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Home » Energy Market Update: October 2023

Energy Market Update: October 2023


Renewable energy windfall should benefit Alberta consumers, industry: NDP

A renewable energy windfall of nearly $300 million for the Alberta government should be used to expand the industry and help low-income people pay power bills, say the provincial New Democrats. Economics professor Blake Shaffer and co-authors have updated the total payments that renewable power producers have been making to the province under contracts signed during the previous New Democrat government. Those contracts, made under the Renewable Energy Program, contain what Shaffer called a “two-sided” clause. Companies first bid for the price at which they will sell electricity, the lowest price winning the auction. They are then guaranteed whatever price they bid. If the market price drops below the auction price, government pays the difference. If it rises above, companies pay the government. The contracts were signed between 2015 and 2017.

Companies were then willing to bid between $30 and $43 a megawatt-hour, far lower than expected and a reflection of how cheap renewables have become to install. Market prices for power have since more than quadrupled. The difference has gone to the government. But the companies also agreed to relinquish rights to any carbon credits they would generate by replacing fossil fuel-generated power. At about $20 a megawatt-hour, Shaffer figures savings from those unissued credits bring the total gain for provincial coffers to $282 million. Shaffer cautions that the windfall won’t last forever. Power prices are expected to fall, reducing the government’s take. Source: National Observer

Electricity Prices for Alberta

The Alberta power pool price averaged 9.934 cents per kWh in October 2023. This price is 1.240 cents lower than last month’s average of 11.174 cents. The pool price has averaged 16.295 cents per kWh over the last 12 months.

As of November 1, 2023, the forward market was predicting electricity prices for the calendar years of 2023, 2024, 2025, 2026, 2027, and 2028. These prices are 14.025, 8.740, 6.831, 6.875, 6.875, and 6.875 cents per kWh respectively.

Gas Prices for Alberta

Direct Energy’s gas rate for October 2023 was $2.522 per GJ in Alberta. The November 2023 rate has been set at $2.486 per GJ. Alberta gas prices have averaged $3.345 per GJ over the last 12 months.

As of November 1, 2023, the forward market was predicting gas prices for the calendar years of 2023, 2024, 2025, 2026, and 2027. These prices are 2.65, 2.77, 3.73, 3.88, and 3.79 cents per GJ respectively.


British Columbia

‘Elegant’ low-carbon energy projects planned by northern B.C. First Nation: David Eby

A northern B.C. First Nation has signed an agreement with the province to work together on what Premier David Eby calls an “elegant” proposal for a clean energy hub on band territory north of Prince George. McLeod Lake Indian Band Chief Harley Chingee says signing a memorandum of understanding for the Tse’khene energy transition hub gives him certainty to move forward “in a good way” on the project that relies on existing pipelines in the region, including Coastal GasLink. The pact, also signed with the B.C. Energy Regulator, formerly the B.C. Oil and Gas Commission, sets up a framework to create low-carbon energy through several Indigenous owned and operated projects, starting with a hydrogen production facility. A second project would develop a so-called straddle plant capable of skimming high-value liquids such as ethylene from natural gas in the four pipelines already running across McLeod Lake traditional lands. Collectively, the projects are worth about $7 billion and could create as many as 2,000 construction jobs and 500 permanent, full-time jobs. Employment would be open to all B.C. residents, not just members of the McLeod Lake band, Chingee said. Source: Vancouver Sun



Ontario power producer plans to increase Toronto gas plant output, but critics worry about impact

An Ontario power producer outlined plans to increase output at a gas plant in Toronto, but critics say the proposed upgrades aren’t needed and energy should be focused on greener alternatives instead. Atura Power, a subsidiary of Ontario Power Generation, operates the Portlands Energy Centre (PEC), a 550-megawatt natural gas electrical generating station near Toronto’s waterfront. Atura Power officials said that upgrades to the plant would result in a 50-megawatt increase in its electrical output. Officials said the upgrades would not increase the plant’s greenhouse gas emissions. The plant is on the list of the province’s largest industrial emitters with 618,211 tonnes of emissions released in 2021. While it’s investing in nuclear energy, the province has signalled its reluctance to nix natural gas energy just yet, citing it as an “insurance policy” to keep the lights on. Source:  CBC



Moe says Saskatchewan to stop collecting carbon tax on heating if no federal break given

Premier Scott Moe says Saskatchewan is to stop collecting the carbon tax on natural gas if Ottawa doesn’t offer a break, a move that has received unanimous support in the provincial legislature. Moe said Monday that starting Jan. 1, the provincial gas utility SaskEnergy won’t collect or submit the tax to the federal government unless Ottawa provides the province an exemption. Prime Minister Justin Trudeau announced last week the carbon tax would be exempt for three years on home heating oil to address affordability needs. The move largely helps those in Atlantic provinces, where it’s a main source for home heating. Saskatchewan’s Opposition NDP said it supports Moe’s move.

