June 13-20, 2005

Cleaner air, reliable power supply form basis of Ontario's plan to end coal-fired generation

Reliability of electricity supplies, together with improved air quality and protection of human health, are the cornerstones of Ontario's plan to replace coal-fired power generation with cleaner sources of energy and conservation.

The plan, made public last week, will follow up the recent closure of the Lakeview generating station with the shutdown of three out of the four remaining coal-fired facilities by the end of 2007. The last remaining station, Nanticoke, will close in early 2009. In addition to ensuring a safe margin of reserve supply, the government says its plan to replace coal-fired generation will not require an increase in imported electricity from other jurisdictions.

"We are leading the way as the first jurisdiction in North America to put the environment and health of our citizens first by saying 'no' to coal," said Energy Minister Dwight Duncan. "And as we have said all along, maintaining reliability is the first principle of our plan. It's a prudent and responsible path that will ensure cleaner air for the province."

Provincial Environment Minister Leona Dombrowsky pointed out that the plan "will reduce greenhouse gas emissions in Canada by up to 30 megatonnes a year, which is equivalent to taking almost seven million cars off the road or removing every car and small truck in Ontario. The closure of Ontario's coal- fired generating stations is expected to provide up to half of the province's greenhouse gas reduction contributions under the Kyoto Protocol," she added. (Thirty megatonnes a year is more than all the greenhouse gases produced by either Manitoba or New Brunswick.)

The Lakeview plant, representing 1,140 megawatts (MW) of generating capacity, was closed at the end of April, following completion of projects to strengthen the transmission system in the Toronto area (ELW May 2-9, 2005). Under the coal replacement plan, the Thunder Bay generating station (GS), representing 310 MW, will be replaced by gas- fired generation in 2007. The Atikokan GS, representing 215 MW, will close by the end of 2007, following the replacement of Thunder Bay units and necessary transmission upgrades; no direct replacement will be necessary.

The Lambton GS, representing 1,975 MW, will be replaced by the end of 2007 by two new combined-cycle gas-fired generating stations in the Sarnia area. Announced in April, they were part of the first group of projects selected as a result of the government's 2004 request for proposals for clean energy capacity (ELW April 18, 2005).

Finally, the Nanticoke GS-the largest facility, representing 3,938 MW-will begin closing units throughout 2008, with the last unit slated to close in early 2009. In addition to new generation capacity, transmission upgrades in southwestern Ontario are necessary for the closure of Nanticoke.

To support the replacement of coal-fired generation in Ontario, the provincial government has launched a series of initiatives which will ultimately yield well over 7,500 MW of cleaner, more diversified power.

Between 2004 and 2007, Ontario expects to secure more new generating capacity than any other jurisdiction in North America. This includes: Pickering A Unit 1 return to service (515 MW); clean energy supply and demand side projects (2,235) MW; Niagara Tunnel (200 MW); renewables RFP No 1 (395 MW); renewables RFP No 2 (1,000 MW); renewables RFP No 3 (200 MW); replacement of the Thunder Bay GS with gas-fired generation (310 MW); cogeneration (1,000 MW); downtown Toronto (500 MW); the western Greater Toronto Area (1,000 MW); and demand-side management and demand-response (250 MW).

The government is also reviewing a tentative deal with Bruce Power for the refurbishment of two laid-up nuclear reactors; these together represent more than 1,500 MW of additional capacity. If concluded, this agreement would further increase the total capacity from provincial initiatives to 9,145 MW.

Although the government originally pledged to end coal-fired generation in Ontario in 2007, the plan was commended by environment and healthcare experts as well as industry representatives. Jack Gibbons, chair of the Ontario Clean Air Alliance, said the plan makes sense to his organization. "While there is a delay for the complete phase-out of coal relative to the original forecast, we believe it is worth taking the extra time necessary to do the job right and ensure an orderly and sustained shutdown. The benefits for all Ontarians will be enormous and long-lasting," he observed.

