The Grid 2022: The Accelerated Issue

Letter From the Editor

Daniella Bidin

Communications Advisor, Electricity Canada

If there’s one thing that best describes the mood in the electricity sec tor right now, it’s “urgency”. There are huge climate goals for Canada in the years ahead, looming closer and closer; a Net Zero electricity grid by 2035 and a Net Zero economy by 2050.

Accelerate – our 2022 theme – was inspired by that sense of urgency. But that begs the question: what can we do, as an industry, to meet these challenges?

The answer is simple. Everything.

We need to create the technology of tomorrow to decarbonize our planet.

We need to hire the diverse and inclusive workforce to gain better perspectives to drive our industry forward.

We need to rethink our current regulatory regimes so that we build for the future we want instead of the future we have.

We need to collaborate.

To bring about all this, our venerable association in its 131st year, has shed its old skin and rebranded as Electricity Canada. The new brand signals that we want to be leaders, bringing about – as our new tagline says – Our Energy Future . Witnessing this brand come to life over the past couple of months has reaffirmed how essential it is to raise the voices of our members and their customers to create a more sustainable future.

This edition of The Grid magazine emphasizes the goals, successes, and challenges of acceleration in the electricity industry. I hope you find these stories compelling as we move towards a better future.

Decarbonizing the economy

Fast Forward Beyond Net Zero

Francis Bradley

President and CEO, Electricity Canada

Everyone is talking about the aspiration for Canada to achieve Net Zero greenhouse gases economy-wide by 2050 and recently, a Net Zero electricity grid by 2035. But what comes next? What lessons can we draw from the past and project into the future? What could the Canadian electricity picture look like beyond 2050, out to 2075?

History is rife with examples of social change and technology adoption that initially seemed far off but reached a tipping point more quickly than anticipated. Before more modern methods of transportation, the greatest environmental problem facing the city of New York at the turn of the last century was horse manure. At the time, given the continued growth of the city and population, experts were predicting that New York would be buried 30 stories deep in manure as a direct outcome of the millions of horsecar trips taken through the city each year. And yet, this didn’t come to pass. The rapid adoption of the automobile more than a century ago turned this conventional wisdom on its head.

Today, in the electricity sector, we have seen the cost of intermittent renewable electricity sources drop dramatically. What started out as the most expen sive option has now become, in many cases, the least expensive incremental source of electricity generation.

What these two examples have in common is Wright’s Law, which postulates that the cost of a unit decreases as a function of cumu lative production. In other words, as the production of cars (or wind turbines) increases, the cost per unit decreases.

If we apply Wright’s Law to the emerging or even existing but expensive technologies that may transform the future of energy, like small modular reactors, direct air capture or hydrogen electrol ysers, what could happen to electricity beyond 2050 could be revolutionary.

Picture a world in 2075 where international cooperation on climate change has continued to build, to a point where there are bind ing agreements for greenhouse gas emissions. There are also agreements where Net Zero ambitions have been met, and are now replaced by net-negative commitments. These targets seek to reduce carbon concentrations in the atmosphere to begin to reverse the impacts of historical GHG emissions from a centu ry-and-a-half of industrialization. There is a functioning global emis sions trading system in place, to address both atmospheric carbon reduction targets and continued emissions in “hard-to-abate” sectors, like air transportation and agriculture.

The global energy picture in 2075 might include the emergence of new global energy superpowers, thanks to the continued decrease in costs for solar and wind, both onshore and off. Canada, Austra lia, Russia, the U.S., India, as well as Saharan and African countries, have become not only dominant players in wind and solar, but also in the production of green hydrogen.

Due to our geography, Canada would now be a leader in the generation of emissions-free electricity, the production of green hydrogen, blue hydrogen with carbon capture, and a major direct air capture hub. The grids would have evolved so that the large central (fossil fuel-free or carbon-captured) generation plants are complemented by community-level resources as well as distrib uted resources at the customer level. The natural gas distribution network would have been transformed by 2075 as a distribution system for hydrogen, which would now support a variety of tech nologies, including fuel-cell transportation and critical emergency power back-up, supplanting the need for storage in many applica tions. Indeed, for some applications, hydrogen would become the long-duration storage solution.

The major clean energy companies in 2022 would continue to expand their hydro and nuclear generation over five decades, and would now be joined by major players on both coasts, and in the prairies, due to very favourable solar and wind regimes. Domestic, continental, and global markets for both hydrogen production and for direct air capture contracts will have created new opportunities. Nimble and flexible players- those able to toggle between electric ity production, hydrogen production, or direct air capture, are able to maximize opportunities depending on market conditions, and new energy hubs emerge. The centre of gravity for energy shifts to these new hubs, that become more geographically diverse such as in Vancouver, Saskatoon and St. John’s. Energy pricing is no longer expressed as Brent or the WTI, but what the price may be on the

Tsawwassen Index, the Moose Jaw Market or the Heart’s Delight Exchange.

The customer’s world in 2075 would have changed as well. The era of the prosumer would now be evolved to the full automation of customer decisions about energy. Thanks to the speed of quan tum computing and complexity of evolved Artificial Intelligence, customer energy systems would know customer preferences, and algorithms are able to make energy decisions for customers, based upon their preferences as well as market conditions. Energy utilization will have changed thanks to the emergence of new tech nologies, such as advanced hydrogen fuel cell combined heat and power, and the emergence of new transportation options. By 2075, a “hybrid vehicle” would be a vehicle which has both battery and hydrogen fuel cell technology.

For customers with significant distributed energy opportunities, energy use would dynamically adapt to changing market oppor tunities. The connected customer can draw electricity from the electricity grid if the price is right, or from a community micro-grid. If weather conditions are favourable, self-generation may meet the customer’s needs. And in the case of surplus self-generated electricity, the customer energy system will seek to maximize value by selling back to the grid, the community, to direct air capture aggregators, or perhaps to a community hydrogen producer.

This is neither far-fetched nor science fiction. These are all tech nologies that exist today but are currently not economic, or not to scale. However, Wright’s Law will bring these solutions into our future. All that is missing is political will, international cooperation, and the policies and frameworks to move us to Net Zero… and beyond.

Electricity Canada is Ready for Our Energy Future

Julia Muggeridge

Vice President, Communications and Marketing, Electricity Canada

Most people experience rebranding as a “What the…!?” situation. It’s that moment when you find yourself saying, “Why does my dishwashing pow der have a new logo!?” or “Is this really my CIBC branch!?” It’s a moment of surprise and puzzlement.

On March 1st, 2022, the Canadian Electricity Asso ciation became Electricity Canada. There is a new name, a new logo, new colours, and a new tagline.

So why the change?

In early 2021, we interviewed a number of members of our Board of Directors, our Public Advisory Panel, internal staff members and executives in the energy sector and asked them about our brand. We weren’t concerned about the colours or the logo. We wanted to know if “Canadian Electricity Association (CEA)” was effectively demonstrating our leadership in the energy sector. We asked if "CEA" in its current form communicates our role in the climate change conversation.

What we found from those stakeholder conversa tions was that the existing CEA brand was quiet and safe.

We needed a brand that was bolder and more aligned with our leadership role in the Net Zero conversation.

What we heard was that we need to be doing every thing, exploring every innovation to achieve Cana da’s Net Zero targets. To do that we can’t be safe. We can’t blend in. We have a “loud and proud” message about electricity to tell government, stakeholders, the media and our customers. This new brand will help us deliver and broaden this message.

Becoming Electricity Canada allows us to attract a more diverse audience. Removing the word "asso ciation" allows us to strengthen our activities which in addition to lobbying, include education and other services. We believe a more vital name will show the breadth of what we do.

Then there’s the look and feel of the brand. We looked at the various national organizations clus tered in downtown Ottawa and, within that bubble, it was a sea of greens, blues, reds and yellows. We needed to stand out. (Moreover, electricity doesn’t actually have a colour so we can choose what colour we like!) That’s why our new icon is pink—it stands out, and says we aren’t here to do business as usual.

But the biggest and most important change – the one that signals why this rebrand is so important –is our tagline, “Our Energy Future”. Because it’s the truth. Electricity will be our energy future, especially as we decarbonize our economy in the coming decades. It’s a tagline that’s honest, truthful, inspira tional and positive, which is something we all need right now. It’s something we can all stand behind.

Rebranding is often surprising. But for us, this rebrand came at the perfect time. We need to tell Canadians that electricity and climate change are connected, and electricity is part of the solution. We need to do this boldly and courageously.

We are Electricity Canada, and we represent Our Energy Future!

Elexicon Energy Builds Canada’s First Preplanned Nested Microgrid Community

Edyta McKay Manager, Public Affairs and Communications, Elexicon Energy

A few years ago, the Greater Toronto Area and Durham-based utility, Elexicon Energy, unveiled its plan for a fully functioning preplanned microgrid community of the future. The idea was to test, develop and launch the next generation of technologies that could turn electricity distribution systems into modern, digitally-enabled grids. These modern, smart microgrid communities could provide residents, and critical service providers, with backup power when the grid fails, as well as support rooftop solar, battery storage and electric vehicles.

With support from Ontario’s Independent Electricity System Operator (IESO) and the provincial government, and in partnership with Opus One and developer Marshall Homes, Elexicon created Altona Towns in the City of Pickering, just east of Canada’s largest city. With about 45 thousand new residential homes built in Ontario each year, the project went live this past summer.

As the first project of its kind in Canada, the community includes a rooftop solar, lithium-ion battery energy storage, electric vehicle charging stations, innovative smart metering system for commu nity use, and an integrated distribution energy service platform to control and coordinate the components of the microgrid.

The project is the culmination of four years of planning, implemen tation, and technology and equipment installation and will demon strate how microgrids can benefit homeowners while reducing the amount of electricity needed from the grid, helping make the pro vincial electricity system more affordable. It will also provide home owners with increased energy resiliency and reliability, especially during power outages, while also offering an exciting alternative to conventional sources for power that are cleaner, economical, and adaptable to future climate change impacts.

Elexicon Energy will gather data from the transmission station down to the local community, using Opus One’s distributed energy management software platform, GridOS. These learnings will help us understand how and when electricity is used, and how willing homeowners are to shift their energy consumption habits.

The software has been integrated into Elexicon Energy’s electricity distribution operations, incorporating microgrid-assisted feeder automation capabilities to enable automated control features such as peak shaving, load shifting, backup power, demand response, voltage control and renewable power integration.

With decarbonization and digitization as key goals for local dis tribution companies, Elexicon Energy is hoping this project could serve as a model for utilities and communities across the country.

The vision is to get a better handle on how practically and tangi bly distributed energy resources can keep the lights on during an emergency, increase the grid’s capacity for solar, batteries and EV chargers while keeping power bills low for homeowners, and at the same time giving them more choice on power generation and control on consumption.

Canad a’s New Regulatory Paradigm –Least C ost of Net Zero

Alex Kent

Manager, Regulatory Affairs & Grid Infrastructure, Electricity Canada

Canada’s regulatory construct for electricity, the so called “least cost of service”, has reached the end of its useful life. This doesn’t mean that least cost of service wasn’t good, or that some value cannot be saved, but it is time to consider what comes next. Electricity Canada believes that “least cost of Net Zero” is the answer. Least cost of Net Zero is a new construct that says it is the responsibility of provincial and territorial energy regulators to make decisions based on Canada’s Net Zero targets.

Least cost of service rules exist because, as regulated monopolies, utilities have a duty to serve those in their service area and they are restricted to charge those customers a determined amount. In turn, utilities have a guaranteed rate of return based on the assets they own and operate (i.e., the rate base). Utilities must prove to their regulator that they are meeting an investment requirement with the lowest cost option or "least cost of service." These rules ensure that utilities don’t abuse their monopoly nature and overcharge for their services, or recklessly build and demand compensation for overly expensive work.

