Today the situation in the UK is much different. North Sea reserves of natgas are down and gas prices are very much up. In 2010 the UK grid was made up of 34,000 MW of gas (Ontario in 2013, 10,000 MW), 29,000 MW of coal (Ontario 3,300 MW), 11,000 MW of nuclear (Ontario 13,000 MW), 4,200 MW of hydro (Ontario 8,000 MW) and 4,200 nameplate MW of wind (Ontario 2,000 MW on transmission grid). Imported gas will account for 75 percent of all gas consumed in UK by 2015, it was 50 percent in 2009. The government has set a limit on carbon emissions from fossil plants that ensures that only gas-fired units get built in the future, unless carbon capture and storage (CCS) becomes practical for coal-fired plants – unlikely. All operating nuclear units in the UK, except for Sizewell B, will be retired by 2023 and coal-fired stations that do not meet the European Union pollution directive, by 2015. All this is likely to lead to electricity shortages in the next few years unless something is done. The government’s plan is to proceed with a low-carbon energy mix of nuclear, gas and renewables. It will take many years to build up the nuclear and renewable capacity (mostly unreliable wind that is a hindrance rather than a help to the grid) and to try and develop the CCS for coal. In the meantime the plan is bogged down by the need to set a price for electricity that satisfies both government and the low-carbon vendors. This means the government may be forced into increasing the proportion of gas-fired generation as a quick fix since it can be brought online quickly but electricity prices will be high due to high gas cost and it makes the country dependent on a risky off shore fuel supply while still producing carbon dioxide and other emissions. The UK government must now wish that it’s predecessors had only used natgas for space heating to replace those smog (smoke combined with fog) producing coal fires that kept British homes warm and not wasted it on electricity generation which should have been the task of nuclear.
Something like the UK of the 1990s Ontario has access to lots of cheap gas but it’s increasingly coming from shale deposits fractured by large quantities of very high pressure water, with special sand and toxic chemicals thrown in. This controversial frackgas has been said to have the same lifetime cycle greenhouse gas emissions as coal. Despite the present historical low gas prices the real cost of electricity from the gas-fired plants is significantly more (up to twice as much) than that from Ontario’s nuclear plants. The major cause of this is the extremely profitable capacity payment (known as a Net Revenue Requirement, $ per MW per Month) contracts negotiated between the government and the private companies operating gas-fired CCGTs to meet intermediate/peak load demands. This means that in addition to paying the market rate for this CCGT generated electricity consumers also pay for the MW capacity of the plant whether it is used or not, the less the production the more the unit cost of the electricity. For example, the recently cancelled Oakville, Ontario, 900 MW gas plant that got relocated near to the gas/oil-fired Lennox Generating Station site due to local community opposition had a Net Revenue Requirement of $17,277 per MW per Month under the original 2009 contract between TransCanada Energy Ltd. and the Ontario Power Authority. The average Net Revenue Requirement for Ontario’s gas-fired fleet is $13,187 per MW per Month.
Something like the UK of today Ontario will be facing over ten years of nuclear refurbishment shutdowns starting in 2015 and government mandated shutdown of all its perfectly good coal-fired stations by 2014, some have already shutdown. This could put Ontario in an energy crunch even before 2020 when Pickering is shutdown. However unlike the UK, that has to go to foreign nuclear suppliers since it had abandoned its own nuclear capability in its fervor for gas, Ontario has its own proven Canadian designed Enhanced CANDU 6 (EC6) reactors that can be quickly got up and running at Darlington B without the need to expand precarious frackgas-fired generation. Also, four of the twelve of Ontario’s large (500 MW) publicly owned coal-fired units have flue-gas clean-up systems to reduce nitrogen oxides (Selective Catalytic Reduction on Lambton units 3 and 4 and Nanticoke units 7 and 8) and two of these units also have sulphur dioxide reduction systems (Flue Gas Desulphurization on Lambton units 3 and 4). These could be used, and at low generation cost, if the government would reconsider its closure mandate. Other countries are retrofitting their older coal-fired stations, and building new stations, with these flue gas clean-up systems to meet new emission standards so they can keep operating yet Ontario is closing them down. The other large units not fitted with flue gas clean-up systems for sulphur dioxide and nitrogen oxides reduction, although they could be, use low sulphur coal and use high efficiency burners to reduce nitrogen oxides. These could also be used since the health benefits from shutting them down are marginal at best, the case for closure based on questionable Ontario Medical Association modeling and vociferous support from the pro-gas/wind lobby groups that together influenced the provincial government. Almost all air pollution in Ontario from coal-fired generating stations came from the US and air pollution in the cities comes from vehicle traffic. The twelve large publicly owned coal-fired units that are already paid for have excellent operational flexibility and would be a better partner for wind, if wind is going to be around for a while, than the less flexible, costly, privately owned frackgas-fired CCGT units.
