American electricity data – for a perspective on Ontario costs

Electricity prices, and costs are aspects of a project I’m trudging through working with electricity data from the United States. I’ve developed a Power BI report which probably deserves a lot slicker interface, but time is limited. This post offers directions on controlling the reporting, and adds some Ontario context to the graphics.

My primary intent was to create imagery of average monthly electricity cost, by state, for residential consumers. Rates get a lot of discussion, even more so in recent weeks, but I’m not convinced an isolated rate analysis is useful.

A recent Scientific American article featured a smart BI report by Abhilash Kantamneni ( @akantamn on Twitter ).

Dashboard 2

Due to an exchange on Twitter I’d had with Abhilash a couple of weeks ago, I wanted to build a view that showed both rates, and average monthly consumer costs – because it turns out these are much different things.

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Worthless and worse wind

My friend Parker Gallant has written on my updated estimates of annual curtailment in Wind waste should worry Ontario ratepayers.  Producing the estimates doesn’t take me nearly the effort Parker puts into writing on them, so I felt compelled to add a new view of the data just to make our contributions a little more equitable.

The French language Radio-Canada has posted AU PAYS DE L’EAU NOIRE
Des résidents en Ontario vivent un cauchemar depuis l’installation d’éoliennes proches de leur domicile. I assume it’s best read in French, but the Google translation to English sufficed for me. As the journalism at Radio-Canada is more focused on the impacts to people of turbine construction of the North Kent wind farm, I decided today’s show of data will be on the performance of individual industrial wind turbine facilities.

Capacity Factor is the output of a generator divided by the theoretical maximum (full output in all hours). To estimate costs I need to estimate curtailment, but just viewing the history of capacity factors has the benefit of allowing the cynical reader (ie. the good ones) to verify my claims just by adding up columns from the IESO’s wind file. I won’t make it easy to do though, because for fairness I limit results to years where a facility was in commercial operation throughout, and to compare 2017 results I’ve made all years’ data the total as of the end of November.

NovYTD_CFs

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Report shows Ontario ratepayers have paid $6 billion to dump electricity

Brady Yauch has produced a report, along with Scott Mitchnick, on the cost of selling electricity to exporters for less than it cost to procure the supply:

Ontario electricity customers have paid more than $6 billion to cover the cost of exporting the province’s energy surplus, according to a new study from the Consumer Policy Institute.

Over the last decade, Ontario customers have paid $6.3 billion to cover the cost of selling high-priced electricity to customers outside of the province, according to a new study by the Consumer Policy Institute. A majority of those costs – $5.8 billion – have come since 2009, as demand for electricity in Ontario has fallen, while more generation capacity continues to be added, creating a growing surplus that gets dumped at below-cost prices in places like New York and Michigan.

The quote is from the blog post; the full study is, Power Exports at What Cost? How Ontario Electricity Customers are paying more to dump the province’s excess power.

cpiestimates

The numbers match, almost exactly, my estimates using the same calculations I use in charting the cost of exports in my weekly and monthly reports. I recommend reading Yauch’s work because I find it very accessible – more than my own.

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The world’s worst electricity market

Forbes opens an article titled Ontario’s High Electricity Prices Are Bad For Business with this quote from Pierre-Olivier Pineau, Chair of Energy Sector Management at the University of Montreal:

“Ontario is probably the worst electricity market in the world”

Friday, April 8th, Ontario’s market provided more evidence supporting that premise.

This tale doesn’t involve surplus “baseload” or huge wind output or even particularly low demand. This tale involves the price of natural gas and the Ontario market’s inability to recover even that small fuel cost.

 

April8

The closing price of natural gas on the Dawn hub (in Ontario) on April 8 was $2.68/mcf. My quick estimation just multiplies that by 7.5 to calculate fuel cost of producing one megawatt-hour of electricity: about $20/MWh.