In principle, least cost of service ensures customers receive electricity at a reasonable cost and that utilities are fairly rewarded. However, this regulatory construct is not up to the challenge before it, namely that Canada, and much of the world, have pledged to reach Net Zero by 2050. Canada will only achieve its goal of Net Zero carbon emissions by 2050 if we meet our energy needs without adding carbon to the atmosphere. As we currently add over 730,000,000 tonnes of CO2 to the atmosphere every year, this is an Everest of a goal.

Zero-net-carbon electricity is the energy source that is going to allow us to scale the Net Zero mountain, but we are going to need a great deal more of it than we have today, and that is the crux of the

challenge before Canada. The Government of Canada reported in “A Healthy Environment and a Healthy Economy 1” that our national electrical supply will need to double or even triple for us to reach our Net Zero goal. This estimate was further confirmed by the International Energy Association (IEA) in their 2022 report on Canadian energy policy 2. While a requirement to at least double Canada’s electricity supply is daunting, it is a reasonable estimate. To illustrate why, in 2018 Canada’s transport sector consumed 2,844.2 petajoules of petroleum based energy 3 which is equivalent to 790.06 terawatt hours of electricity which is 123% of the energy generated in 2018 by the entirety of Canada’s electricity system 4 Because electric vehicles are 2-4 5 times more energy efficient than their internal combustion counterparts, the fully electrified trans port sector may only require one quarter as much energy to operate. However, even one quarter of 123% is still a 31% needed increase over the amount of electricity that Canadians generate today.

Other areas that will also need significant new electricity supply are building heating (which can benefit from energy efficiency retrofits) and industrial processes (which can benefit from green hydrogen). When electrification in all these sectors are considered, a doubling of electricity supply is a large and reasonable estimate, but it is achievable, just not under least cost of service model for four fundamental reasons.

First, to double Canada’s electricity supply over 28 years requires 2.5% compounding growth per year. When you factor in Canada’s estimated population growth 6 between now and 2050, the needed electricity supply growth becomes approximately 3.1% per year 7 Some regions may need more electricity supply, and others less. But, regardless, electricity companies will struggle to supply Canada with the needed zero-net-carbon electricity to make this average 3.1% growth because they are held to least cost of service rules that require them to base their growth on historical norms. Norms that are no longer relevant because Net Zero demands that electricity must grow to replace other energy sources, instead of merely increasing in proportion to Canada’s population.

Second, there is no justification to increase investment in electricity today as there is enough electricity and electricity infrastructure to meet Canada’s current needs. However, we will soon be presented with increases in electrical demand and if we don’t start building today, meeting this demand will be too great a challenge.

Third, regulators are concerned with costs when assessing a utility's rate base investment proposal. The regulator may be bound to make decisions that do not align with Net Zero goals as it is not their role to consider environmental impacts, including carbon emissions. If a regulator is presented with two options, a more expensive zero-carbon option, and a cheaper carbon emitting option, the regulator will accept the latter.

Finally, regulators do not usually allow utilities to be compensated for investments made outside of the traditional definition of utility rate base. A utility can only be compensated for infrastructure and assets it owns and operates, not the work it does to meet the needs of its customers. Some critical solutions that fall outside of that framework include energy efficiency retrofits, behind-the-meter energy storage, solar panel maintenance, trading emissions credits between provinces, or anything else utilities could do to reduce electrical demand and/or increase electrical supply in a Net Zero carbon way. These outside rate-base solutions, if they are at a rea sonable cost to the customer, should be allowed and utilities should be compensated for them in rate-base.

It is because of these reasons that Electricity Canada proposes that we move from least cost of service to “least cost of Net Zero”. Under a least cost of Net Zero regulatory construct, each utility would be tasked with finding least cost solutions to grow the elec trical supply at a manageable but consistent pace (approximately 3.1% per year) needed to make it to Net Zero by 2050. Provincial/ territorial regulators would also have clear guidance on whether new projects meet the provincial/territorial Net Zero targets. With least cost of Net Zero, regulators would be allowed to consider long-term energy needs, as well as environmental impacts, and utilities could be creative in how they meet those long-term energy needs.

The risk imposed by least cost of Net Zero to the consumer is low. This is because the cost of growing the electricity system would be primarily paid by other groups electrifying their energy consump tion. Money that would have gone toward gasoline and other emit ting energy would instead flow to electrical companies because they are supplying the energy.

Least cost of Net Zero would also be a flexible system whereby each provincial/territorial regulator will set their own targets and consider solutions as they are brought forward. There is no pre scriptive action that each province should take; the Net Zero path for Alberta will be different from Nova Scotia’s. The federal govern ment would also play an important role by assisting the provinces and territories.

Canada:

This proposed change in the regulatory construct is not intended to upend how the Canadian electricity market works, rather it is intended to allow both electricity companies and regulators to rec ognize that new goals and tools are necessary to reach Net Zero by 2050. If Canada expects to meet its climate ambitions, then our governments, and our energy regulators, have to say a respectful goodbye to the least cost of service construct and welcome least cost of Net Zero.

1 Page 20 of the report reads “In order to accelerate the electrification of its economy, Canada will need to generate even more affordable, clean energy than it does today. By 2050, Canada will need to produce up to two to three times as much clean power as it does right now.” That statement is derived from a 2016 analysis done by the Trottier Energy Future Project “Challenges and Opportunities for Canada: Transformations for Major Reduction of GHG Emissions” https://iet.polymtl.ca/wp-content/uploads/delightful-downloads/TEFP_FinalReport_20160425.pdf

2 Source: International Energy Association (IEA), https://iea.blob.core.windows.net/assets/7ec2467c78b4-4c0c-a966-a42b8861ec5a/Canada2022.pdf, retrieved on Jan 25, 2022.

3 Source: Natural Resources Canada https://oee.nrcan.gc.ca/corporate/statistics/neud/dpa/ showTable.cfm?type=CP&sector=tran&juris=ca&rn=7&page=0 , retrieved on August 17th 2021.

4 The electrical sector generated of the 641.1 terawatt hours in 2018. Source: Natural Resources Canada https://www.cigre.org/userfiles/files/Community/National%20Power%20 System/2020_National_Power_System_CANADA.pdf, retrieved on August 17th 2021.

5 Source: US Dept. of Energy https://www.fueleconomy.gov/feg/atv-ev.shtml retrieved on August 17th 2021.

6 Canada’s population today is 38 million, Source: Statistics Canada https://www150.statcan. gc.ca/t1/tbl1/en/tv.action?pid=1710000901 retrieved on August 17, 2021.

Canada’ population which finds a total population of approximately 45 million in 2050. Source Statistics Canada: https://www150.statcan.gc.ca/n1/pub/91-520-x/2019001/sect02-eng.htm, retrieved on August 17, 2021.

7 The full calculation to find the yearly growth rate is ((45,000,000/38,000,000)*2)^(1/28) = 1.031. The system must grow at 3% per iteration to achieve a total 2.37 size increase over 29 compounding iterations. Here those iterations are years and 29 years is selected as it is 29 years till 2050.

Exploring Dynamic Line Ratings: Increasing the Capacity of the Grid

Richard Boulton

Director of Engineering and Technology, AltaLink

With Canada’s target to achieve Net Zero emissions by 2050, there is a push to incorporate more renewables onto the grid. The elec trification of many of our current uses for fossil fuels, such as the switch to electric vehicles, will drive the need to move increasingly larger volumes of clean electricity through the grid. Many predict an increase in two to four times the amount of electricity used today.

As the Director of Engineering and Technology at AltaLink, I am working on preparing the grid for electrification and the integration of more renewables. One technology that we are currently explor ing is Dynamic Line Ratings to help optimize the grid.

Overhead transmission lines are designed to operate up to a maxi mum operating temperature. Heat is generated by line losses which increase as more current flows through the transmission line. As this heat energy dissipates to the surrounding air, the amount of current needed to reach the line’s design temperature varies with ambient conditions. The two factors that have the most impact on capacity are wind and ambient temperature.

Exceeding a line’s maximum operating temperature can have safety implications and can jeopardize reliability, which is why utilities have rated the capacity of their lines using conservative assumptions of ambient conditions, referred to as ‘Static Ratings’.

Dynamic Line Ratings vary based on real-time measurements or forecasts of a transmission line or ambient conditions. Weather conditions are highly variable, and the static ratings are based on conservative assumptions. Most of the time, a transmission line’s capacity far exceeds its static rating, and can be as high as about double the static rating at times.

AltaLink has tested various devices to measure real-time condi tions on our transmission lines to produce dynamic line ratings. Alberta’s harsh environment caused these devices to stop work ing, go out of calibration or even be blown off the line. In the last few years, we’ve focused on meteorological approaches which utilize much more reliable weather stations and weather forecasts.

What we’ve found is that Dynamic Line Ratings are particularly well suited for lines whose loading correlates with ambient conditions, such as lines that move energy from wind generation. On windier days, when the wind farm is creating more power, the transmission line can move a higher volume of energy because it is being cooled. Basically, more wind creates a cooler transmission line, resulting in more transmission capacity.

AltaLink has successfully applied this technique to a transmission line attached to a wind farm, and we have been exploring other opportunities to apply this exciting and powerful new technology.

As the demand for energy transformation, electrification, and renewables continues to increase in Canada, Dynamic Line Ratings can help Canadian utilities unlock the capacity that already exists and transform the grid for the better. I’m proud of the work that we have done so far in piloting this innovative technology!

Big Thinking for a Small Community: A Remote Battery Energy Storage Solution

Peter Brodsky

Public Affairs Manager, FortisAlberta

A traditional wires and poles distribution company may not be the first place you think of when you think about accelerating the future of the electricity grid, but at FortisAlberta, we invest talent and resources in solutions that not only meet our customers’ needs but reflect our focus on sustainable solutions.

Recently, FortisAlberta was faced with a new challenge. To improve the dependable delivery of power to a community located in a national park, surrounded by a treasured old growth forest, in a townsite of no more than 150 year-round residents, who host as many as 400,000 visitors each year in the summer months.

The solution was to energize our first battery energy storage sys tem to provide backup electricity in Waterton Lakes National Park, thereby improving the reliability of the local power supply, with minimal impact to the area’s sensitive environment.

Prior to this installation, a single 70-kilometre-long distribution line connected Waterton Lakes National Park to the grid. The Water ton townsite experiences more frequent and longer outages than many other locations in FortisAlberta’s service territory because the area is windy and heavily treed. Building a second distribution line to serve the community would have required the removal of mature trees, and disturbing sensitive wildlife habitat.

This energy storage project showcases the technical, economic, environmental, and social benefits of a battery energy storage system, solar photovoltaic renewable generation, and advanced

distribution control systems. It will maintain power during an outage while the distribution line is being repaired, providing a reliable alternative source of electrical power for the Waterton townsite and the Parks Canada compound.

“We’ve created a microgrid that will seamlessly transfer between grid and battery supply during most system disturbances so there is no service disruption to the Waterton townsite,” says Kevin Noble, Director of Engi neering at FortisAlberta. “Now that we have tested and proven the feasibility of this technology in Waterton, we are positioned to provide similar solutions to our customers in other remote communities,” adds Janine Sullivan, President and CEO of FortisAlberta.

The $5.1 million project was funded by Natural Resources Cana da’s Smart Grid Program, Alberta Innovates, Emissions Reduction Alberta, Opus One Solutions and FortisAlberta.

Located in the Parks Canada operations compound, the battery and control systems are owned and operated by FortisAlberta. Solar panels located in the same compound, that form part of the microgrid, are owned and operated by Parks Canada. The com bined installation will reduce greenhouse gas emissions by 25%.

Canada:

Beyond Climate Mitigation with NatureBased Solutions

Jay Wilson

Director of Generation and Stewardship, Electricity Canada

An interview with Bryan Gilvesy, CEO of ALUS

What comes to mind when you think of nature-based solutions? Do you think about natural spaces, like forested areas, streams, or grasslands? Do you picture somewhere in the distant wilderness of a coastal rainforest or tundra, or somewhere closer to home?

Despite hearing a lot of discussion of nature-based solutions in my work on climate mitigation and adaptation, I realized I didn’t know much about it.

