely on this for future projections is specious, there isn't that much industrial use left to shutdown. I can't reconcile this interpretation with any method of forecast I'd use either in my own profession, or even in entry level stats @ MUN.

  • BC
    August 04, 2013 - 14:46

    With all due respect, the linked graph is ridiculous. This short-term historical growth projection, as presented, requires there to be a trend of large consumer mill shut-downs, as well as the wholesale collapse of another fishery or two. By the same methodology, based on a 4-year history, consumers will be generating more than they consume by 2025. Compare the Vision chart to this Nalcor breakdown, over fewer years, which shows the impact of industry on hydro use: http://leadershipblog.nalcorenergy.com/wp-content/uploads/2012/04/Blog2_chart1.jpg ... I leave it to the reader to drawn their own conclusions as to the credibility of Vision 2041, on their own terms.

  • Reduce Demand Instead
    August 03, 2013 - 16:59

    The increase in winter demand is due to new homes with electric heat. We could slash that by 60% with heat pumps, eliminate it with solar or by using wood pellets. http://nlcpr.com/AvalonPowerDemand.php