April 8th, like all days, saw most natural gas fueled electricity produced by non-utility generators, with 3 exceptions: Halton Hills, St. Clair and Thorld generating stations also operated, and until hour 19 (7-8 pm), they all generated electricity well below the fuel cost of generating electricity.Read More »

Wynne government reveals unintelligent carbon pricing

The press release begins:

To build on the work already underway to fight the effects of climate change, Ontario is laying a foundation to join the biggest carbon market in North America by introducing new legislation today that, if passed, would ensure that proceeds from the province’s cap and trade system are transparently reinvested into green projects and actions that will reduce greenhouse gas pollution.

There’s no shortage of people railing against any tax, but I’m not vehemently opposed to a carbon tax/price. Stéphane Dion launched his appeal for his Green Shift policy during 2008’s election campaign with:

The Liberal Green Shift plan is as powerful as it is simple: We will cut taxes on those things we all want more of such as income, investment and innovation. And we will shift those taxes to what we all want less of: pollution, greenhouse gas emissions and waste. 

I wasn’t opposed to that – I didn’t know it would accomplish much of anything, but a carbon tax instead of a payroll tax, or a beer tax, is not something I would get too worked up about. However, I have written on two objections to a carbon tax: the inability to price externalities, and the funding of thoughtless spending with revenues.

In stating,  “proceeds from the province’s cap and trade system are transparently reinvested into green projects ,” the Wynne government loses my confidence in their scheme.Read More »

Curtailment of industrial wind turbine production in Ontario soars in 2015

A 2015 year-end review of my hourly estimates indicate the curtailment of output from industrial wind turbines (IWTs) soared in 2015. I show total curtailment exceeding 1 million megawatt-hours, which I assume Ontario ratepayers paid ~$127 million for regardless.

I show the potential supply curtailed rising to 10% from 6%.

WindCurtailmentByRegion

 

The increase in curtailment in the Bruce region is galling as an examination of output from one IWT location there revealed that during the peak electricity demand of summer it was often a net consumer of grid power rather than a contributor to supply.

Note in the above graphic that only the Northwest breaks a trend that sees higher curtailment equate to lower market valuation of the output of the zones’ IWTs, with a doubling of curtailment in the Bruce region matched by a halving of market value of production.

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Wind Cronyism Wins; We Lose

Lisa Linowes, notably of the Industrial Wind Action Group, has a post on the now ensured extension of the Production Tax Credit for industrial wind in the United States.

The extension is, bizarrely, being reported as a compromise between those who want to export crude oil, and those who want rewards for righteous generation.

I think within a year this decision will result in the announcement that a couple of nuclear power plants in Illinois will close. The U.S. already seemed unlikely to meet its Copenhagen commitments, and I believe this announcement makes it less likely to do so.

I offer this story here as it relates to an original work I’ll be writing for my Cold Air blog.

Wind Cronyism Wins; We Lose

After all the drama in this end-of-year self-generated crisis, Congressional negotiators struck a deal on the omnibus spending and tax extender bills. In a nutshell – the democrats won, the republicans caved and the rest of us were screwed – unless, of course, you’re in big wind’s camp. In that case, you’re probably stunned at how much Congress is willing to give of taxpayer money so it can go home for the holidays.

Meaningless Gesture

After two weeks of bluster from both sides claiming the renewable tax credits posed the greatest obstacle to reaching agreement, we now know there was no debate at all. The wind industry secured its prized 2-year, $10 billion extension promised by the Senate Finance Committee with no questions asked. To appease the thousands of taxpayers who pleaded for the wind PTC to end, the backroom, spineless negotiators added phase-out language that would lower the credit in 20% increments after 2016.

The phase-out might sound reasonable but it’s meaningless and no different had the House agreed to the 2-year extension with no phase out. This time next year, big wind’s army of lobbyists will descend on Congress once again with a slightly modified ask i.e. to delay the phase-out reduction for a year, and another and another after that. We’ve all seen the movie before and the ending never changes…

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