Luckily, I found someone who does. Bryan Gilvesy is a farmer, a rancher, and the CEO of ALUS, a non-profit dedicated to helping farmers like him build and maintain nature-based solutions. Major corporations including several Electricity Canada members are already supporting ALUS’ innovative approach to naturalizing on-farm landscapes.

I wanted to know how Bryan started on this path, why farmers and ranchers are the key to preserving ecosystems, and how ALUS can help corporations deliver on their climate and biodiversity goals.

Jay Wilson: Bryan, it’s a pleasure to meet you! I’ve been looking forward to this conversation. Thanks for making the time. Where are you coming from today?

Bryan Gilvesy, CEO of ALUS: Thanks for setting this up, Jay. I am coming to you from 350 acres of farm and ranch land in Norfolk County just south of Tillsonburg, Ontario.

JW: Well let’s get into it! To start off, what are nature-based solutions?

BG: “Nature-based solutions” is a term that refers to what commu nities can do to meet challenges in ways that are inspired by the environment. What we do at ALUS is help farmers and ranchers use nature-based solutions to provide cleaner air, cleaner water, car bon sequestration, erosion control, flood and drought mitigation, and pollinator and wildlife habitat.

To do nature-based solutions well, you need three things: skills, energy, and land. Farmers have all three. They also understand the rhythms of nature on their land because they live and work there and can maintain them over time.

JW: Bryan, you’re a farmer and a rancher, how did you find out about nature-based solutions? Is this something you’ve always known about?

BG: It’s not, it’s something I had to learn about. That story really begins in 2005. I was managing my land and my cattle as best I could. I had a cold-water stream on my land, and I wanted to bring my cattle over to a remote pasture on the other side without damaging trout habitat. I went looking for programs to help me, but the only funding available was tied to remediation, meaning, I could get funding only if the stream was already damaged. Fortunately, I was introduced to a group of people who were focused on creat ing a solution that was proactive. They helped me build a stream crossing for my cattle as well as infrastructure to keep them on the highlands. That turned out to be the ALUS Pilot Program, and I was their third participant. I stayed involved as the program grew and I eventually became the CEO. Now we have over 1,100 farmers in 33 communities across Canada, and we’re growing quickly.

JW: I know some Electricity Canada members are already involved in various ways with ALUS. You also have a program geared towards the corporate sector, the New Acre Project. Can you tell me about that?

BG: Absolutely. ALUS is focused on helping farmers develop nature-based solutions with their knowledge and resources. But corporations are also catching on to the benefits of nature-based solutions. That’s why ALUS created the New Acre Project, an initiative to help corporate sponsors fund nature-based projects by the acre. The “New Acre” concept means the investment is creating new, tangible improvements in one of our communities.

We track dozens of metrics so that our sponsors know exactly what the impact of their involvement is. Corporations need to be able to measure and demonstrate the impact of their work, and our database measures, tracks and reports the ecosystem attributes that they sponsored.

JW: Corporations are under a lot of pressure to quantify their impacts – both positive and negative – and to be able to show that there is a net benefit to communities in which they operate and to the broader world. You mentioned your database. Do you do direct matchmaking of farmers and corporations? How do you manage that?

BG: We work with corporations to understand where they want to drive impact and match them with participating communities who implement the program. Projects are approved by a local Part nership Advisory Committee, mapped in the ALUS database, and assigned a unique code that will be applied to all of that funder’s acres. Then, we report back to the funder in aggregated form. We know down to the decimal point how many acres of wetland, or fish habitat or native grassland, and we can allocate those as units to corporations that want to support those specific kinds of projects.

JW: So, one of our biggest areas of focus is climate change, can you speak to how nature-based solutions can be marshalled to help with climate mitigation and adaptation?

BG: Yes, the kinds of solutions we implement help to absorb more carbon from the atmosphere. Whether that’s tree planting, wetland restoration, re-establishing native grasslands or even just mod ifying the way the farmer’s crops are managed, we are seeing a carbon benefit there. They also help mitigate the effects of floods and drought that come from extreme weather.

JW: Can you quantify those benefits as an offset? That’s a major priority in the electricity sector. Probably the most important word to us in “Net Zero emissions by 2050” is “Net”, because there are probably going to be some emissions that we just can’t eliminate. How does ALUS measure and account for those benefits?

BG: We support that approach, and we would say that our carbon reduction credits are better value than a traditional offset. For example, with a carbon offset from a methane capture site at a landfill, you get the avoided GHG emissions. But with a naturebased solution like New Acre’s, not only do you get the emissions benefit, but you also get biodiversity, water quality, flood resiliency, and so on.

Proper quantification is essential. We have a sophisticated system for New Acre’s work, and that system is constantly improving. We’re working on three priority areas for quantification: watershed mod elling, carbon sequestration, and biodiversity. We’ve created over 150 square kilometres of impact across the country and this is still growing. The key thing is to ensure that we are creating the highest quality nature-based solutions we can, and keep improving how we quantify those as we go.

JW: Before we wrap this up, could you suggest something to the person reading this to help them better understand naturebased solutions?

BG: Absolutely. I would recommend a report released by Nature United called Natural Climate Solutions. The report lays out how nature-based solutions on agricultural land can provide most of the climate benefits we’ll need to help get to Net Zero by 2050. These solutions really have so much to offer Canada. Most agri culture is in the southern part of the country where Canadians live, work and play, so more of us can see and experience it. With nature-based solutions, you’re doing good where more people can see it.

JW: Bryan, this has been great, thank you. Where can people find you?

BG: Thanks Jay. You can read more about ALUS at alus.ca and our corporate solution New Acre Project at newacre.org . And you can follow ALUS via LinkedIn and Twitter for the latest news.

Jay’s interview with Bryan was conducted via video call and has been edited for length and clarity.

Corporate Partner Program

Electricity Canada’s Corporate Partner Program connects companies that manufacture, consult or provide a service to all facets of the electricity industry with decision-makers of Electricity Canada members, from every province and territory in Canada. Corporate Partners may currently be established in the Canadian market or looking for a way to introduce their products or services from outside the country to Electricity Canada members.

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For more information, please contact: Faran Mirza, Manager, Corporate Partner Program and Sponsorships. mirza@electricity.ca

Electricity

ENMAX: Powering Alberta’s Lower Carbon Future

Chinta Puxley

Senior Advisor, External and Corporate Communications, ENMAX

ENMAX Corporation is accelerating into a low carbon future with a focus on solutions that will power a brighter tomorrow.

ENMAX Energy is the Alberta-based competitive generation and retail business of ENMAX Corporation and maintains a 1,512-mega watt generation portfolio made up of 86% natural gas and 14% wind. As part of its commitment to achieve Net Zero by 2050, ENMAX Energy is actively managing and reducing the carbon foot print of its natural gas-fueled generation fleet. This means making strategic investments to reduce the emissions intensity of ENMAX Energy’s fleet while ensuring reliable, efficient operations.

“As an essential electricity service provider, we recognize we are in a rapidly evolving energy landscape and that preparing for future customer and community needs involves enabling the electrifica tion of our society and a lower carbon future,” said Greg Conlin, Vice-President of Operations at ENMAX Energy. “Today, we hold

one of the most efficient generation portfolios in Alberta. Our natu ral gas-fueled power generation facilities have amongst the lowest emission intensity in Alberta. However, we recognize that while we have achieved much, there is more work ahead.”

ENMAX Energy’s generation fleet efficiency program is cutting greenhouse gas (GHG) emissions and bringing its operations closer to Net Zero. The company’s innovative approach toward its Net Zero goals include introducing Canada’s first hybrid electric gas turbine at the Crossfield Energy Centre, a project funded in part by Emissions Reduction Alberta. This unique technology combines a battery energy storage system with an existing natural gas-fueled turbine to provide standby electricity without burning additional fuel.

Commercial operation began in May 2021 and is anticipated to reduce the run time of the turbine by approximately 80% from its

original operations. This avoids an estimated 45,000 tonnes of GHG emissions annually—the equivalent of taking approximately 10,000 cars off the road.

“ENMAX Energy is taking a leadership role in building Alberta's lower carbon future since this hybrid technol ogy can serve as a model for other natural gas facilities throughout Canada,” Conlin said.

ENMAX Energy also upgraded the turbines at its Shepard Energy Centre, adding leading-edge technology to increase output and improve efficiency. In addition, the team completed a 44-day planned outage at the facility—the largest and most complex in ENMAX history—safely and ahead of schedule. This year, ENMAX Energy is planning a turbine upgrade at the Calgary Energy Centre and expects similar facility efficiency improvements.

ENMAX Energy has always prioritized environmental stewardship, having reduced GHG emissions by 65% since 2015 (based on our 2020 GHG emissions inventory) and now progresses towards its goal of reducing or offsetting 70% of its 2015 emissions by 2030.

“ENMAX Energy continues to focus on developing new opportuni ties to reduce our carbon footprint as we work towards achieving Net Zero by 2050,” Conlin said. “We will continue innovating for a low carbon future across our generation assets.”

Powering a Sustainable Future for People and Planet

Sian Barraclough

Vice President, Strategy & Sustainability, Capital Power

As a team of power generation experts and innovators, Capital Power is passionately working to electrify our world reliably and affordably, all while protecting the planet for future genera tions. To build the carbon-neutral energy system required for our future, we are accelerating our decarbonization efforts by putting shovels in the ground today. We are helping Canada reach its Net Zero electricity grid goal by increasing efficiency and reducing emissions – with the aim to eventually mitigate them altogether from thermal baseload generation, while also expanding our renewables portfolio.

In Alberta, Capital Power is deploying game-changing technologies to decarbonize thermal power generation and move off coal sixyears ahead of the government mandate. At the Genesee Generat ing Station, we’re investing ~$1.2 billion to repower two of the three units to utilize best-in-class natural gas combined cycle technology and convert the supercritical unit to 100% natural gas. Construc tion is well underway on this project which will add 560 megawatts (MW) of net capacity, resulting in 1,360 MW of baseload generation capacity. This project will also feature a 210 MW Battery Energy Storage System to allow these high-caliber units to operate up to their baseload capacity. With an eye to the future, the new units

Capital Power has invested in are hydrogen-capable and carbon capture-ready – ensuring this facility is agile and ready to apply the latest decarbonization solutions.

This significant investment in Alberta’s energy future will result in a ~3.4 million tonnes per year reduction in GHG emissions from 2019 levels, while providing reliable and affordable power long into the future.

To further reduce emissions from this facility, our innovators are developing a carbon capture and sequestration (CCS) project, which could start capturing 90% of the carbon emitted from Gen esee Units 1 and 2 as early as 2027. The Genesee CCS project is expected to deliver up to an additional 3 million tonnes of annual CO2 reductions. Capital Power is also collaborating with Enbridge on its proposal to develop an open access carbon hub near our Genesee facility to sequester our captured emissions.

As a leading renewable developer, we’re also adding wind and solar capacity to Alberta’s grid. In 2021, we completed the expansion of our Whitla Wind project – making it Alberta’s largest wind facility at 353 MW. Our 40.5 MW Strathmore Solar project is expected to begin operations in spring 2022 and construction is underway on our 75 MW Enchant Solar project. We have also announced plans to move forward with a 151 MW expansion of our Halkirk Wind facility in Alberta. Together, these new solar projects and wind expansion represent more than a $700 million investment in renewable energy.

Our team is passionately tackling climate change head-on, innovating baseload generation, expanding renewable capacity and collaborating with our communities to build a brighter future. We are proud to be powering a sustainable future for Canada!

Managing Risk in Hard Markets

Vanna Willerton

Legal & Finance Program Administrator, Electricity Canada

The Canadian insurance industry is currently in a difficult position – what is known as a “hard market”. Insurers are facing low invest ment returns and there is a surge in claim payouts, all of which leads to price adjustments in order to secure enough cash to protect customers. In hard market situations like these, insurers often pull out of certain high-risk activities or industries altogether, making it difficult for insurance buyers to maintain the same coverage at the costs they’re used to.

