Publications

Energy & ClimateScience, Technology, & Innovation

Energy & Climate

June, 2018
Ontario’s Long-Term Energy Plan (LTEP) places significant reliance upon Distributed Energy Resources (DER) consisting of renewables and storage to address an emerging gap in the province’s electricity supply mix. This report examines the economics of meeting this supply gap with renewables-based (solar and wind) DER and how the intermittent output of these variable generation sources interact with storage to undermine those economics.
Key subjects: DER, Renewables, Nuclear, SMR, natural gas, CCS
August, 2017
In 2016, Ontario and Quebec entered into an electricity trade agreement with the goal of expanded interprovincial trade and collaboration and to generate savings for ratepayers. However, when the specifics of this agreement are examined, it becomes clear that the energy portion of this deal will increase costs to Ontarians. Ontario consumers will pay a premium over market prices when, alternatively, the province’s electricity market and carbon pricing scheme, if left alone, would achieve the same results at a lower cost.
Key subjects: interprovincial electricity trade, transmission, distribution, government transparency, electricity rates
June, 2016
This study examines the implications associated with expanding electricity transmission intertie capacity between Ontario and Quebec by assessing four themes with posited benefits: 1) addressing peak reserve capacity, 2) smoothing intermittent supply, 3) balancing supply and demand economically, and 4) provision of firm imports.
Key subjects: interprovincial electricity trade, transmission, distribution, firm imports, interties, peak reserve, hydroelectric generation, natural gas-fired generation
Ontario’s Emissions and the Long-Term Energy Plan
November, 2016
This study was commissioned to inform Ontario’s 2017 LTEP consultation with research and analysis relating to emission reduction targets, the costs of emission reducing technologies, supply mix choices, and the carbon price within Ontario’s cap and trade program.
Phase 1, “Defining the Challenge”, quantifies the costs of Ontario’s climate actions and identifies the factors that the LTEP consultation process must address. This report documents emission targets for each sector, identifies 45 emission reduction options posited by Ontario stakeholders, estimates the costs of each, and summarizes the aggregated cost to Ontarians and the implications for market carbon pricing, cap and trade program, CCAP implementation, and the LTEP.
Major outcomes include:
  • ~90 TWh of new generation is required to meet the 2030 emission reduction targets, 80% more energy than the ~50 TWh provided for in the Ontario Planning Outlook D scenario.
  • An LTEP process focused on the province’s climate change objectives is critical to lowering costs and meeting emission targets
  • The LTEP should seek the lowest cost emission-free energy solutions that reflect the integrated costs of generation, transmission, and distribution.
Key subjects: interprovincial electricity trade, transmission, distribution, firm imports, interties, peak reserve, hydroelectric generation, natural gas-fired generation
December, 2016
The Phase 2 report investigates the cost and economic implications of Ontario’s electricity supply mix options used for the 2017 LTEP. The analysis looks at the implications on supply arising from the new electricity demand, assesses the costs and implementation considerations of the supply mix options put forward in the OPO as well as alternatives, and describes the cost, schedule achievability, and economic implications to Ontarians associated with those choices.
The report presents a new supply mix option developed to meet three key objectives:
  1. Reduce the estimated annual cost of meeting Ontario’s 2030 emission reduction targets;
  2. Support the timely achievement of Ontario’s emission targets and minimize the need to purchase emission credit allowances from other jurisdictions; and,
  3. Ensure Ontario’s competitive advantage through strategic investments in “made-in-Ontario” solutions that achieve the province’s emission reduction targets and yield the highest payback for Ontarians.
Key subjects: Electricity supply mix, DER, RNG, hydrogen, nuclear, cap & trade, emissions, building heating, residential demand
December, 2015
The Ontario Ministry of the Environment and Climate Change (MOECC) issued a consultation request on the design options of their proposed cap and trade regime in Ontario that would be linked to that of California, and Quebec. The MOECC says that cap and trade will be the primary tool for achieving Ontario’s 2020 greenhouse gas emission reduction target and is seeking input to assist with preparation of a draft regulatory proposal. This report has been prepared in response to that request for input and initiates a discourse on several design features which aim to maximize the likelihood of an implementation program that best serves the interests of Ontarians.
Key subjects: Carbon pricing, emission trading, carbon allowances, border carbon adjustments, climate policy, WCI
November, 2015
This report examines the option of extending the operations of two Pickering A units for two years and four Pickering B units for four years to address two challenges: 1) expected doubling in Ontario’s GHG emissions, and 2) a system reserve capacity gap. The extensions would defer the need to construct 2,000 MW of new natural gas-fired generation plants that are otherwise necessary in 2021.
Key subjects: Electricity system cost, GHG emissions, nuclear, PNGS, reliability reserve capacity, jobs, GDP
June, 2013
Ontario’s 2010 LTEP intended to ensure a dependable future electricity system characterized by low greenhouse gas energy sources while encouraging job growth in the clean energy sector. In April 2013, the Minister of Energy announced that the Ontario government would conduct a review of the LTEP to be completed within six months. While several reports and studies have looked at different supply/demand scenarios for Ontario, none have assessed the economic and greenhouse gas impacts associated with supply mix options and the potential consequences for Ontarians. This report illustrates two supply mix scenarios and compares them on the basis of total energy costs, electricity rates, economic impacts of investments to bring the alternative scenarios online, and greenhouse gas emissions.
Key subjects: electricity demand, LTEP, electricity supply mix, emissions, nuclear, wind, Ontario, economy, cost forecast, jobs
January, 2013
This paper presents the results of an analysis of available public sources with the purpose of creating an evidence-based forecast of the costs that will arise if the Ministry of Energy’s LTEP is fully implemented for the next five years. The objective of this paper is to take a pulse on the emerging cost of this plan and compare it to the cost growth assumptions contained in the LTEP.
Key subjects: annual cost, electricity system, residential cost, industrial rates

Science, Technology, & Innovation

Fall, 2014
Strategic Policy Economics was the lead researcher for this KPMG report. In 2013, KPMG LLP (KPMG), in its role as Nuclear Advisors to Natural Resources Canada (NRCan), initiated a study on Canada’s Nuclear Science and Technology (S&T) capabilities and how they contribute to Canada’s economy, job market and broader innovation system and thus provide a Return on Investment (ROI) to the federal government. This study is intended to provide input to the government’s work on exploring nuclear innovation. The study considers historical data and information regarding the Canadian Nuclear S&T ecosystem and how Canada’s Nuclear S&T capability has been leveraged, both within and beyond the Nuclear Energy sector.
Key subjects: Innovation, research, nuclear science and technology, government investment, GDP, jobs
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