NDP member Jared Clarke introduced a motion expressing concern over the exemption not applying to Saskatchewan. The motion also expressed displeasure with comments from Gudie Hutchings, the federal rural economic development minister, who told CTV last week that people in Western and Prairie provinces should elect more Liberals if they want to have conversations around potential exemptions. A Saskatchewan Party member amended the motion to say the assembly supports not collecting or remitting carbon tax from natural gas if the “Liberal-NDP coalition” doesn’t offer an exemption. The motion passed unanimously, 52-0. Source: CBC



Kinew tells cabinet to try to make Manitoba Hydro 100% green by 2035, province emissions-free by 2050

Manitoba Premier Wab Kinew has asked his cabinet to try to wean Manitoba Hydro off its last gas-fired power plant by 2035 and to create a plan to make the province entirely carbon-neutral by 2050. In a mandate letter handed to Environment and Climate Change Minister Tracy Schmidt on Oct. 19 Kinew says he wants his NDP cabinet to “work toward making our energy grid net-zero by 2035” and to “create a roadmap to meet net-zero targets by 2050.” The directive marks a departure from the previous Progressive Conservative government, whose energy roadmap, published in July, stated it was not feasible to wean Hydro off its last fossil fuel-burning electricity plant in the immediate future. Right now, 97 per cent of Manitoba Hydro’s energy production comes from hydroelectric power and other low-carbon sources. A natural gas-fuelled station in Brandon is responsible for the remaining three per cent of energy production. By using terms such as “work toward” and “roadmap” rather than more definitive language, the mandate letter does not require cabinet to ensure Manitoba meets the new goals. Source: CBC


New Brunswick

N.B. to spend more on heat pump program, but will fall short of clearing waitlist

New Brunswick announced that it will spend another $30 million on the enhanced energy savings program, but the additional funds won’t be enough to clear the existing waiting list for the program. The additional funds are on top of the $70 million already earmarked for the program over the last two years, which provides efficiency audits and free mini-split heat pumps and insulation upgrades for households making under $70,000 per year. According to NB Power CEO Lori Clark, it would require about $150 million to clear the existing waiting list of about 16,000 people. That means another $120 million would be needed to clear the current waitlist. Each home costs about $10,000 for an electric baseboard conversion and about $30,000 for an oil heat conversion. The budget for this year before the additional money was announced was $21.8 million and $37.4 million, respectively.

Despite challenges in the initial rollout and the size of the waiting list, Clark said the benefits of the program are clear. “We are seeing about a $460 annual savings. That’s the average annual savings for those that have had the benefit of the program and one of the biggest parts is the insulation,” she said. Source: Global News


Prince Edward Island

Georgetown chosen to be shaped into P.E.I.’s 1st net-zero community

The P.E.I. government says it plans to make Georgetown the province’s first net-zero community. The community will be home to the Georgetown Clean Tech Park, a 25-hectare business hub launched in February 2022 that the province hopes will attract green companies and entrepreneurs. The park will also house the Clean Tech Academy, which will offer a certificate and a master’s degree through a joint initiative of Holland College and the University of Prince Edward Island. The province is collaborating with UPEI’s Canadian Centre for Climate Change and Adaptation and Faculty of Sustainable Design Engineering on the project. Residents may be asked to take part in surveys, as drones collect the required data to map out the neighbourhood. Meanwhile, researchers will be collecting all sorts of data including Maritime Electric bills to determine power usage. The province aims for Georgetown to become fully net-zero by 2027. The Island’s overall goal is to transition to full net-zero by 2040. Source: CBC



Hitachi Energy deploys electric bus charging system for Quebec’s RTC

Hitachi Energy reports it has successfully deployed a centralized, multi-vehicle electric bus charging solution—the Grid-eMotion Fleet EV charging system—for Réseau de transport de la Capitale (RTC), the public transit agency in the Quebec City area. The technology was selected for a three-year pilot project that may ultimately leads to the electrification of RTC’s entire bus fleet and infrastructure. One of the key goals of the pilot project is to explore different fleet charging strategies in an active bus terminal, including traditional plugs, as well as overhead pantograph systems. Hitachi Energy’s solution has been tested at RTC’s Metrobus Centre and is expected to run at full capacity in 2024. Source: Electrical Business


Newfoundland and Labrador

Decision expected on World Energy GH2 wind energy proposal

Newfoundland and Labrador Environment Minister Bernard Davis is expected to release a decision on the environmental assessment of an ambitious wind farm and proposed hydrogen energy plant. The World Energy GH2 project.proposal — advanced by billionaire John Risley — would put at least 328 wind turbines on the Port au Port Peninsula and in the Codroy Valley, and a hydrogen-ammonia plant in western Newfoundland. In August, the province announced four companies — including World Energy GH2 — were advancing to the next stage of wind hydrogen project development. World Energy GH2 expects to be producing hydrogen by the end of 2025 and ammonia in the first months of 2026 through its plant in Stephenville. Ammonia is created through a process that turns wind energy into hydrogen, which is converted to ammonia and shipped to ports around the world. According to the impact statement, the project would also purchase 600 to 650 gigawatt-hours of power from Newfoundland and Labrador Hydro each year. Source: CBC