The cause for the current hard market can be attributed in large part due to an increase in natural catastrophes and the subsequent surge in insurance payouts. According to the Insurance Bureau of Canada (IBC), in 2021 severe weather led to 2.1 billion dollars in insured damage in Canada alone. The hardening market worsened in 2020 when the surge in claims was coupled with an economic downturn, leading to poor investment returns for insurers.

The hard market affects the Canadian and global insurance indus try as a whole. However, electricity companies are particularly hard hit due to their regulatory structure. If insurance rates increase dramatically during a regulatory period, these excess costs can’t be recovered, impacting the economic feasibility of major projects.

This is a serious concern for Canada’s electricity companies as they work toward decarbonizing, reinforcing their aging infrastruc ture against extreme weather, and electrifying the economy.

Here is the good news: this won’t last forever.

The last hard market took place roughly twenty years ago and the insurance market has historically cycled through many periods of soft and hard markets and back again. The economy is predicted to bounce back shortly, which will drive a softening of the market. However, we can expect extreme weather events to continue to

increase. Climate change has driven us outside of historical norms when it comes to severe weather, and since insurance rates are based on historical data, it is unclear how this will continue to affect the insurance market in the coming years.

Cyber liability is the other new and unpredictable line of insurance which will continue to remain an outlier as the market softens. A lack of historical data makes it difficult to determine and negotiate insurance. Cyber attacks, most frequently ransomware attacks, are only increasing in frequency and sophistication. Gord Payne, Direc tor of Risk Management for Fortis Inc. and insurance negotiator for the company, identified cyber liability as the most challenging line for Fortis Inc., “As cyber liability insurance matures it will likely stabilize, but I’m not sure we’ve seen the worst of it yet.”

In the face of this additional financial challenge to our Net Zero goals, governments, regulators, and utilities themselves should do everything they can to improve utilities’ resilience to extreme weather and cyber attacks. This will have the benefit of improving utilities’ abilities to serve Canadians, and of allowing utilities to negotiate better insurance rates – translating to customer savings and more funds to accelerate decarbonization projects.

What Can Utilities Do?

Demonstrate that You Proactively Manage Risk:

As underwriters tighten certain terms and conditions, they will look to ensure you have done your part to mitigate risks. The Insurance Bureau of Canada has risk management resources to help businesses put together their best insurable story to get the best possible rates. This is a free service to assist companies in identifying and addressing issues to reach insurance savings. Gord Payne states that, for Fortis Inc., “the underwriting submission is our corporate resume”. He recommends utilities work with a broker and provide as much information as possible about the company’s risks and mitigation tactics. In hard markets, insurers tend to have top-down mandates and decision-making becomes more central ized. Underwriters likely have less flexibility than before, so Payne emphasizes that underwriters, trying to make exceptions for your business, need to be provided with as much information as possible in order to make a case to their superiors.

Shop for New Insurance Company:

If you still feel that you are paying too much for your insurance, try to shop around for other options. Keep in mind that the market is hard and that companies tend to prioritize existing relationships

under such conditions. Knowing this, you should not restrict your self, and be ready to consider all options.

What Can Regulators Do?

Be aware: Regulators should be aware and make efforts to understand the hard insurance market. Most people at the table negotiating rates would not have seen the last hard market. Large peaks in insurance costs may raise questions for regulators, so understand ing what is inside and outside of utilities’ control will be the key to facilitating conversations.

What Can Governments Do?

Assist Electric Utilities in Climate Adaptation and Cyber Security Investments:

Federal and Provincial governments should recognize that utilities will need to invest heavily upfront in climate adaptation and cyber security in order to ensure that the system remains cost-effective and resilient. These investments will protect the grid and keep insurance rates reasonable moving forward.

Federal and local governments should work with stakeholders to accelerate current efforts to understand long-term climate variabil ity projections and facilitate utility investments in climate change adaptation and grid resiliency.

In the Government’s recent report: Canada in a Changing Climate: National Issues , increased awareness and technological innova tion are critical first steps in developing a climate-resilient energy sector. The government should conduct a national assessment of Canada’s climate change adaption needs in the energy sector and create an Energy Climate Adaptation Fund.

The government should provide further funding for research, development, and deployment of cyber security programs and technologies for the electricity sector.

Proactive management of cyber and climate risks keep insurance costs manageable and can be facilitated by federal and local governments.

Our Moon Shot: Hydro Ottawa to be Net Zero by 2030

Morgan Barnes and Susan Fekete

Media and Public Affairs Advisor & Communications Advisor, Hydro Ottawa

In December 2021, Hydro Ottawa, with the support of its Board of Directors, announced it was accelerating its transition to Net Zero operations by 2030. When it succeeds in its eight-year mission, it could be the first municipally-owned utility company in Canada to boldly go where no other has gone before.

“This is our moon shot,” says Bryce Conrad, President and CEO of Hydro Ottawa.

Conrad is referencing the 1969 moon landing of Apollo 11; a source of inspiration behind the utility’s announcement. Back in 1961, then President, John F. Kennedy announced in Congress that before the decade was over, the United States would land a man on the moon and safely return him back to earth. At the time, it had never been done, and the technology, technically, didn’t yet exist to make it happen.

What they did have was acceptance of the idea - which gained momentum and inspired a nation to persevere, get creative, collaborate, and secure necessary investments to move forward and succeed.

Making the ‘Impossible’ Possible

Experts have said the same thing with respect to Canada’s ambitious goal to be Net Zero by 2050 and the push for electrifi cation. While the technology exists to get us close, some of what’s required to get us to the finish line hasn’t been invented yet. Conrad believes that when there is a social need for change, technology, financing and regulatory reform isn’t far behind to help make the ‘impossible’ possible.

“There is no ‘business as usual’ for us anymore,” says Conrad. “In Ottawa, climate change is very real. In the last few years alone, we’ve lived through ice storms, floods, tornadoes, heat waves and major wind storms.

The societal pressure to address climate change is the rocket fuel that’s going to drive new technology and innovation in the energy sector. We may be shoot ing for the moon, but we’re also following the science to get there.”

For about a decade, the utility has been integrating innovative and sustainable business practices while also ensuring it continues delivering on critical areas of performance including, best in-class customer service, financial strength, organizational effectiveness, culture and leadership, and corporate citizenship.

In addition to being recognized as Ontario’s largest municipaly -owned producer of green power and being selected ten times as one of Canada’s Greenest Employers, two of Hydro Ottawa’s inno vative sustainability projects were awarded to Electricity Canada’s Centre of Excellence in 2021. Namely a new pollinator meadow in Ottawa’s south-end, and the company’s zero-carbon Zibi Commu nity Utility in the downtown core. Definitely not ‘business as usual’ for a local utility.

“Achieving the distinguished Sustainable Electricity Company designation from Electricity Canada, the third in Ontario to do so, became our North Star,” says Conrad. “Reaching that destination together as a team, it sealed the deal for me with respect to setting an unflinching timeline for our Net Zero goal. It’s going to happen and we’re going to achieve it together, because we have the best and the brightest.”

Customers Remain at the Centre of a Smart Energy Future

The company is currently developing a detailed action plan to guide its course to Net Zero, working with customers, employees and partners along the way. Conrad is quick to point out that the customer will always remain at the centre of everything the company does.

“As the electricity landscape continues to transform, the key is to do it in such a way that it is equitable and affordable for all cus tomers to participate in a smart energy future,” says Conrad. “By ensuring we have the proper support in place to help custom ers realize their sustainability and Net Zero goals, we will reach ours. No one can be left behind.”

While the electricity industry is often singled-out in conversations surrounding climate change, more than 80% of the electricity in Canada comes from non-emitting sources (Ontario’s electric ity sector is one of the cleanest in the world, producing 94 % of electricity completely free of GHG emissions) 1. Conrad believes that utilities are going to help shape the world’s energy future; with Canadian utilities at the forefront of the movement to decarbonize the Canadian electricity system by 2035.

“You can’t always wait for governments or others to act first,” says Conrad. “You have to take responsibility for your own operations and environmental footprint. Now is the time for clear and decisive action - and yes, to shoot for the moon, too.”

Hydro Ottawa owns and operates three primary subsidiaries: Hydro Ottawa Limited, which distributes electricity across the nation’s capital; Portage Power, which has over 128 megawatts of installed green generation capacity – enough to power 107,000 homes annually; and Envari Holding Inc., which offers large-scale sustainable energy solutions for businesses, governments and utilities.

Defining the End Game: Customer Ownership and

Customer expectations have branched beyond traditional indus tries into the utilities sector, and companies are hastening to respond. Rooftop solar, microgrids, battery storage, usage apps and smart-grid capabilities are already part of the here and now. This is just the beginning. Emerging technologies will continue to transform how we think about, use and share the power that fuels so many of our daily needs.

At Liberty, these advancements are informing our plans as we strive for a low-carbon future, and through our regulated and renewables business groups, we’re working closely with our cus tomers and communities to make that transition happen.

It Starts With The Grid

“I think of the grid like a vast transportation system,” says Sam McGarrah, Liberty’s Director of System Performance. “You keep the roads updated, install new interchanges, add lanes, and clear any accidents as quickly as possible. The goal is to minimize dis ruption. In essence, ensure everything flows.”

In recent years, harsher weather events have made it extremely challenging to avoid disruptions to the flow. Major outages due to storms, wildfires and other natural disasters have highlighted the criticality of employing alternative backup energy sources

like battery storage derived from both traditional and renewable sources such as wind, solar and hydro. At the grid level, these solutions, combined with smart grid capabilities, can drastically reduce downtimes.

But the need goes deeper than that. Customers want uninterrupted power supply – they expect it, and they also want more visibility so they can better manage their consumption and costs. This new concept of “customer ownership” is one that Liberty is avidly pursuing.

Lindsay Maruncic, Liberty’s Director of Renewable Energy Oper ations, explains: “Our goal is to find ways to create resiliency for our customers while still driving to Net Zero. One way is to partner with our critical customers and facilities like schools, hospitals and grocery stores and supply them with behind-the-meter batteries to be used when there is an emergency. When those batteries aren’t being used, we could access them for other energy needs.”

For residential customers who invest in battery storage, they can actively view and manage consumption, in real-time. Eventually, this can lead to even more control with the incorporation of predictive capabilities that will allow customers to see, in advance, their daily energy usage patterns, and adjust for optimal efficiency.

This type of thinking – with the customer as an active participant in defining the solutions – is changing utilities’ relationships with their customers, and our interactions with them.

Partnering For Shared Benefits Via Green Solutions

Wind and solar power are perhaps the best-known sources of clean, renewable energy. Algonquin, the parent company of Liberty, built its first wind farm in 2004 in Manitoba, and today has over 4,000 MW of renewable generation in operation. Partnering with major power-purchasers such as Kimberly-Clark, General Mills and JPMorgan Chase, creates a win-win-win scenario for the environ ment, the local communities, and the companies with their individ ual ESG targets.

In California, where the drive to zero carbon is spurred by federal goals, Liberty’s customers are already being served by 100% solar power during the day much of the time. For evening and peak times, the 50MW Luning Solar Energy Center – the first of its kind in the

state – and the 10MW Turquoise Solar Facility, kick in to help meet the demand.

Liberty’s Manager of Operations in Arizona, Terry Gilbertson, describes how solar installations with a battery backup are off setting power consumption at the Palm Valley Water Reclamation Facility, helping to reduce the cost of kilowatts while furthering sus tainability goals. “The interplay of energy and water is an important one: standard power generation requires a great deal of water. So, finding ways to reduce water consumption in the energy genera tion and distribution processes is key.”

But augmenting the grid with renewable energy sources is not a one-and-done solution. In fact, our current transmission systems don’t have the capacity to manage all the existing wind, solar and hydro generation, let alone additional megawatts flowing in. So, we must think even bigger.

Energy Interdependence and the Potential of Hydrogen

One of the newer kids on the block in the renewables game, hydrogen, presents potential opportunities for energy and redun dancy. Hydrogen technologies can act like a shortcut by providing customers with the power they need without building more trans mission lines. Trish Walker, Liberty’s Director of Business Develop ment, calls hydrogen “the Swiss army knife of renewable fuel” as it links electricity, natural gas, water and wastewater operations.