An improving economy and increases in the non-electricity generating uses of Canadian and US frackgas, including future Liquefied Natural Gas exports to countries where gas is much more expensive and expansion into road and rail transportation, will lead to increased gas demand, put a strain on pipeline capacity, and, like the UK, make Ontario dependent on a fuel for electricity generation that has long term risks in price and availability. Frackgas prices are volatile and will surely rise because well depletion rates are high and drilling rigs are moving on to more lucrative oil exploration, reducing supply and putting gas-fired electricity generating costs even higher. In many areas the market price of frackgas is lower than its production costs, a situation that can’t last. In an unregulated electricity market that would mean a significant price increase since fuel costs are a large fraction of gas-fired generating costs. In Ontario even though gas-fired generation costs will rise with frackgas prices the effect on Ontario’s hybrid (one could say dysfunctional) market for electricity is dampened by the much less expensive nuclear generated electricity from Bruce Power and by the regulated rates of nuclear and baseload hydro from Ontario Power Generation. Even so present day electricity prices in Ontario are amongst the highest in Canada and the US and are going higher, primarily due to excess capacity and the various contracts with gas and wind generating companies. Energy intensive manufacturing industries will not locate in Ontario or if already here will move and commodity based industries may be priced out of markets due to high energy costs.
Privately owned CCGT plants (see note 1) are parachuted into the province from foreign builders and provide a minimum of design, construction and operating jobs. Canadian designed EC6 units for Darlington B would have a Canadian supply chain and provide thousands of well paid trade and professional jobs and provide a reliable long term supply of electricity at a predictable and relatively low cost. In addition, the highly flexible EC6 units would provide for intermediate load as well as baseload replacing equivalent frackgas-fired generation, and the avoided capacity payments for gas would tend to offset the additional electricity cost of operating nuclear plants at part load.
Providing grid flexibility (load following/cycling) comes at a cost, financial and/or environmental and even political. The present Ontario grid, made up mainly of relatively inflexible baseload run-of-the-river hydro and nuclear and hindered by unreliable wind, relies for flexibility on limited amounts of stored water hydro and on frackgas-fired CCGTs that are less flexible than the coal-fired units they are replacing. CCGTs impact the environment and have costly capacity payments leading to high unit electricity cost. A future environmentally clean grid of baseload/stored water hydro and highly flexible nuclear (no gas) would require nuclear to run at part load at times (as in France where nuclear provides almost 80 percent of the electricity used) reducing the nuclear capacity factor and increasing unit electricity cost, unless use can be made of the surplus generation. Unlike gas-fired generation nuclear fuel costs are a very small fraction of total generating cost resulting in long term cost stability. A future grid of baseload/stored water hydro, wind, and frackgas-fired CCGTs (no nuclear) would have major environmental impacts from the CCGTs and frackgas extraction. The reduced capacity factors of CCGTs from load-following/cycling will increase unit electricity cost and there will be pipeline/gas plant safety issues, the need for more frackgas pipelines, non-renewable fuel availability/security issues, carbon emission costs, and indeterminate future electricity costs that will inevitably increase. When particulate matter is emitted from gas-fired CCGT power plants it is very much finer than that from coal-fired units and is more harmful since it can lodge more deeply in the lungs. In addition using frackgas for space heating and for electricity generation through an Ontario winter raises obvious conflicts that could even result in CCGT units burning oil instead of natgas, not a pleasant thought but better than the alternative, power shortages. The government decision to relocate the Oakville CCGT unit to the Lennox Generating Station site and to relocate the Mississauga CCGT unit to the Lambton Generating Station site, at very high financial (over $585 million) and political (resignation of Premier of Ontario) cost, shows that people do not want gas-fired units or high pressure natgas pipelines in their neighbourhoods. These relocations to existing major generating sites strengthen the case for expanding the present centralized nuclear generation sites, and even the sites of shutdown coal stations, with more nuclear. Back in 2008 Bruce Power applied to the nuclear regulator for a licence to prepare site for two nuclear units near the Nanticoke coal-fired generating station but despite support from local residents it did not get government support and the application was withdrawn the following year. Centralized power generation with improvements to the transmission system, including improved monitoring of equipment, is a better approach than distributed generation with polluting non-renewable fossil fueled generators sited in urban areas and controversial large industrial wind turbines located in rural areas. Retrofitting all the large highly flexible coal units at Lambton and Nanticoke with flue gas clean-up systems for sulphur dioxide and oxides of nitrogen and keeping them running would have been more cost effective in reducing air pollution than the costly less flexible frackgas-fired units and unreliable wind distributed generation approach mandated by the government.
