Transformational Infrastructure: by Hon. Sergio Marchi |
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| Since their election and flowing from their ambitious election platform, the Federal Liberal government has laid out a number of broad public policy goals that align with electricity sector priorities
-- investing in green infrastructure, commitment to renewables and clean technology, and addressing climate change. Additionally, the Government of Canada has promised a significant robust investment in the renewal of the country's infrastructure, beginning with Budget 2016, and has set a number of priorities to govern decisions about allocating that investment. One of those priorities was long term, transformational projects. The Canadian Electricity Association (CEA) believes there are strong public policy drivers to make electricity infrastructure eligible for government investment. The benefits are consistent with priorities identified by the government, beginning in the election campaign through to the present. In fact, the Liberal Party said as much in responding to a CEA federal election questionnaire that was forwarded to all political parties. Currently, CEA is looking to partner with the federal government to develop an integrated proposal that explores how best to make targeted, longer term investments in electricity infrastructure. We would propose that it do so by focusing on significant "gaps" that currently persist in our governance structures. Let me explain. Identifying Gaps in the Current System The primary jurisdiction over electricity is provincial and most investment in electricity infrastructure is funded on a user-pay basis, passed on to ratepayers after approval by arm's-length provincial regulators. However, there is also a significant federal role in the sector. Be it through the 34 federal departments and agencies with policymaking responsibility and influence or through a historic, though time limited, engagement in accelerating the electricity system's transition to a low-carbon future. In the past, this division of roles has meant that provincial regulators have tended to focus on immediate costs and needs in order to keep rates to the consumer as low as possible, linking them closely to existing or immediately foreseeable requirements. In practice, the result has been a "ratepayer gap," essentially an overall reluctance by regulators to support experimental pilot projects, innovative technologies, renewable and/or green technologies and extension of service to areas without sufficient ratepayer critical mass such as Northern Canada. Yet, these are all legitimate and significant public issues. Moreover, government agendas are promoting these very aspirations. We should not allow investment and R&D into transformational projects in the production, transmission and distribution of electricity to fall between the cracks. So, how do we bridge the gap between government ambitions and regulatory decisions? And who should do it? |
On the critical, over arching issues facing the country, federal/provincial collaboration and cooperation must prevail. The new federal government has laid out a set of high ambitions
-- investing in green infrastructure, commitment to renewables and clean technology, and addressing climate change. It has also demonstrated its willingness to engage the provinces in addressing them. At the 2015 U.N. Conference on Climate Change (COP 21) and following the Paris Agreement, we have seen a concerted national effort to support further de-carbonization. This includes the electrification of transportation which contributes some 25 per cent of the carbon footprint, and greater resilience of critical infrastructure to severe weather impacts. Policy Development to Support Energy Transformation The public policy need and the political will being exhibited in Ottawa presents an opportunity for the federal government to use its spending power to join with provinces in funding (through tax dollars, not ratepayer charges) non-typical and transformative infrastructure projects to fill the gaps. There may also be a role for the private sector in addressing these challenges. In his Davos speech in January, Prime Minister Trudeau recognized the historic and economic role of electricity: "If we didn't build the public infrastructure in the early 20th century to support mass electrification, only the wealthy would have had heat and running water. And with that, the creation of the middle class -- the base of resilient economies -- would never have happened" - Prime Minister Trudeau, Davos / World Economic Forum, January 20, 2016 CEA agrees with the Prime Minister's take of history of how our forefathers built for the future. The Conference Board estimates that we will need to invest some $350B over 20 years to renew Canada's aging electricity systems. Canada is far from alone in confronting this challenge, the US, Europe, and Asia face the very same pressures. In tackling this obligation, we must embrace innovation as an enabling force that will facilitate our success in securing a reliable and sustainable source of power for Canadians well into the future. We must envision transformational projects and technologies that could be deployed at scale. We must look for new ways to bridge long-standing gaps. In other words, infrastructure investment with a different mindset, new partnership, and a spirit of national enterprise. We encourage the Prime Minister and other Canadian leaders to recognize, and act on, this historic nation building opportunity. To build a green future for generations to come. |
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N.Ed. Technology professionals interested in furthering their understanding of the impact of policy decisions on Canada's electricity grid may wish to look at some of the programming |
that was offered at the 2016 IEEE Electrical Power and Energy Conference (EPEC 2016), held October 12-14 in Ottawa. One of the 18 mini-symposia was on the topic of Government Initiatives, Policies and Smart Grids. Also, please stay tuned to the web site for EPEC 2017 for details as they become available. For an overview of current issues in Smart/Smarter Grid -- more recently referred to as the Integrated Power System -- we recommend a browse through our coverage in Issues 72 and 73 of the IEEE Canadian Review. |
1 Comment – Reviewed by Editorial Team, IEEE Canadian Review
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Normand Mousseau – 4 years ago – edited
It is difficult, almost impossible, to underestimate the role of electricity in the transition to a low carbon economy. As we move away from hydrocarbons for heating and transportation, the most likely alternative will be electricity. Not uniquely, of course — passive heating and energy efficiency should be preferred whenever possible – but dominantly. In fact low-carbon future scenarios include, without exception, much greater electricity use and fuel efficiency. There are many reason why electricity is at the heart of low carbon transitions.
Electricity from renewable sources is becoming more and more competitive with respect to alternatives. The most recent tender from Hydro-Québec, for example, was as low as 6.4 ¢/kWh, and prices are still falling. Electricity is also much more efficient than fuel for performing work; an electric car, for example, requires about four times less energy than a fuel-based one to move from point A to point B. Similarly, with heat pump, electricity can deliver two or three times more heat per watt than natural gas.
As Sergio Marchi rightly points out, the constitution attributes jurisdiction over energy to provinces which have, historically, perceived a need to ensure production inside their territory. This has led to a fragmented market with widely varying rates and energy sources as we move from province to province, preventing Canada as a whole from benefitting as much as it should from its renewable energy resources. This is even truer today as hydro dams scattered around the country constitute immense energy storage facilities that can be leveraged to increase significantly the part of intermittent renewable energies on the network. With a strong East-West national grid, it would be easier than in almost any other countries to reach a target of 90 or even 100 % renewable electricity over the next 20 years. Yet, this transformation is unlikely to occur without a national leadership that breaks the traditional provincial-centric position about electricity generation and demonstrates the advantage of thinking more globally in this sector, as it done by other national or transnational groups around the world.
Innovation, as underlined in the editorial above, is crucial, but, more important, are political will, vision and leadership. The absence of deep electricity integration between provinces is not caused by technical constraints but simply because nobody managed to drive the concept through. This is why it is essential for the Federal level to fully play its role in supporting an increase in interprovincial electricity trade and promoting low-carbon emission energy production.
This would go a long way in the development of a rich low-carbon economy for Canada in addition to foster the investments in innovation discussed by Sergio Marchi.
Catherine Potvin, FRSC, Canada Research Chair on Climate Change Mitigation and Tropical Forests and Professor of Biology at Mc Gill University
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Normand Mousseau, Professor of Physics and University Research Chair in Complex Materials, Energy and Natural Resources at Université de Montréal
Catherine Potvin is the founder and leader of Sustainable Canada Dialogue, a group of 60 scholars from across Canada, of which Normand Mousseau is part, that has offered a national action plan on climate change ( http://www.sustainablecanadadialogues.ca/en/ ).