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Ontario eyes hydroelectric projects as demand for power rises

The hydroelectric industry’s image has been tarnished by large projects, including the 1,100 MW Site C project on the Peace River in British Columbia, which suffered serious cost overruns.Courtesy of Site C Clean Energy Project

Anticipating surging demand for electricity, the Ford government has asked Ontario Power Generation to investigate the potential for building new hydroelectric dams in Northern Ontario.

On Thursday, the Ministry of Energy gave OPG the task of working with the Ontario Waterpower Association, an industry lobby group. Together, they’ll update previous evaluations of hydroelectric potential in the north, including life-cycle cost of building new stations as well as water availability.

Their report is to be delivered to the ministry and the province’s Independent Electricity System Operator (IESO) by April. The IESO, in turn, is to report back to the government by November.

“To power the Ontario of the future, we must explore new sources of hydroelectric power,” Greg Rickford, Ontario’s Minister of Mines, Northern Development, Natural Resources and Forestry, said in a statement.

“Further hydro development could spur job creation in Indigenous and remote communities, power industries and communities, and will ensure a cleaner future for our province.”

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Ontario has among the most diversified electricity generation mix of any province, with nuclear, natural-gas and hydroelectric fleets each accounting for around a quarter of the province’s generation capacity. (The remaining quarter comes largely from wind and solar.) Ontario has 9.3 gigawatts of capacity in existing dams, dominated by OPG’s 66 hydroelectric stations.

Harkening to the pre-1950s era when hydro provided substantially all of their electricity, Ontarians generally still refer to electricity as “hydro.” The province’s golden age of hydro development, though, is a distant memory. In 2015, OPG completed the six-unit, 438-megawatt Lower Mattagami River Project in partnership with the Moose Cree First Nation, which owns a quarter of the $2.6-billion project.

Projects of that size, however, have been rare since the 1970s; for years, OPG has largely focused on refurbishing or updating old hydro facilities, often resulting in significant efficiency gains.

In its latest annual planning outlook, the IESO anticipated that electricity demand will grow “at rates not seen in many years.” OPG’s Pickering Nuclear Generating Station is to be retired within a few years, while other nuclear units will experience lengthy outages as they are refurbished. In November, the provincial government asked the IESO to consider a moratorium on procuring new natural gas-fired stations.

“If the province is going to electrify – and many people believe that it will – then we’re going to need a lot more clean, emission-free electricity,” OPG spokesperson Neal Kelly said. “And hydroelectric, that is going to be one part of that equation.”

Dams feature several compelling characteristics: They provide low-cost power while emitting few greenhouse gases. (Provinces with the most abundant hydroelectricity enjoy grids with the lowest greenhouse-gas intensities, according to the Pembina Institute.)

Properly maintained, dams can last many decades, even centuries. They’re flexible: Dams with reservoirs can effectively store energy for when it’s needed, in contrast with other renewable generation methods such as wind and solar, which typically lack storage.

OPG and OWA seem likely to confirm the conclusions of their previous studies, which found abundant opportunities in Northern Ontario.

“As the demand for electricity increases, many waterpower sites that were previously deemed practical or uneconomic will become more feasible,” a 2005 OWA study concluded. “As well, developments that were previously proposed but not pursued may also become of interest.”

But Jack Gibbons, chair of the Ontario Clean Air Alliance, said he wasn’t aware of any credible studies demonstrating significant new hydro-power opportunities.

“Ontario Hydro’s last major water power project was the Saunders Station on the St. Lawrence River in the 1950s,” he said in an e-mail. “After that, Ontario Hydro started investing in coal and nuclear because it had tapped out all of its low-cost water power opportunities.”

Waterpower Canada, a national industry lobby group, said Ontario could add between 7,000 and 9,000 MWs of new hydroelectric capacity, roughly double current levels.

“It’s a common misconception that hydro power is tapped out,” said Anne-Raphaëlle Audouin, the organization’s president. “I think it stems from the fact that it’s 60 per cent of overall electricity generation in Canada, so people assume that surely, we developed all the hydro power there is in Canada. But in fact, it couldn’t be further from the truth.”

Even if opportunities exist, doubts remain about whether they can be exploited economically. The hydroelectric industry’s image has been tarnished by large projects including the 1,100 MW Site C project on the Peace River in B.C. and the Muskrat Falls station on the Churchill River in Labrador, both of which suffered serious cost overruns. (Less commented on is Hydro-Québec’s Romaine Complex, which has not attracted such controversy.)

Site C dam delayed, costs jump to $16-billion

The unnecessary Site C dam is shaping up as B.C.’s Muskrat Falls

“It makes sense to investigate opportunities for additional hydroelectric expansion in Northern Ontario,” said Nicholas Rivers, a professor at the University of Ottawa’s Institute of the Environment. But pointing to Site C and Muskrat Falls, he added: “Optimism should be tempered based on recent experience in other jurisdictions.”

Paul Norris, the OWA’s president, said hydro projects have difficulty competing with other generation methods when procurement horizons are short. “You’re talking six, seven years in advance preplanning, predevelopment and construction,” he said.

“That’s different than some of the other technologies we’ve seen added to the grid, which might have a two- or three-year timeline … and that’s why I welcome the ministry really looking at the long term.”

Last summer, the International Energy Agency produced its first report dedicated to hydro power. It concluded that considerable untapped capacity exists, particularly in developing countries, and that much of it is economically viable. However, it predicted that hydro power’s growth would slow, while noting that hydro power plants in advanced countries are aging and their share of generation capacity has been falling.

“This is something the world can ill afford,” the IEA warned. “Hydro power is the forgotten giant of low-carbon electricity; it produces more of it than any other source worldwide.”

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Read More: Ontario eyes hydroelectric projects as demand for power rises

2022-01-23 18:54:35

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