Nova Scotia

Amendments Will Bring More Renewable Energy, Storage to the Grid

Amendments to the Electricity Act introduced October 13, will help add more renewable energy to the grid and clear a path for energy storage solutions. Changes will allow the government to quickly approve innovative energy storage projects that Nova Scotia Power aims to build and take advantage of committed federal funding to reduce the cost for ratepayers. This will help advance the use of batteries for storing excess renewable energy for use during peak demand hours, which reduces renewable energy waste and makes the grid more stable. Changes will also add clarity for parties entering “sleeved” power purchase agreements. These agreements let a large-scale electricity customer buy renewable electricity from a producer at a set price. The sale and delivery are managed through Nova Scotia Power. Changes will make it clear that the minister has the authority to direct Nova Scotia Power to enter into these types of agreements. Source: Nova Scotia



One wind project could inspire a carbon-free future for the North

The territory of Nunavut relies on fossil fuels for power generation, imported from many kilometres away to heat homes and keep lights on. That will soon change in one community, where a wind project is moving forward after years of planning. Sanikiluaq is an Inuit community on the Belcher Islands in Hudson Bay. An energy purchase agreement signed between Nunavut’s Crown electrical utility and Nunavut Nukkiksautiit Corporation (NNC), an Inuit-owned renewable energy developer, will build a 1 MW wind turbine and a 1 MWh battery storage system. The goal is to cut diesel use in the 1,000-resident hamlet in half. Because Nunavut isn’t connected to a power grid, diesel is shipped in during the summer months to prepare communities for a long winter. The fossil fuel is polluting, expensive and forces people living in the territory to rely on a source of energy over which they have little control. The reliance on diesel stretches beyond Nunavut: off-grid communities in Labrador, the Northwest Territories, Yukon and Nunavik (homeland of the Inuit of Quebec) overwhelmingly depend on diesel. Part of the revenue from the project, which will sell energy back to the utility, will be shared with Sanikiluarmiut (people who live in Sanikiluaq) through a community enhancement fund. The project agreement, which will run for 25 years once in operation, includes measures to make sure electricity prices do not rise for residents. Source: Penticton Herald


Northwest Territories

The feds say switch to heat pumps. Will that work in the NWT?

Whether or not the territory feels the benefit, the federal initiative is clear: get people off heating oil and move them to heat pumps. There’s even a program worth thousands of dollars per family designed to “make the average heat pump free for lower-income households.” The federal government has said it wants households to use the three-year pause to make the switch. Heat pumps have been called “reverse refrigerators.” Your fridge uses a refrigerant to transfer heat outside and keep the food cold, but a heat pump uses a refrigerant to transfer heat inside and keep you warm (or heat your water). They are powered by electricity and are seen as a far cleaner solution, environmentally, than oil or the like. The Arctic Energy Alliance, which administers territorial and federal rebate programs for energy-efficient solutions in the NWT, has been studying heat pumps for the past year.

So far, said Arctic Energy Alliance boss Mark Heyck, there are two problems: the first is the cold, and the second is the cost of electricity. “Heat pumps lose efficiency the colder it gets. You reach your sweet spot around -15C or -20C. They’re fairly efficient up to that point. Anything colder and they lose their efficiency,” Heyck told Cabin Radio. Meanwhile, the cost of electricity in the NWT is generally around four times the price in the south. If you switch to a heat pump in the North, you’re having to pay far more to run it than a southern counterpart would. Nor is the territory currently producing enough electricity for a mass migration to heat pumps to work. In the meantime, Heyck says residents who heard the federal call to leave heating oil for heat pumps might be better off picking biomass – wood or pellet stoves. Source: Cabin Radio



Haeckel Hill wind turbine project reaches milestone towards a strong, sustainable Yukon

The Haeckel Hill Wind Farm Project will power up to 650 Yukon homes per year with clean electricity. The wind turbines are expected to produce enough clean energy to remove the equivalent of more than 40 million litres of diesel fuel, which offsets up to 115,000 tonnes of greenhouse gas emissions from the Yukon. The total cost to complete the project was $29.8 million. The Government of Canada has invested over $13 million through the Arctic Energy Fund of the Investing in Canada Infrastructure Program; nearly $5 million through the Canadian Northern Economic Development Agency (CanNor); and nearly $10 million through Clean Energy for Rural and Remote Communities Program (CERRC).

The Eagle Hill Energy Limited Partnership (fully owned by Kwanlin Dün First Nation’s development corporation Chu Níikwän LP) has invested more than $2 million worth of in-kind work. The Haeckel Hill Wind Farm Project was developed by Eagle Hill Energy LP, a wholly owned subsidiary of Chu Níikwän LP, the development corporation of the Kwanlin Dün First Nation. It is the first 100 per cent Indigenous-owned wind energy project in northern Canada. The project uses innovative cold-climate wind-turbine technology to boost winter production. This will expand the Yukon’s role in cold-climate renewable energy research and resiliency.  Source: Electric Energy Online