Friday, July 22, 2011

CBC's Energy Game

I stumbled across this "game" on the CBC website recently. It's an interactive page that let's you "balance Canada's energy budget".

Usually, real budgets involve tradeoffs of some kind, like financial constraints or policy limitations. This is why they are difficult to balance. This website, in contrast, is mostly free of any constraints, except for the rather weak "Kyoto" limit - just slide those "renewables" over to 100% and "balance the energy budget"! Bingo!

What's missing here? How about at least some indication of:

1. the relationship between limits on CO2 emissions - beyond Kyoto - and the global temperature increase
2. the limits on how fast new infrastructure can come online
3.the economic impacts of increased energy costs.

Of course, any discussion about CO2 emissions is a dead duck, federally. Canada's not supporting anything past the Kyoto agreement (which ends in 2012). Our federal government's official position appears to be  wedded to becoming an "energy superpower" by mining / drilling as much as possible and shipping it all to China, greenhouse gases be damned. We're gonna be rich! Rich!! And given the political climate, we're likely wedded to this position for the 2 election cycles (about 10 years). Meanwhile, our emissions are skyrocketing, even the global recession hasn't made a dent. Fatih Birol, chairman of the Internation Energy Agency (normally an organization quite bullish on oil) is on record as saying we are likely not going to keep our planet from heating less than the 2C required to avoid major climate change. Kyoto isn't even enough to keep it to this level - we need 50-80% reductions in the amount of CO2 we release, so this actually means shutting down some of the fossil-fuel-based power generation. But these types of considerations aren't mentioned in the CBC game.

Then there's the limit on how much we can actually build. Last I checked, it takes years for new infrastructure to be built. A new hydro dam takes a decade, as does a nuclear plant. At least. Windmills can be slapped up faster if the transmission infrastructure is in place and if it makes economic sense - which, so far, isn't the case in most provinces.  Only new infrastructure that's already in the planning pipeline should really be included in this game. From a BC perspective, BCHydro is supposed (by legislation) to generate enough electricity to make BC self-sufficient by 2016, but at the current pace of new resource development, they'll be hard-pressed to do this. There is no way that we're going to have site C up and running in this timeframe, or that any appreciable windfarm is going to come online. Instead, BC will continue to rely on dirty power from AB and the US.

Then, there's the energy costs on the sliders. There's only 2% inflation built in to the costs, which for oil and diesel I think is highly optimistic, given the market gyrations we've been seeing in the last few years.
For the renewables, it looks like the CBC has just put in an average cost of $0.22/kWh (and not even a 2% inflation increase). Now, for wind and solar power in particular, I fear this really underestimates the total cost of electricity:
- windmills reqiure a lot of transmission lines (one to each windmill) - and eventually substations, if you build enough of them - likely not included in the price. Especially since a lot of the windy places here in BC are really quite distant from any existing transmission lines.
- above about 20%, the more you rely on wind power, the more you need to overbuild. This is because the wind may not always be blowing when you need power - so you need to build extra windmills in other locations to catch wind there. This price is clearly not included, and the costs actually increase as you start to rely more and more on wind power (or any other intermittent source). To see why,  if you have only 20% of your power from wind, you can back up with other power sources (hydro, gas) during quiet periods and you don't need other windmills. But, if you rely 100% on wind, your only backup is going to be other windmills from some other location, that had better be there just in case.
- if you don't overbuild, then you need energy storage so that you can save energy when the wind is blowing hard. The more you rely on intermittent sources, the more storage you need and the higher the price of your electricity. The simplest and cheapest form of storage is pumped hydro, but this isn't always an option (ex. Saskatchewan), and you're looking at much more expensive forms. Again, this price is clearly not included.
- if you don't overbuild and have no storage, you'd better be able to trade electricity with other jurisdictions that have extra capacity. I'm pretty sure that current grid intertie connections between the various provinces and the US are not up to handling the increased flows of electricity that would be required for this volume of trading. Upgrade costs to the system are likely not included in the model's prices.

So in the end, I think a more realistic picture of the energy budget game would allow only 20% of the total new energy to come from renewables (ie. 20% of the 150,000 MW required = 30,000 MW). If we want to stop frying our planet, we have to shut down all the coal and get off of oil. We'll need the gas-fired turbines still - realistically, it'll be impossible to run the system without them as they are required to take up the slack when the renewables aren't available. It's pretty plain that then the only other players left standing are nuclear and hydro - we need more of both. If you want to do it all with hydro, you'd need about 20% more hydro capacity - this is going to be tough to come by. For reference, site C represents about 10% of BC's total capacity. So just in BC alone, we need 2 site C's to get to 20%. Like it or not, if you want to reduce greenhouse gas emissions, nuclear power must be part of the mix for the foreseeable future. Although I suppose you can go the route of Germany, and shut down your existing nuclear order to replace them with....coal! Geez, great idea!

According to the game, then, with this balance, our 2020 price of electricity will be $0.14 / kWh. That's a 20% increase over what we currently pay (on average, in Canada). That's 20% over 8 years, or an annual inflation rate of some 2.5%. Doesn't seem too bad to me...

So, CBC, how about some actual discussion of the issues raised by this "game" of yours?

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