POWER March 2017 - 64

COMMENTARY
Progress on GHG Emissions
Reduction in Canada's
Electricity Sector
Graham Campbell
educing emissions from the electricity sector continues as
a primary transformational goal of government policy-makers,
and the private and public companies managing electricity
generation in Canada. Impressive progress has been made.
R
National Overview
Emissions from electricity generation made up just 11% of Canada's
total in 2014. Over 79% of generation is non-emitting:
hydropower (63%), nuclear (13%), and renewables (3%).
More significantly, emissions from generation have been declining
steadily from 120 million metric tons (Mt) in 2000 to 78
Mt in 2014. Complete elimination of coal-fired generation from
Ontario's generation mix and lower demand due to the 2008 economic
downturn have been primary contributors.
GHG Mitigation Policy-National and Provincial
Canada has implemented the full spectrum of climate policy tools:
carbon regulation, carbon pricing, cap-and-trade regimes within
Canada and linked to U.S. markets, significant investment in new
technology, and policy directives to green the generation mix.
In October 2016, the federal government announced plans to
implement a pan-Canadian carbon tax, beginning in 2018. Each
jurisdiction will be able to choose between a direct price on
carbon or a cap-and-trade system. All revenues will flow back to
the province or territory.
Canada's provinces have the lead role in all things related to
energy in keeping with their constitutionally assigned ownership
of resources within their boundaries. Not surprisingly, a variety
of emissions reduction policies have emerged; separate pathways,
but with a common goal.
In 2009, Nova Scotia established greenhouse gas (GHG) emissions
regulations imposing caps on the electricity sector. As of
2014, Nova Scotia had already reduced emissions 17% below
1990 levels, and it was on track to reach 24% by 2020. An internal-to-Nova
Scotia cap-and-trade system will retain revenues
and GHG reductions within the province.
In Ontario, elimination of coal-fired generation was set as a provincial
policy goal in 2004, driven by health concerns. Coal-fired
generation was eliminated in late 2014, North America's single
largest emissions reduction initiative. The 2009 Green Energy and
Economy Act provided for a succession of feed-in-tariff programs
incenting renewables, which now contribute 6% of generation.
To sustain nuclear power's 60% share of generation, plant refurbishments
are in progress. Refurbishment of the four units at
Bruce A was completed successfully in 2012. Refurbishment of
the remaining units will commence in 2020. At Darlington, work
is now underway on a ten-year project to refurbish its four units.
Ontario's cap-and-trade program came into effect in July 2016,
linked with California and Québec.
64
Following implementation of a sophisticated carbon regulation
regime in 2008, a first for Canada, Alberta launched its Climate Leadership
Plan in November 2015. Features are complete phase-out of
coal-fired generation by 2030, to be replaced by generation from
renewables and natural gas, and a target of 30% from renewables by
2030. Of the province's 18 coal-fired plants, 12 are scheduled to be
taken off-line before 2030. An agreement has been reached between
three of the remaining plants and the Alberta government to compensate
owners for taking their plants off-line by 2030.
Marking recent technological progress are new electricity storage
services in Ontario, based on a variety of storage technologies.
Saskatchewan's world-first CO2
capture facility at SaskPower's
Boundary Dam plant began operation in late 2014, integrated with
use of the captured CO2
to enhance oil production at a neighboring
oil field and disposal of the remainder in a deep geological
formation. To facilitate interprovincial electricity trade, increased
interconnection capacity has been installed between Québec and
Ontario, and is being considered in other regions as well.
The Path Forward
Do issues remain? For sure: increases in electricity prices, meeting
Canada's 2030 target, and uncertainty about energy trade
have emerged as critical issues.
The recent increase in electricity prices has become a hot button
issue in jurisdictions in the midst of greening their generation.
Expect electricity prices to remain a political issue.
Second, there is a significant gap to be closed to meet Canada's
national target of a 30% reduction in emissions relative to
2005 levels by 2030. According to government projections, annual
emissions will at best remain flat at roughly 750 Mt to 2030.
To reach the 2030 target, emissions will need to be reduced to
524 Mt, a decrease of more than 225 Mt. Recently-announced
policy actions will certainly help meet Canada's national target.
The impact of the emerging energy policies of the U.S. administration
on Canada is unknown at the time of writing (midJanuary
2017). Energy markets connecting Canada, the U.S., and
Mexico are highly integrated and mutually beneficial.
In addition to the generation story, we will see greater electrification
in end-use sectors, particularly in transportation, and
the beneficial impacts from utilities' investment in decentralized
generation, smart grid networks, and demand side management.
In closing, Canada's electricity sector has already made a substantial
contribution to GHG reductions, and it will continue to
do so as recently announced policies and further actions by electricity
providers and distributors roll out. ■
-Graham Campbell is president of the Energy Council of
Canada, which works with members from all energy sectors, and
the federal and provincial governments, and serves as Canada's
representative to the World Energy Council.
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POWER March 2017

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