Making Sense of Energy

Energy Market Update: June 2015

alberta  Alberta

Canadian producers continue to drill for and produce diluent for bitumen transportation. Diluent is a mix of petrochemicals used to facilitate the transportation of bitumen. Currently gas prices continue to stay low and the market continues to be oversupplied. As a result, Canadian producers are experiencing hardships due to low price levels and strong competition from the United States. Nevertheless, production is expected to remain flat through to 2017 with the possibility of rising pending price increases. The National Energy Board expects to see less drilling and more production per well.  (Source:  Edmonton Journal)

Electricity Prices for Alberta

The Alberta power pool price averaged 9.731 cents per kWh in June 2015. This price is 4.338 cents higher than last month’s average of 5.393 cents per kWh. The pool price has averaged 4.521 cents per kWh over the last 12 months.

As of June 5th, 2015, the forward market was predicting electricity prices for the calendar years of 2015, 2016, 2017, 2018 and 2019. These prices are 5.400, 4.400, 4.650, 4.850 and 5.325 cents per kWh respectively.

Gas Prices for Alberta

Direct Energy’s gas rate for June was $3.471 per GJ in the North and $3.741 per GJ in the South. The July rate has been set at $1.822 per GJ in the North and $2.133 per GJ in the South. Alberta gas prices have averaged $3.480 per GJ over the last 12 months.

As of June 5, 2015, the forward market was predicting gas prices for the calendar years of 2015, 2016, 2017, 2018 and 2019. These prices are 2.64, 2.93, 3.20, 3.37 and 3.58 cents per GJ respectively.

bc  British Columbia

The Canadian International Trade Tribunal issued a decision against the dumping of Chinese solar panels into Canada, claiming that this action could be detrimental to the Canadian solar industry. The ruling implies that from now on, tariffs will begin to apply to Chinese companies by the Canada Border Service although final tariff rates are yet to be announced. Although most of the Canadian solar industry is content with the ruling, a small number is concerned about solar product price hikes and depressed demand.  (Source:  Globe & Mail)

ontario  Ontario

Queen’s Park has downsized its Samsung renewable energy deal by $2 billion, down from $7 billion to $5 billion. The high cost high risk strategy that blended energy diversification with industrial incubation in 2010 appears to be fading due to a slowing down of industrial demand and increase in electricity prices. This has increased resistance and risk averse behavior. Another factor that has undermined this project has been the low-cost competition from Chinese solar panels both domestically and internationally.  (Source:  Toronto Star)

Electricity Prices for Ontario

The weighted-average Hourly Ontario Energy Price (HOEP) was 1.531 cents per kWh in June 2015. This price is cents 0.005 cents lower than last month’s 1.536 cents per kWh. The weighted-average price has averaged 2.168 cents per kWh for the past 12 months.

The Global Adjustment Class B 1st Estimate rate for June was set at 9.228 cents per kWh. This rate was 0.188 lower than last month’s global adjustment of 9.416 cents per kWh. The Global Adjustment is an additional charge paid by non-regulated customers. (Source: IESO)

sask  Saskatchewan

A SaskPower carbon capture test facility lab was recently launched, offering unique opportunities to scientists and researchers from all over the world. The launch was attended by representatives of the Carbon Sequestration Leadership Forum. SaskPower hopes that this lab will continue to bring international interest to Saskatchewan as well as bring innovation to Carbon Capturing.   (Source:  Sask Power)

manitoba  Manitoba

The Lorette Lagoon Expansion project was announced on June 29th and is expected to be completed by 2016. The expansion of the lagoon and nutrient removal project will consist of the construction of a new aerated primary cell which will be connected to the two existing aerated primary cells. As well, a new secondary cell will also be constructed. This technology leads to additional wastewater treatment capacity. Funding will be provided by the Government of Canada, Province of Manitoba, and the Rural Municipality of Taché. Each level contributing $800,000.  (Source:  Manitoba Government)

NB  New Brunswick

The province of New Brunswick has launched a home insulation energy savings program through New Brunswick Power (NB Power) to reduce energy and lower costs for consumers. The program provides advice and targeted financial incentives for insulation and air-sealing upgrades. NB Power’s Saint John office is in charge of administering the program. Home-owners have nine months to complete the upgrades before they’re eligible to apply for an evaluation which will determine the financial incentive amount and provide an estimate of savings based on energy reduction.  (Source:  New Brunswick Government)

PEI  Prince Edward Island

Maritime Electric vice-president Angus Orford announced that a five-year strategy has been filed with the Island Regulatory and Appeals Commission. The project, named the Maritime Electric is set to cost $10 million. The plan calls for reducing energy demand by reducing the peak load on the power grid.  (Source:  CBC News)

Quebec  Québec

Testing for the first large-capacity energy storage prototype was announced beginning during the summer of 2015. These tests will consist of the analysis of the storage system performance during charging and energy injection onto the grid. The large-scale energy storage system will meet electricity demand during peak consumption periods and facilitate the integration of renewable energy onto the grid.  (Source:  Hydro Quebec)

NFL  Newfoundland and Labrador

Oil production has in the South White Rose oil field in the Jeanne d’Arc Basin off Newfoundland’s Grand Banks. Husky energy announced that the first well has been brought online and the second well expected to begin production in late summer, at which time net peak production is expected to ramp up to about 15,000 barrels per day. Husky Energy anticipates production to offset any impact of natural declines in the region.  (Source:  CBC News)

Nova Scotia  Nova Scotia

A strike that began last month putting over 300 unionized employees of Halifax Water off the job is still in the process of negotiations. Although both parties are optimistic that a deal will be reached, neither side is able to offer more details due to an ongoing media blackout.  (Source:  CBC News)

Nunavut  Nunavut

Iqaluit’s sewage treatment system is expected to need major repairs, however, it appears that the city cannot afford the $26.5 million bill. After researching and studying for a solution, the engineering and consulting firm Stantec came to the conclusion that the best alternative is to expand and upgrade the current infrastructure. However, the city is over $10 million short in its budget to pursue this option. The Deputy Mayor said that if they can get an extension to fix the system, they can use the next block funding from the Government of Nunavut to pay for the upgrades.  (Source:  Nunatsiaq Online)

nwt  Northwest Territories

Northwest Territories Power Corporation applied to lower the rate it charges Northland Utilities in Yellowknife from 19.21 to 18.71 cents per kilowatt hour. This is one of a number of changes for which the power corporation has applied to the Public Utilities board. According to the power corporation, all communities will benefit from a lowered power rate since the subsidized rates used are based on Yellowknife’s rate. As a method to make up for reducing consumer costs the company would like to increase the electricity price of its sole industrial client, the federal government’s Giant Mine remediation site.  (Source:  CBC News)

Yukon  Yukon

Northern residents are being hit harder than the rest of the country with regards to the rise in gas prices. Prices rose 20 cents in Yellowknife while only rising 10 cents in the rest of the country. According to a petroleum analyst from explained that the sudden jump is tied to refineries in the upper Midwestern United States, which have in recent weeks struggled to get product to market.  (Source:  CBC News)