As Trish notes, green hydrogen can be used to completely decar bonize a building’s use of heat and power through wind, solar and hydro sources. In comparison to traditional battery storage, hydro gen fuel cells are lighter and easier to use, and can be adapted to existing systems. For example, hydrogen-adaptive turbines can be used to create redundancy for when the wind isn’t blowing. Or, when there is excess demand on the grid, energy stored in hydro gen form can be tapped.

For Liberty, hydrogen is a technology that we are currently inves tigating. For industries that cannot decarbonize, or where decar bonization is seriously hampered by the nature of their operations, hydrogen may prove to be one of the keys that unlocks that door.

Beyond Emissions Reduction

Meeting corporate Net Zero goals will take more than new technol ogies. Workforce projections have shown that by 2050 there will be roles that we can’t even envision today – roles that will be critical in getting us to and supporting a low-carbon economy. How can anyone plan with such unknowns?

Kirsten Olsen, Liberty’s Chief Human Resources Officer, says, “To prepare for the future now, we need to think more broadly than traditional skillsets and use different talent strategies. Core skills such as engineering and business acumen will remain important, but even more critical will be the ability to pivot quickly to address a difficult situation, and to do so with an entrepreneur ial attitude. It will be less about formal education and more about adaptability, mindset.”

Liberty’s closure of its Asbury Coal Plant in the U.S. Mid-West and completion of approximately 600 MW of new wind generation shows that thinking in action. The plant closure reduced emissions by nearly one million metric tonnes and increased local economic development. With the company’s guiding principles of continuous learning and entrepreneurial spirit leading the planning, the Asbury plant retirement and transition to wind power provided an ideal opportunity to test the team’s ability to adapt and excel.

“Fundamentally, our Net Zero strategy is to continue to deploy existing technologies like converting to renewable generation where possible, while exploring new solutions that are a bit further down the road,” notes Ariel Bautista, Liberty’s Director of Sustainability.

Finding the “Sweet Spot”

Ultimately, our energy future hinges on finding the connection point between what customers want, what’s good for the environment, and what’s sustainable for companies with shareholder and Net Zero commitments – the sweet spot of experience, efficiency and value.

For example, if a utility customer installs battery backup and roof top solar in their home, although this is a step in the right direction, this will change their service needs and relationship with their utility, which poses new challenges. How do we work together to ensure everyone’s investment is maximized, and we don’t spend double on that same energy usage? How do we optimize this much bigger energy network? How do we incorporate new solutions within our current infrastructure to yield the best from both? How do we ensure that individuals who cannot afford rooftop solar are not negatively impacted?

As our energy sources continue to evolve and new ones emerge, more questions will surface. By actively engaging our customers in these discussions, and co-creating the path to a greener future, reaching our goal of a low-carbon economy is far more attainable. As Kirsten Olsen notes, “The path has yet to be defined – we need people with a passion for finding solutions to figure this out with us. The power truly is in all our hands.”

Cultivating the ‘Green-Force’: Electricity Sector Hiring in the 21st Century

Michelle Branigan CEO, Electricity Human Resources Canada

The shift towards cleaner forms of electricity generation such as renewables (solar, wind, hydro, marine tidal, and biomass), coupled with the emergence of innovative technologies like small modular reactors and compounded by fluctuating demographics, has left the electricity workforce with an uncertain future.

Our sector is the largest employer of utility workers in Canada — employing over 100,000 people. While these numbers may seem promising, there is a critical problem: only 5% of the labour force is under 25 years of age, compared to 14% in all other industries. As retirement rates in the sector continue to double the national average and electrification ramps up, it is urgent that the electricity sector begins to attract young and diverse talent.

Power demand is set to rise significantly over the coming decades as our economy becomes increasingly electrified. And with new electrification technologies emerging, as well as the need to meet

multiple national and international energy goals such as the 2015 Paris Agreement and the Government of Canada’s strengthened climate plan , a large upheaval looms. Unless we address the sec tor’s shortage of skilled workers , Canada gambles with the ability to meet its environmental targets.

How can we bolster the electricity workforce in Canada to power the energy systems of our future and ultimately create a successful electrification response? The answer is simple: identify the potential and act accordingly.

An Inclusive Future

No matter what industry you’re in, there’s no question that a focus on diversity, equity, and inclusion (DEI) is paramount in attracting and retaining a full range of qualified professionals. Electricity is an innovative sector, but innovation can only flourish in an environment that encourages diverse perspectives.

A 2021 Government of Canada survey revealed that women make up just 26% of executive leaders in the global energy sector. Nationally, we are facing similar issues. Electricity Human Resource Canada’s (EHRC) Leadershift: Pathways to Gender Equity report concluded that almost half (46%) of the companies surveyed had no women listed in C-suite positions. Even more alarming is that only 7% of women on energy sector boards and executive teams identified as Black, Indigenous or People of Colour (BIPOC).

Additionally, EHRC’s 2020 Generation Impact: Future Workforce Perspectives report found that while Indigenous youth are substan tially more likely than others to consider a career in the electricity sector, they are wholly underrepresented within its workforce. According to Statistics Canada, landed immigrants made up the majority (66%) of employment gains between 2016 and 2017; Indig enous peoples are the fastest-growing population in Canada with nearly 45% of Canada’s Indigenous population under 25 years of age, compared to 28% in the rest of Canada; in 2018 women made up nearly 48% of the Canadian workforce and there are currently 645,000 Canadians living with disabilities who have the potential to work in an inclusive labour market but are not currently doing so.

There is no question that diversity is the future, and that the energy sector needs to follow suit.

“As a sector that employs so many Canadians from coast to coast, we must take a leadership stance in changing our demographics [...] In order to address climate change, our industry will be called upon to lead the decarbonization of the broader economy. This requires attracting the best and the brightest minds by being the employer of choice and by providing a workplace where everyone belongs,” says Ken Hartwick, CEO of Ontario Power Generation. “We work closely with EHRC in preparing the industry to be futureready and having the best and most talented people working in this sector.”

To change our demographics, however, we first need to anticipate and mitigate common systemic barriers faced in the recruiting, hiring, onboarding, and retention processes. One way that many Canadian organizations are addressing this is by becoming a

signatory to commitments focused on advancing, integrating, and prioritizing DEI in the workplace. The Leadership Accord on Diversity, Equity and Inclusion is one such commitment in which electricity sector organizations, their leaders, and members can become a part of united action to:

• expand the breadth and depth of the skilled workforce;

• ensure that underrepresented groups are informed of opportunities available in the sector of their choice; and,

• fully support and provide all individuals with equal opportunities to grow and develop to their full potential, once employed.

Empowering Youth

While Millennials and Gen-Zers believe that climate change is an important issue and want the opportunity to be part of the solution, young people make up far less of the electricity workforce than other sectors. By educating youth about the possibilities available to them, providing work-integrated learning (WIL) opportunities, and investing in apprenticeships, we can recruit the skilled talent necessary for a labour force for the future.

EHRC has developed several programs that make attracting new talent easier, and financially feasible. One such program is Empow ering Futures , a Work Integrated Learning (WIL) opportunity in which co-op students work alongside skilled industry professionals who help prepare them for a future career. To incentivize employ ers, the program offers a $7,500 per student wage subsidy. The Discovering Potential program which supports employers prepar ing young workers via internships and on-the-job training provides up to $25,000 per participant. These programs offer tangible opportunities for employers to attract and integrate new talent.

Ultimately, what may prove most important in the success of recruitment and retention efforts is the ability for organizations to position themselves as an employer of choice; in a 2019 labour market intelligence study, 60% of electricity employers reported that they were in direct competition for labour. And with an incred ibly tight labour market, we are now competing with every other industry across Canada for talent. Beyond its intrinsic value, using a DEI lens, along with generation-focused messaging and learning opportunities, can help to create an important competitive edge.

If what our country wants is a greener future, then the energy sector needs an influx of qualified workers, and fast. The skilled labour force of the future is out there. Their potential remains to be discovered, developed, and deployed by us.

Interest Deductibility Limit and the Utility Industry

Daniel Gent

Director of Risk, Reliability and Resiliency, Electricity Canada

In budget 2021, there was one item that concerned electricity com pany tax specialists: Interest Deductibility Limitation, or sometimes referred to as the Earnings Stripping Rule. The draft legislation that was proposed in the budget states that starting in 2023, “the limit of interest that ‘certain’ businesses can deduct be limited to 40% of earnings in the first year of the measure, and 30% thereafter.” This tax measure is a component of the OECD Base Erosion and Profit Shifting (BEPS) Project.

The electricity industry is very complex and electricity companies exist in very different operating environments than other busi nesses. The draft legislation, which was released in early February of 2022, currently fails to take into account these significant differ ences. The electricity industry is unique in in the following ways:

• The electricity sector is a highly capital intensive one, with long economic life periods of up to 40 years on capital investment.

• Electricity Canada members require substantial ongoing infrastructure spending to ensure safe and reliable generation and delivery of electricity to customers.

• Electricity companies must also ensure new infrastructure investments meet increasing customer demands.

• The electricity sector will be required to meet Canada's emission reduction targets by investing in new, clean, and efficient technologies.

• The electricity industry is a highly regulated one which adheres to provincial economic regulatory frameworks. Utility companies are regulated with publicly approved return on equity (ROE) levels.

The above-mentioned points make the industry particularly vulnerable to the proposed changes to interest deductibility limits. Long-term debt financing is a necessary part of business, because it is a more cost-effective means to finance large capital invest ments, compared to the higher upfront costs of equity financing. Electricity companies expect to use interest deductions to lower the net financing cost of large infrastructure projects which avoids the alternative of raising costs for consumers. The ability to do this helps to ensure affordable rates for Canadians.

Additionally, the proposed changes mean it will cost more to build the infrastructure required to meet our Net Zero targets, and it will cost more to strengthen the grid in the face of extreme weather events and cyber attacks. Electricity companies will be forced to examine their debt, rate filings, and interest rates, and incorporate increased taxes into rate filings. Ultimately, the Interest Deductibil ity Limitation will lead to an increase in electricity rates for Cana dian customers.

For these reasons, Electricity Canada believes that regulated utili ties need to be exempt from this draft legislation. Such an approach would mirror the one taken by the United States in 2017, where electricity and natural gas utilities were provided with an exemption from interest deductibility legislation. This would also be consistent with other international tax norms and practices.

The federal government needs to understand that electricity and gas utilities are very different from the way other businesses operate.

The electricity sector is the economic backbone of Canada, and it is critical to reaching our Net Zero targets. In order to acceler ate our energy future, and to ensure customers continue to have access to clean, safe and affordable electricity, this new draft legis lation should include an exemption for electricity companies.

Flux Capacitor Podcast

A podcast about the future of electricity. The Flux Capacitor podcast features discussions with business and thought leaders of the electricity industry on the future of the business of electricity. The discussions touch on how we create, move, trade, and use energy, with each guest adding their own expertise and perspective to the conversation.

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The Time to Act is Now

Aaron Del Pino

Vice President of Environment, Health & Safety, Ontario Power Generation

Now is the time to start looking at climate change differently. We must view climate change as a catalyst for positive and innovative action; where each of us has the ability to influence our climate for the better. At Ontario Power Generation (OPG), we are actively taking steps to address the negative effects of climate change, through positive impacts , right now.

As a member of the electricity industry, we believe it is our collective responsibility to develop actions to improve the way we produce power, generate economic opportunities, and nurture new, innovative ideas with both short and long-term potential and impact.

Being one of the largest clean energy generators in North America, we are in the unique position to leverage our relationships with Ontario’s talented workforce, strong supply chain and operational experience, to position our electricity system to be a formidable and world-class adversary in the battle against climate change. OPG’s operations span across Ontario and various parts of the U.S., including a diverse portfolio of hydro, nuclear, solar, biomass, and natural gas generating assets.