The UK has been slow off the mark building new reactors but is now working hard to catch up with 13 planned and proposed. Nuclear is being operated, being uprated, being constructed and being planned and proposed in many countries, too many to name them all. Some examples. In Japan all the nuclear plants that were shutdown after the 2011 March earthquake/tsunami seriously damaged the Fukushima Daiichi nuclear plant will be given permission to restart once the nuclear regulator is satisfied that they meet the new safety standards. Lessons were learned and changes made after this unprecedented event, not only by Japan. China has a very ambitious nuclear program with 17 reactors in operation, 28 under construction and more ready to start construction. Like China India also has an ambitious nuclear program and expects to have 14,600 MW of nuclear on line by 2020 with more after that – Ontario presently has 13,000 MW. India has developed and is operating its own design of pressurized heavy water reactor, like CANDU, but is also allowing other vendors to build units in its rush to get more nuclear on line. Even in the solar and natgas rich area of the Gulf the United Arab Emirates is building four reactors of South Korean design. Russia, also a natgas rich state, is expanding its present large nuclear fleet by 50 percent by 2020 with further increases planned and proposed. These are examples of the many countries that know that once the initial capital investment is made a nuclear plant will be able to provide reliable power at a stable relatively low cost for 60 years and likely much longer. Even stations that are presently operating are investing in life extensions to enable them to operate for 60 years, and maybe more. A few countries have operated, are operating, are building and are developing so called fast neutron reactors. Fast reactors, called burner reactors, can generate power by utilizing the used fuel from the present generation of reactors, a vast fuel resource, such that the resultant waste will only need to be segregated from the environment for 300 years or so until it decays to the background radiation level of natural uranium. Other fast reactors, called breeder reactors, can generate power while producing, breeding, more fissile material for new fuel than they consume. The notable exception to all this nuclear activity is Germany. Because of Fukushima it has a politically motivated plan to shutdown all its well run reliable nuclear plants by 2022 and replace them by coal-fired plants, by gas-fired plants burning Russian natgas, and by imports of nuclear generated electricity mostly from France, together with costly unreliable wind/solar that also contributes to grid instability. Even today German household electricity cost is about twice that of predominantly nuclear France and will increase as will carbon emissions. Italy is the only Group of Eight (G8) country without nuclear, producing 70 percent of its electricity from fossil fuels, with electricity costs well above the European Union average, and is the world’s largest net importer of electricity including nuclear generated electricity.
In 2012 and previous years clean nuclear and hydro provided nearly 80 percent of Ontario’s electricity at low cost and with a very low overall greenhouse-gas emission intensity. Money being spent trying to reduce the greenhouse-gas emission intensity even more, by using high cost and low (if not zero) benefit frackgas and wind to replace coal, could be put to much better use elsewhere. In the future with nuclear and hydro, and the temporary use of coal for intermediate/peak supply until more new highly flexible nuclear is built (see note 2), Ontario would be immune to the inevitable increases in frackgas prices and carbon emission costs, be immune to short and long term fuel availability issues, be independent of electricity imports, and be one of the lowest emitters of greenhouse gases in the world. Or does Ontario want to follow the UK example and make the same mistake that it made 20 years ago when it built gas-fired CCGT power plants instead of continuing to build nuclear power plants?
1. Before his 35 years in the Canadian nuclear industry the author spent five years as an engineer in the Technical Department of Orenda Engines Ltd., Malton, Ontario, a company that designed and manufactured gas turbine engines and certainly appreciates the sophisticated engineering that goes into the present day CCGT units.
2. “An alternative Long-term Energy Plan for Ontario – Greenhouse gas-free electricity by 2045”, Don Jones, 2011 May 30, http://coldaircurrents.blogspot.ca/2011/05/alternative-long-term-energy-plan-for.html