Dr Anna Day, a respirologist at Sunnybrook and Women's College Health Sciences Centre in Toronto, said the plan "means a significant reduction in harmful airborne emissions, which will mean fewer cases of childhood asthma and better health for Ontarians."

"The phase-out of coal represents one of the most significant undertakings in the history of Ontario's electricity sector," said Dave Goulding, president and CEO of the Independent Electricity System Operator (IESO).

"The implementation of the government's plan to stop burning coal in 2009 recognizes the need to maintain reliability as coal-fired generation is phased out in favour of cleaner generating sources. The IESO is committed to working with the provincial government and others to ensure that reliability is not compromised during this transition period," he added.

Ontario's move to re-evaluate its coal shutdown commitments also received support from the Association of Major Power Consumers in Ontario (AMPCO), which had previously expressed to the government its concern that replacement generation capacity would not be ready by the original target date of 2007.

Mike Kuriychuk, head of AMPCO's board of directors, said the group continues to urge the Ministry of Energy to consider the combined heat and power potential of all new thermal generation projects in the province. "It's a wasteful practice to discard 50 to 70% of the heat in a generation process to the environment when much of it could be used for industrial processes or district heating. Cogeneration and district energy are central to a sound energy policy," he noted.

In order to ensure system reliability and to support the coal replacement strategy, Energy Minister Duncan has directed the Ontario Power Authority (OPA) to launch new procurement processes for additional power in the downtown Toronto core and the western part of the GTA, new demand-side management and demand response initiatives, and industrial co-generation and district energy projects across the province. The OPA will release further details on these processes, which will be launched by the fall of 2005.

The OPA has also been directed to begin discussions with the owners of seven underutilized electricity generators, sometimes referred to as "early movers," to increase the operation of the facilities at a reasonable cost to Ontario consumers.

Renewable energy will have an important role in creating new capacity, and the government is well on its way to meeting its target of adding 5%, or 1,350 MW of new renewable generating capacity by 2007. By the end of 2007, it is expected Ontario will see a 75-fold increase in its wind capacity alone.

Finally, the Ministry of Energy is working with Ontario Power Generation (OPG) and a number of ministries, including Northern Development and Mines, Natural Resources, Economic Development and Trade, and Municipal Affairs and Housing, to assess the impact of closures on the workers and their communities. The government is asking OPG to engage its trade unions in discussions designed to minimize the impact of plant closures on employees.

A cost-benefit analysis released in April uncovered massive health and environmental costs from coal-fired generation. The study found emissions from all coal-fired stations were responsible for up to 668 premature deaths, 928 hospital admissions and 1,100 emergency room visits in Ontario per year. It also found that with an annual cost of $4.4 billion, coal-fired generation is significantly more expensive than other sources of electricity (ELW May 2-9).

Ontario's five coal-fired plants are the province's largest industrial source of greenhouse gas emissions and one of the largest emitters of smog-causing pollutants. In 2003, these facilities together emitted 37,000 tonnes of oxides of nitrogen (NOX) and 154,000 tonnes of sulfur dioxide (SO2). Their emissions of these compounds accounted for 14% of all NOX releases and 28% of all SO2 releases in Ontario. Also in 2003, total emissions of mercury from coal plants was 495 kg, or 20% of all mercury produced in Ontario.

Combined-cycle gas-fired plants emit no SO2 or mercury, and their NOX and particulate emissions are about 80 to 90% lower than those from existing coal-fired plants. Moreover, carbon dioxide emissions from combined-cycle plants are about 60% lower than those from coal-fired facilities.

Ontario's plan to close its coal plants is the largest single step being undertaken to help Canada meet its Kyoto targets. The closure of Ontario's coal-fired generating stations is expected to provide up to half of the province's greenhouse-gas-reduction contributions under the Kyoto Protocol.

More information is available on the Ministry of Energy Web site, www.energy.gov.on.ca.

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