In 2020, we released our first ever Climate Change Action Plan , outlining clear actions and goals to achieve a Net Zero future.

Our goals are simple: become a Net Zero company by 2040 and help to enable a Net Zero economy by 2050.

Over the past year, we have completed a number of tangible actions to achieve these goals; these are not just hopeful plans but real changes that will yield outcomes in the short-term.

Recently, OPG made a significant announcement on the future of Canada’s first grid-scale Small Modular Reactor (SMR). We will work together with GE Hitachi Nuclear Energy to deploy a BWRX300 SMR at the Darlington new nuclear site; the only site in Canada currently licensed for a new nuclear build, as early as 2028, pending regulatory approvals. This action alone could prevent 2 megatonnes of carbon dioxide emissions per year.

Additionally, OPG is working closely with SaskPower, New Brunswick Power, and Bruce Power to develop a pan-Canadian approach to deploying SMR technologies. SMRs have tremendous environmental and economic potential to help Indigenous commu nities and fossil fuel-dependent regions. In Canada alone, nuclear power helps avoid 80 million tonnes of carbon emissions per year, and in combination with renewables, the carbon offset is the equiv alent of taking half the world’s passenger vehicles off the road.

Aside from building new nuclear capacity, Ontario is working to maximize the potential of its existing nuclear fleet by investing ~$25 billion into refurbishing the Bruce and Darlington Nuclear Generating Stations, with both projects tracking on time and on budget. As some of Canada’s largest clean energy projects, these refurbishments will provide Ontario with 30 more years of car bon-free nuclear power to support our electrification efforts and growing energy demands.

By investing in our existing nuclear fleet and positioning it for future growth by way of SMRs, nuclear power will act as a key enabler for additional forms of renewable power generation and clean energy products.

Besides the environmental benefits, the Canadian nuclear industry contributes more than $6 billion annually to the country’s GDP, generates $1.5 billion in federal and provincial taxes, and sup ports 60,000 jobs and a strong nuclear supply chain of over 200 companies.

The Organisation for Economic Co-operation and Development (OECD) estimates the nuclear power output will need to double globally by mid-century to meet the 2050 Net Zero emission goals. With the advancement of electrification within the province, OPG forecasts Ontario’s demand for clean energy could increase by 40% by 2040.

This corresponds with the IESO’s Annual Planning Outlook (APO) released in December of 2021, which forecasts electricity demand, assesses the reliability of the electricity system, and identifies capacity and energy needs for Ontario.

Simply put, there would be no path for the world to reach Net Zero without nuclear. To meet the increasing electricity demands, clean, reliable nuclear power must be included within a diverse energy mix. This mix of generation will enable the decarbonization of the broader economy, including the electrification of transportation.

OPG has continued to expand our Ivy Charging Network , which will soon be the largest EV fast-charging network in Ontario with 160 chargers across 60-plus sites. OPG is also supporting Ontario’s electrification through the Wolfe and Amherst Island eFerries , and

recently launched a new subsidiary, PowerON Energy Solutions . PowerON provides electrification and charging infrastructure for municipal transit agencies and corporate fleets. PowerON is currently working with the Toronto Transit Commission (TTC) to electrify more than 2,400 TTC buses

Another OPG subsidiary, Atura Power, recently selected the Niag ara region as its first potential Ontario site for large-scale hydrogen production. It is expected that Niagara will be a prominent green hydrogen hub for heavy-duty trucking, municipal mobility, and heavy industrial consumers in Ontario. The benefits will include local and provincial economic growth through investment, jobs and development of the first large-scale green hydrogen hub in Ontario.

“The steps we take to address climate change today must improve the lives of everyone and make communities stronger and more resilient,” said Ken Hartwick, President & CEO of OPG. “We will create new jobs and nurture new industries to make life better, not just for future generations but for current generations as well.”

If we are striving to address climate change and improve our com munities, it will take more than just enhancing our electricity system to be successful. It will also be about developing, fostering and sustaining positive relationships with Indigenous and other host communities across the province.

We recognize and respect that all of OPG’s generating assets are located on the treaty lands and traditional territories of Indigenous peoples across the province. Recently, OPG outlined its plan to ensure building and maintaining these relationships is a priority woven into every facet of our business.

OPG’s Reconciliation Action Plan (RAP) is our blueprint for how we intend to work in partnership with Indigenous communities, busi nesses and organizations to advance reconciliation. The RAP will serve as a roadmap to reconciliation, with goals that require collab oration with Indigenous communities, post-secondary institutions, vendors and many others to see successful, mutually-beneficial outcomes and deliverables.

The only way we can change our climate for the better is if we do it together.

If we want a future where innovative technology and advance ments, such as the electrification of industrial processes and trans portation, are a reality, there will then be significant requirements for additional clean energy technologies including nuclear, hydro, hydrogen, and others to lead the charge in making it happenboth in Canada and abroad.

Economies around the world have less than 30 years to cut overall carbon emissions to Net Zero. Let us seize this ‘opportunity’ and take it for all we can; to clean the air, water and land, to build economic security, to develop relationships and partnerships. It is time to stop thinking about climate change actions we can do in the future, because the future is now.

Centre of Excellence

Shaping the future

Electricity. It’s the magic we take for granted but rely on every day.

Electricity Canada’s Centre of Excellence celebrates Canadian innovation and cutting-edge technology in the electricity sector. Whether it’s a virtual power plant providing residential customers with the ability to generate their own clean energy and augment the grid, or the world’s first commercialscale post-combustion carbon capture and storage unit – all Centre of Excellence projects are positively impacting the lives of Canadians and shaping our collective energy future.

Explore More Innovation Excellence at electricity.ca/innovation

Electricity Canada:

A ‘Made in Ontario’ Power Solution

John Mikkelsen Project Manager, TC Energy

As Ontario seeks to drive to Net Zero emissions to meet climate change goals, new solutions are needed and are being developed. The Ontario Pumped Storage Project is one such example.

The Need

The most recent Annual Planning Outlook of the Ontario Indepen dent Electricity System Operator (IESO) indicates that electricity demand is forecasted to rise at rates not seen in many years. Economic growth is driving the increased demand, and as a result, uncertainty. Long-duration storage, specifically pumped hydro storage, could play a key role in bridging the gap in an economical and environmentally responsible way.

Pumped hydro storage, which has been used for more than a century around the world, involves pumping water from a low-lying reservoir to a higher-elevation reservoir. This typically happens during periods of low demand for electricity, usually at night. When electricity demand is greater, typically during the day, water is returned to the lower reservoir through turbines that generate electricity, like hydropower from dams.

More than 160,000 megawatts (MW) of pumped storage capacity currently exists worldwide, including 165 MW in Ontario. Pumped storage accounts for 95% of global energy storage, and there are more than 100 projects planned or currently under construction.

The Nuclear Innovation Institute’s January 2022 report, Store of Value, underscores the need for additional energy storage in the province of Ontario: “The combination of nuclear and increased levels of energy storage would give electricity system operators a clean alternative to the current practice of using gas-fired elec tricity generation facilities to back-up intermittent sources like wind and solar and meeting peak demand, creating an on-demand supply of clean energy.”

The Project

Our ‘Made in Ontario’ Net Zero project will address the need for additional electricity generating capacity while also driving important climate-change progress. It is one of the largest climate-change initiatives being developed in Canada. The stateof-the-art design incorporates the latest and best technologies that protect the environment while advancing towards Canada’s 2030 target of 30% reduction in greenhouse gas emissions. At 1,000 MW, the proposed project will be the province’s largest stor age asset, storing enough clean carbon-free electricity to power nearly a million homes. As proposed, the facility would be sited on a small portion of the Canadian Army’s 4th Canadian Division Train ing Centre, north of Meaford, Ontario.

The Opportunities

This project will save Ontario ratepayers $250 million per year, create 1,000 jobs during development and construction, and drive economic stimulus locally, provincially and nationally. In addition, the project offers a commercial partnership opportunity for the Saugeen Ojibway Nation, upon whose territory the project is situated. The project is consistent with the Canada Infrastructure Bank’s mandate to support projects with meaningful Indigenous community participation while advancing clean energy targets.

TC Energy is proposing to design, construct and operate a gridscale energy storage facility for Ontario’s electricity system, pro viding the needed capacity for the province. This project will not only help to reduce electricity costs and green-house gas emissions, but also support economic recovery, and provide stor age for Ontario’s excess baseload generation.

Collaborating to Power a Better Tomorrow

Larisa Morton, Gulnar Joshi, and Fanny Guevara

Alectra Green Energy and Technology Centre (GRE&T Centre)

The ongoing IESO York Region Non-Wires Alternatives (NWAs) Demonstration project allows customer-owned resources to help manage the growing energy needs of their communities.

We are in the initial stages of changing the energy ecosystem. Distributed energy resources (DERs) – which include small-scale energy storage, combined heat and power facilities, demand response and renewables such rooftop solar – are transforming the energy landscape of Canada. As part of this transition, consumers and communities are choosing to play a more active role in energy planning and management, instead of relying on conventional electricity infrastructure.

Traditionally, when the forecast for electricity load growth exceeds existing grid capacity, new poles-and-wires infrastructure is built to meet new demand. However, in Ontario’s York Region, where electricity demand is growing rapidly and is expected to exceed system capability by 2030, the NWA project is exploring how a local electricity market can meet new demand with customerowned DERs over two years (October 2020 - October 2022).

Funded by the Independent Electricity System Operator (IESO) and Natural Resources Canada (NRCan), and delivered by Alectra

Utilities, the IESO York Region NWA Demonstration Project is North America’s first distribution level electricity market with encouraging results thus far.

A ‘Canada First’!

The project achieved a ‘Canada first’ in the fall of 2020, with the local capacity auction procuring a total of 10 megawatts (MW) of capacity from a wide variety of resources. These resources, owned and operated by manufacturers, supermarket operators, and resi dential participants, were procured with a clearing price of $0.64/ kilowatt-day ($80,000 MW/year). The procured resources were committed to being available for a six-month summer period (May 2021 - October 2021) to support the grid during demand peaks, by either generating electricity for the grid, or by reducing their consumption on demand.

Another ‘first’ was achieved in June 2021, when participant DERs were activated during a heatwave to help reduce local demand (4.5MW on June 7, 2021, and 3.6MW on June 28, 2021). This was the first time in Canada that DERs secured through a local capacity auction were used to help reduce local peak demand.

During the six-month period in the summer of 2021, the project saw eight activations that coincided with the warmest days of the year.

“The IESO NWA Demonstration Project has proven the potential for using local solutions as a cost-effective alternative to traditional electricity infrastructure,” said Brian Bentz, President and CEO of Alectra Inc, the participating utility.

The project successfully reduced peak demand at the local gridlevel, helping to ensure the reliability of the system wide-grid and potentially helping defer the need for traditional infrastructure. The participants benefited too, earning an average of $125,000 per MW of DER capacity; 65% of this sum for making their DERs available during the commitment period, and 35% for using their DERs to meet local energy needs during peak demand.

Summer of 2021

In year two of the project, the local capacity auction, which con cluded in October 2021, was expanded allowing participants with “reserve-capable” DERs – in other words, those who have the capability of delivering supply or reducing their consumption within 30 minutes – to help manage the grid during peak periods caused by unexpected events. A total of 15 MW of capacity (of which 6.8 MW is ‘reserve-capable’) was procured with a clearing price of $0.40/ kilowatt-day, lower than the cost of $0.64/ kilowatt-day from 2020.

“As Ontario electricity demand is forecast to increase this decade, we’re actively exploring the integration of DERs into local and provincial electricity systems,” said Lesley Gallinger, President and CEO of IESO. “Lessons learned from this demonstration project show us how local supply options can help keep the grid reliable and affordable.”

The project is already being recognized for its contributions to the industry's best practices and inspiring innovative thinking. In July 2021, the project was accorded the “Beyond Energy Efficiency” award by the Association of Energy Services Professionals (AESP).

In the context of the energy sector’s rapid evolution, it is great to see the IESO, NRCan, and Alectra Utilities demonstrating the power of locally owned DERs in managing communities’ energy needs. Projects like IESO York Region Non-Wires Alternatives Demonstration Project show that there is enormous potential for energy transformation in tandem with local communities, and how innovation and collaboration can help power the energy landscape of the future.

Canada: The Grid 2022

Powering More Together

Robin Yee

Manager of U.S. Affairs, Electricity Canada

So many shifts are taking place, and the pace of change is speeding up: climate change, remote work, pandemic measures, and security threats, just to name a few. More than ever, it’s important to pause and look at what we can draw on as we chart our course ahead. We can rely on engineering and technical improvements to drive efficiencies or aid problem-solving. We can use regulatory develop ments to enable new technologies and support our evolving priorities.

But perhaps the most important resource of all is a strong working relationship. Relationships, along with the complementary knowledge and the skillsets they bring, can provide great clarity during unprece dented times.

For over a century, Canadians and Americans have worked together to keep our shared electricity grid reliable, safe and secure. Through these crossborder institutions, we have developed a culture of information sharing and cooperation to protect our grid from threats such as cyber attacks and major storms. We have developed standards and best practices that keep our grid reliable. And crossborder transmission connections have allowed for a greater diversity of supply and have connected clean energy to demand.

This long-standing relationship has served both countries during the pandemic, accelerating learning opportunities and policy development in the elec tricity sector. This collaboration allowed electricity companies to quickly understand what worked, and what needed improvement. This cooperation will be essential in dealing with future events such as extreme weather, security threats, and decarbonization.

The Roadmap for a Renewed U.S.-Canada Partnership, announced last year outlined the need “to take a coordinated approach to acceler ating progress towards sustainable, resilient, and clean energy infrastructure, including encouraging the development of cross-border clean electricity transmission.”

The cross-border Great Northern Transmission Line is an example of this partnership. The line pairs new U.S. wind generation with Canadian hydro and transmission, offering benefits for both coun tries, including reliability, affordability, and clean energy advantages.

Canada’s predominantly clean, dispatchable baseload generation fleet can serve as backstop energy to U.S. variable renewables, such as solar and wind, supporting the further development of renewable generation, while providing reliability and resilience benefits to both countries. Canadian hydroelectric power allows U.S. variable renewables to sell excess electricity to Canada which allows hydro reservoirs to reserve water, which can be used to generate power to be sold to the U.S. when needed in the future.

As Canada and the U.S. continue to work together to build back better, there is no question that electricity will continue to play a central role in our combined economic growth and clean energy future. The Canada-U.S. electricity relationship can connect more clean and reliable electricity to demand, and achieve a shared vision of an even more sustainable, reliable, and affordable electricity future.

To learn more about this longstanding partnership, visit Electricity Canada’s Power More Together microsite: www.powermoretogether.com

Electricity Canada:

Clean Energy Accelerates

EV Travel in Newfoundland and Labrador

Janine McCarthy

Senior Communications Specialist, Newfoundland and Labrador Hydro

In Newfoundland and Labrador, approximately 85% of all electricity is generated from renewable sources such as hydro electricity. As jurisdictions worldwide look to clean energy solu tions to help reduce greenhouse gas emissions and slow the pace of climate change, our province is well-positioned to contribute to established targets and support a greener future.

Despite an abundance of clean energy to help power the trans portation sector, until recently Newfoundland and Labrador was the only province in Canada without a fast-charging network for electric vehicles. Although they have been on the market for some time, a lack of charging infrastructure has been a key barrier for consumers who are considering making the switch from a tradi tional gasoline-powered vehicle to an electric one. Purchasing a vehicle that could not be conveniently and quickly recharged for travel across our vast province was a major barrier for consumers in Newfoundland and Labrador.

Taking the Critical First Steps to EV Adoption

Newfoundland and Labrador Hydro has been operating our province’s electricity system for more than 50 years. As the provincial Crown utility, we’re focused on meeting customer needs today, while also planning for the future of our sector. Our mandate is to provide safe, reliable, and affordable electricity, and we believe electric vehicles have an important role to play in our electricity future.

That is why in 2020, Newfoundland and Labrador Hydro led the charge to increase electric vehicle use in the province. In partnership with the Government of Newfoundland and Labrador and Natural Resources Canada’s Zero-Emission Vehicle Infrastructure Program, we established the province’s first fast-charging network.

Supporting a Greener Future in Newfoundland and Labrador

Construction of the network was a critical first step toward making electric vehicle ownership a viable option for drivers in Newfound land and Labrador. Taking this step also links our province with an established network of fast-charging stations throughout Canada, completing a coast-to-coast network and contributing to the coun try’s overall climate change targets and commitments.

Since construction of the first 14 provincial charging locations was completed in summer 2021, the network has delivered 45.9 MWh of energy through more than 2,000 charging sessions, displacing close to 50 tonnes of greenhouse gas emissions through direct charging alone.

In addition to environment benefits, the fast-charging network also allows customers to use the clean, abundant and renewable power generated here at home, while contributing to our province’s elec trification and rate mitigation efforts. Indirectly, the network has opened the door to opportunities for electric vehicle education, awareness, purchase incentives and rebates, as well as EV-related tourism. Businesses and charging site hosts at locations along the network also benefit, not to mention, the fuel and maintenance savings for electric vehicle owners.

Development of this essential charging infrastructure has already helped pave the way for increased accessibility to more chargers in other regions of the province, with additional locations expected in 2022 and beyond. As we look to the evolution of electric vehicles in our province, Newfoundland and Labrador Hydro is proud of the role that we play to support a more sustainable future that is pow ered by clean, abundant and renewable energy.

Newfoundland and Labrador Hydro is the province’s Crown utility. We are a company of people who work hard behind the scenes because we know our customers are counting on us. Through our generation, transmission and distribution operations, we’re committed to meeting the needs of our customers and providing residents, businesses and communities across the province with safe, reliable power. For more information, visit www.nlhydro.com

Staying Connected: Redefining Mutual Assistance in a Virtual World

Aika Mbatia

Coordinator, Mutual Assistance Program, Electricity Canada

For almost a decade, Mutual Assistance agreements across North America have played a major role in strengthening and building resilience in the electricity sector. With the aim of providing a forum to ensure safe, effective, and coordinated Mutual Assistance, ini tiatives like the North Atlantic Mutual Assistance Group (NAMAG) have empowered member utilities to quickly action regional response and service restoration for their customers when hit by emergency events 1. Participating utilities in Canada have been able to send crews, tools and equipment freely, as well as build profes sional networks with our U.S. neighbours, where most of the need for mutual aid exists. While these agreements equipped electricity companies to share best practices and plan for other significant events such as work stoppage, civic unrest, or political events, no one was prepared or could have planned for a global pandemic.

Very quickly, the unidentified gaps within these agreements became evident as governments across the world, including Canada and the U.S., imposed mandates and restrictive measures to help prevent the spread of COVID-19 and ensure people’s safety. For existing Mutual Assistance agreements, these measures led to disruptions in utilities’ ability to guarantee a reliable and timely response, and increased the risk of lineworkers contract ing COVID-19 during deployment, especially for smaller utilities 2 Adjusting to this new reality meant having to redefine Mutual Assistance networks to address the rising need for a more central ized and fulsome presence across Canada. This sparked conver sations on creating regional Mutual Assistance groups aimed to improve the resiliency of the Canadian electricity sector through

strengthening members’ emergency management and Mutual Assistance capabilities by promoting inter-utility emergency management partnerships across Canada.

By virtue of its structure, Electricity Canada allows members to come together and work collaboratively even when separated by vast distances. With COVID-19 halting most of the Mutual Assis tance activities between the Canada-U.S. border, Electricity Can ada, in collaboration with Hydro One and Toronto Hydro, launched the Ontario Mutual Assistance Group (OnMAG) late in 2020, as a pilot initiative aiming to provide a single point-of-contact for utilities when requesting personnel or materials during emergencies. The shift to regionalized Mutual Assistance within the Canadian electricity sector was easily achieved through new technologi cal advancements in response to the COVID-19 pandemic which allowed for virtual work to be as productive as in person work. Thanks to this change, the close geographic proximity of members ensures a more efficient exchange and speedy response, with minimal disruptions as participants operate under the same set of standards.

On the weekend of December 11th, 2021, and into the following week, OnMAG was activated for the first time following a major winter storm and high winds that shook southern Ontario. Elec tricity Canada successfully facilitated the coordination of OnMAG member utilities that were collectively faced with power outages for 400,000+ customers. The coordination helped provide timely updates from both utilities requesting aid and those able to offer crews and equipment. Through the OnMAG program, the power to hundreds of thousands of customers was restored quickly and safely. We are extremely proud of the program and its potential.

The virtual tools adapted through the pandemic have improved the Mutual Assistance systems and promoted a more centralized approach where utilities of varying sizes across Ontario are guar anteed the ability to seek and offer coordinated assistance, as well as status updates within a short timeframe, while still ensuring the safety and wellbeing of their lineworkers during deployment. After a year-long pilot, OnMAG has now officially launched.

With the current challenges brought by climate change, there is a rising need for regionalized Mutual Assistance networks as utilities continue to face more hazardous weather events like storms, wildfires and floods requiring more manpower and resources for service restoration and minimizing disruptions to their customers.

Likewise, the growing shift to a Net Zero world, and rising conver sations on decarbonization and electrification calls for Canadian utilities to work closely together to provide sustainable electricity for all. Ultimately, as OnMAG continues to grow and more utilities continue to benefit from the coordinated Mutual Assistance net work, more agreements will be called for as utilities across Canada adapt to new regional assistance networks. You can find more information about OnMAG on Electricity Canada’s website

One Step Ahead

Leah Michalopulos

Director, Government Relations, Electricity Canada

Many of the articles in this magazine explain that Canada must accelerate investments, technologies, and regulatory improve ments to enable the electricity sector to meet clean energy goals and economy-wide net zero targets. Our predominantly and proudly clean electricity system is essential to grow a clean energy and inclusive economy, and to help other sectors decarbonize.

In this conversation, policy makers, thought leaders and regula tors must not forget about the importance of security. Threats to Canada’s critical infrastructure, including electricity, have begun to accelerate as well. Threat actors are becoming smarter and more numerous. And while new technologies and a more connected world offer a wealth of opportunities to make life better for every one, they offer new risks that security professionals must manage.

But, don’t just take my word for it. Canada’s National Cyber Threat Assessment identifies a growing threat to critical infrastructure, including electricity, from state and non-state actors. We’ve seen recent, highly public examples of this, including the Log4j vulner ability, risks from global conflicts, and the Colonial Pipeline attack. Risks will only grow as more distributed assets are added to the grid and as threat actors become more sophisticated.

Indeed, the Canadian Centre for Cyber Security assesses that operational technology (OT) digital transformations are “almost certainly providing cyber threat actors with new opportunities to access and disrupt OT systems”, and that cybercriminals are improving their skills. The North American Electric Reliability Corporation’s (NERC) 2021 ERO Reliability Risk Priorities Report explains that the “potential for increasing cyber attacks across all sectors has increased…for example, the 2020 SolarWinds and 2021 Colonial pipeline attacks accentuate supply chain vulnera bilities as well as threats from both foreign actors and domestic adversaries.” Technological advancements such as AI, offer new tools for cyber threat actors to use.

Meanwhile, physical threats to the grid continue – from copper theft, to pandemics, to more frequent extreme weather events.

Canada’s electricity companies work 24/7 to ensure reliable and secure power for homes and businesses, preparing for, and ready to respond to, a wide variety of threats.

Given the diversity and types of threats, the electricity sector’s security toolbox is quite large and contains:

• Exercises like GridEx, which brings together the electricity security community from Canada and the U.S. to practice response and recovery in the face of simulated, coordinated cyber and physical attacks on the North American electricity system, and other critical infrastructure

• Mandatory reliability and security standards from NERC as a baseline

• Threat intelligence sharing and mutual assistance programs

• Investments in the tools, technology, people, resources and processes to improve security postures, and

• Forums for security professionals across the sector to exchange information and work together to manage and address risks.

As communities look to more clean electricity to help solve climate change challenges and to power more of the economy, the imper ative for reliable and resilient electricity will only expand. Electricity companies are prepared to do their part in ensuring customers can depend on reliable and sustainable electricity – they already are. But no one company or sector or government authority can do this alone - critical infrastructure security is a shared responsibility. As threats speed up, deeper trusted partnerships in the critical infrastructure security community will be essential.

Government and regulators have an essential role to play here too – to accelerate investment in programs and activities that improve the security posture of Canadian critical infrastructure.

This means:

• Promoting and training a security workforce

• Deepening support for intelligence sharing and incident response programs between industry and government

• Ensuring that electricity companies can continue to invest in security

• Continuing investments in research, development and deployment of new technologies, programs or practices that make the grid more secure.

• Working with allies to create robust, secure, and resilient supply chains, and

• Continuing a commitment to participating in forums such as GridEx

Threats against the electricity sector are not slowing down, and we can’t always predict what will come next. With a continued com mitment from the electricity security community to ensure safe and reliable electricity to customers, and always asking what is next, we can work together to keep one step ahead.

Integrating Advanced SMRs and Renewables to Serve Customers with Low-Carbon Energy

When it comes to climate change action and energy production, we are told that in order to meet Canada’s carbon emission reduc tions objectives, we need to transition to more renewable sources of energy.

This holds true in New Brunswick - the transition must be done with reliable and low carbon-emitting sources of energy that can provide the capacity that NB Power needs in order to safely meet customer demand.

As part of its energy supply planning, NB Power reviews various generation supply options for the province of New Brunswick. In the context of emerging requirements to reduce greenhouse gas emissions, this includes consideration of all low-carbon energy sources, such as hydro, wind, solar and nuclear. At the same time, NB Power is looking at energy storage options as a tool to integrate more renewables on the grid.

While all low-carbon sources are important contributors to achiev ing net zero energy supply, they each play different roles in NB Power’s electricity system.

To ensure that New Brunswickers can count on electricity being available when they need it, NB Power must effectively balance supply with demand. Energy and capacity are both needed to continuously meet customer demand safely and reliably. While some renewable energy sources, such as wind and solar, are good sources of electrical energy, they do have limited generation capacity. They can only provide electricity when the wind is blow ing or when the sun is shining, so they cannot always be relied upon when customers need it.

As a result, in order to provide a constant amount of electricity to the grid, wind and solar must be paired with a firm and dependable low carbon-emitting energy source that is available when required,

such as a Small Modular Reactor (SMR). SMRs will provide a con stant amount of electricity to the grid, and have the ability to ramp up and down quickly to take advantage of renewables when they are available and enhance reliability of flowing power.

In New Brunswick, the current largest sources of safe, reliable, on-command and carbon-free electrical capacity and energy comes from Point Lepreau Nuclear Generating Station and NB Power’s hydroelectric fleet. Together, these stations provide New Brunswickers with roughly half of their electrical energy and capacity needs. With limited additional hydroelectric generation potential, additional nuclear is the only carbon-free electrical capacity development option.

New Brunswick is currently 80 per cent carbon free. For NB Power to continue to deliver safe, reliable, sustainable and cost-effective electricity to its customers as it continues to lower its emissions, the organization is looking at the integration of all non-emitting and carbon-free generation. This includes advanced SMRs, which can help reduce carbon emissions further by replacing conventional carbon-emitting energy sources like coal and gas on the New Brunswick grid.

Advanced SMRs provide NB Power an opportunity to expand its sources of electrical capacity and energy to meet the growing needs of New Brunswickers for electricity, through the electri fication of transportation and further electrification of industrial processes. They also produce a high-quality steam which allows for potential future partnerships with industrial applications.

“New Brunswick has the potential to become a centre of excel lence for the development of the advanced SMR technology as NB Power strives to be Net Zero by 2035,” comments Brett Plummer, NB Power’s Vice President Nuclear and Chief Nuclear Officer, “It would create even more benefits for the province, including approximately 730 jobs per year over 15 years, $1 billion in GDP and $120 million in provincial government revenue.”

As there are many changes in the energy sector, and pressures related to climate change and reducing our carbon footprint, NB Power is showing leadership and innovation in finding new sources of energy for New Brunswick’s future needs. Generating 400 megawatts through advanced SMRs could reduce cumulative greenhouse gas emissions in the province by 15-20 megatons over a 10-year period from 2031 to 2040, presenting a tremen dous opportunity that will move New Brunswick one step closer to reaching Net Zero carbon emissions.

Hydrogen

Matthew Klippenstein

Regional

The Lobster Claw of Emissions Reductions

The path to Net Zero is something of a lobster claw. The bulk of emissions reductions will be done with direct electrification, the large portion of the claw. Hydrogen in various forms from various sources is the “thumb”.

Clean hydrogen is central to Canada’s Net Zero pledges and our energy future. The Hydrogen Strategy for Canada estimates hydrogen could represent 30% of end-use energy by 2050, with

the Roadmap to a US Hydrogen Economy estimating up to 14% in the United States. Worldwide, BloombergNEF researchers believe hydrogen could provide up to 24% of end use energy, higher than the Hydrogen Council’s own 18% figure 1

However large the eventual number, hydrogen can be a way for Electricity Canada members to expand from the electron (elec tricity) business into the proton business (hydrogen). The proton business may never be as large, but it remains a valuable comple ment to Canada’s energy mix.

Up-valuing Electrons

Hydrogen may also be a way to up-value electrons whose whole sale clearing prices have edged downwards as more variable solar and intermittent wind enter the Western Electricity Coordinating Council (WECC), Midwest Reliability Organization (MRO) and Northeast Power Coordinating Council (NPCC).

Alberta’s Transition Accelerator 2 noted that in cheaper regions, Canadian grid customers can generate hydrogen for the same cost-per-GJ as the wholesale price for transportation fuels such as gasoline and diesel. Hydrogen fuel cell systems are also more efficient than combustion drivetrains, creating a cost-per-km advantage. But hydrogen distribution and dispensing costs remain considerably higher.

If Electricity Canada’s members can generate hydrogen competi tively, even when paying transmission and distribution costs, some members may be able to generate hydrogen on-site at even more competitive rates.

Adding to the business case for hydrogen, the Government of Can ada’s soon to be announced Low Carbon Fuel Regulation should enable a market in which producers of low emissions hydrogen can claim carbon credits. Based on the reference data laid out in British Columbia’s Low Carbon Fuel Regulation, that province’s regulatory credits (recently trading above CAD$450/tonne CO2) implied a credit value of more than CAD $6/kg for hydrogen generated using electricity from the province’s grid, when replacing diesel. (It must be emphasized that past prices may not be indicative of future performance.)

Wind, Solar, Hydrogen

If we chart annual wind turbine production in the wind industry’s infancy (the 1990s) and overlay annual production of solar pho tovoltaics during their early years (the 2000s) a remarkable thing happens. On a logarithmic scale, the two growth trajectories broadly superimpose.

Recent production totals for the fuel cell industry, whose renais sance Canada’s Geoffrey Ballard sparked forty years ago, follow much the same trend.

Hydrogen electrolyzers are poised to scale up much faster.

Hydrogen electrolyzers’ rapid scale-up will “pancake” capital expenditure costs, which should make it easier for electric utilities to up-value their electrons by adding a complementary proton busi ness. As Electricity Canada members become interested in these new opportunities, the Canadian Hydrogen and Fuel Cell Associa tion can provide guidance on their hydrogen journey.

1 BNEF Hydrogen Economy Outlook, March 2020. Hydrogen Council, Scaling Up (2017).

2 Transition Accelerator, Towards Net Zero Energy Systems in Canada (2020).

Electricity Fundamentals in Canada

– Accelerating Learning

Electricity Canada’s new strategic plan through to 2025 includes strategic goals that direct the organi zation to Think, Advocate, Communicate and Educate on behalf of our members. With the education goal in mind, a new foundational course, intitled Electricity Fundamentals in Canada (EFiC), was developed

President and CEO Francis Bradley states that “with a focus on education, Electricity Canada is uniquely positioned to offer a foundational course that pro vides the fundamentals for those who work in or are interested in the energy sector.

Our industry is experiencing rapid growth with the influx of renewables, change in consumer behaviours and rapidly evolving emissions targets from the Government.

This specially designed course, while energy agnostic, will ensure Canadians understand the importance of the electricity sector on the path to a Net Zero future.”

While not designed to replace formal education, other training courses tend to be narrowly focused, in depth, technical and expensive. Beginner courses are generally not as extensive as required and often come with a heavier price tag.

Electricity Fundamentals in Canada (EFiC) is a unique post-secondary level course that provides a high level overview of the entire industry, ranging from nomenclature, technologies, issues, chal lenges, and the future.

The content will range from a discussion of atoms and electrons, kWh’s, kW’s, etc. through genera tion, renewables, transmission, distribution, power marketers, the customer, conservation, beyond the meter, how utilities are paid, the regulatory structure in Canada, how electrons flow across North America, the role of Electricity Canada, NERC, FERC, and much more.

This online, self-paced course is available in English and French. Following the completion of several modules, students will be able to obtain their EFiC Certificate of Completion.

Prepared in layman’s terms and with no prerequisite study required, EFiC provides all of the tools neces sary to provide a comprehensive overview of how the electricity system in Canada works.

Electricity Canada has developed EFiC with support from an outside professional E-learning organization and will be updated regularly and supported continuously.

An EFiC Advisory Panel has provided guidance throughout course development. This course will be a foundational data resource for Electricity Canada’s other Knowledge Centre content.

Who EFiC is for:

• Everyone who works in the electricity industry in Canada – including utility and service provider executives, management and staff; employees of associated Canadian Federal Government departments; Provincial, and Municipal Governments; Provincial regulators; Indigenous communities; all vendors & suppliers to the industry; electricians; educational institutions, and those with a general interest in the sector. EFiC will be of interest to all, whether new to the industry, transitioning from other industries, or simply looking for a refresher!

EFiC Includes:

• Over 65 hours of learning

• 5 hours of self-paced core content

• Over 60 additional hours of content through several “To Learn More” links to associated videos, websites, articles, and podcasts providing opportunities for further education as desired

• 9 Modules covering 165 topics in a fun, interactive and informative format under the following headings:

• Introduction to Electricity Fundamentals

• Generation - Where it All Starts

• Transmission - The Long Haul

• Distribution – Delivering to and Serving the Customer

• The Meter and Beyond

• The Customer

• Industry Focus Areas

• The Industry

• The Future

• 18 knowledge checks throughout

• Key takeaways, testing and scoring within each module

• 139-page downloadable EFiC Student Manual/Handbook for future reference

• Downloadable Glossary of Terms

• Certificate of completion

Registration for EFiC:

Registration will be open in May 2022. The cost is $200 plus applicable taxes per student with volume discounts available.

EFiC log-on credentials will be available to regis trants for up to one year from date of purchase.

For more information on registration, please contact Sylvia Spears at spears@electricity.ca

Electricity Canada thanks the following contributors:

• Advisory Panel - Representatives from Alectra Utilities, ATCO, Hydro Quebec, Maritime Electric, SaskPower, Rio Tinto

• Founding Sponsors - Domino Highvoltage, Tantalus

• Founding Electricity Canada Members –Alectra Utilities, ATCO, City of Medicine Hat, Fortis Alberta, Fortis BC, Fortis Inc., Heartland Generation, Manitoba Hydro, Maritime Electric, Newfoundland and Labrador Hydro, NB Power, Rio Tinto, Saint John Energy, Saskatoon Light & Power, SaskPower, Toronto Hydro

• Founding Electricity Canada Corporate Partners – ComplyTech, Domino Highvoltage, Hexagon Safety and Infrastructure, KPMG, MNP, RS Technologies Inc. , Tantalus

Accelerate Net Zero

State of the Canadian Electricity Industry 2022

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