September 25, 2017

Affordable Energy News Service for September 25, 2017

Affordable Energy News Service for September 25, 2017

Ontario, Quebec, and California ink climate-change deal — Robert Benzie


Ontario, Quebec, and California ink climate-change deal — Robert Benzie

The most powerful sub-national leader in the world says he, Ontario Premier Kathleen Wynne and Quebec’s Philippe Couillard are “insurgent forces” in the global fight to curb climate change. California Gov. Jerry Brown, whose state has the world’s sixth-largest economy — larger than that of Canada, France or India — said it does not matter what President Donald Trump or the U.S. Congress does to try to derail efforts to reduce greenhouse gas emissions. “Whatever anyone else does and whatever Mr. Trump does in Washington, China is on the move with a carbon market,” Brown said in Quebec City as California, Quebec and Ontario signed an agreement to formally link their carbon markets. “There’s a lot of money on the other side and that’s the status quo. We’re the insurgent forces transforming. That’s where it’s at. In our systems, the sub-national jurisdictions have a power,” he said, noting states and provinces can oversee clean-air standards, building codes, and promote electric vehicles. - Toronto Star  


Digging down Ontario's cap and trade plan — Lorrie Goldstein

With Premier Kathleen Wynne announcing yet again on Friday that Ontario will join the California/Quebec cap-and-trade carbon pricing market Jan. 1 — today, let’s consider some important questions. For example, will it work? Will it effectively lower Ontario’s industrial greenhouse gas emissions linked to climate change, given that we’re paying for it? The government says cap and trade will cost the average Ontario household $156 this year alone. Its own numbers, however, suggest the cost is $357. That is, $2-billion in new government revenue from cap and trade, divided by Ontario’s 5,598,391 households, according to the 2016 census. Here’s what Auditor General Bonnie Lysyk said about the expected effectiveness of Ontario’s cap and trade scheme in her annual report last year: “Our audit indicates the cap-and-trade system will result in only a small portion of the required greenhouse-gas reductions needed to meet Ontario’s 2020 target.” - Toronto Sun  


Carbon tax costs must be disclosed — Sun editorial

An opposition bill in Ontario is serving as a great symbol of the need to be up front about the costs of carbon taxes on everyday families. In January, the governing provincial Liberals rolled out their cap-and-trade carbon pricing scheme. Prices at the gas pumps jumped up immediately by several cents. Likewise, cap-and-trade increased the costs to natural gas home heating bills. But ratepayers still don’t know by how much. They may see their bills go up, but the cap-and-trade component is jumbled in among other fees. It’s not a distinct line item. Enter Ontario Progressive Conservative MPP Monte McNaughton, who introduced a bill that would instruct natural gas companies to put the cap-and-trade costs on a separate line item. It’s an excellent idea. When we go shopping, sales taxes appear as separate items. It’s the same on utilities bills. And cap-and-trade is a tax by another name. So show it. - Toronto Sun


Newfoundland and the curse of energy independence — Barrie McKenna

Churchill Falls still haunts Newfoundland nearly half a century later. Under a now-infamous 1969 contract, Hydro-Quebec gets to buy virtually all the power from the Labrador hydroelectric project at pre-1970s oil crisis prices until 2041, with no adjustment for inflation. The arrangement is worth hundreds of millions of dollars in profits every year to the Quebec utility. Never again, Newfoundlanders said. The province vowed to do things differently to exploit the hydro potential of the lower Churchill River, including the Muskrat Falls project. And it did. Former premier Danny Williams rejected the idea of selling most of the power from Muskrat Falls to Hydro-Quebec, opting instead to go it alone. So the province is repatriating the power to Newfoundland and financing a circuitous underwater transmission line to Nova Scotia. The unfortunate consequence of this energy hubris is that instead of being cheated by its neighbour, Newfoundlanders are fleecing themselves. Delays and cost overruns on the $12.7-billion megaproject will cause residential hydro rates to more than double across Newfoundland by 2022. That's according to Nalcor Energy, the provincial Crown corporation that's building the project, with loan guarantees from Ottawa. - Globe & Mail


“Concerning and unacceptable,” mayors try to save Energy East — John Chilibeck

Two mayors whose communities have a big stake in the proposed Energy East pipeline are asking the national regulator to save the project. Saint John Mayor Don Darling and Calgary Mayor Naheed Nenshi appeared together at a news conference Friday in the Alberta city, arguing TransCanada’s $15.7-billion proposal wasn’t dead and that what was mostly needed was clarity from the National Energy Board and the Canadian government on how the company could proceed. “All Canadians can benefit from the Energy East pipeline,” Darling said at the Calgary press conference. “Three years into the process and the rules are changing. This is concerning and unacceptable.” Darling was referring to the National Energy Board’s recent decision to include, as part of the regulatory process, an assessment of what the upstream and downstream costs would be for increased greenhouses gases, a harbinger for global warming. The regulator added the requirement based on the demands of Justin Trudeau’s Liberal government, which has tried to show leadership on climate change. It led to TransCanada announcing earlier this month it was temporarily suspending its application to build the pipeline that would connect Alberta’s oil sands with refineries in Quebec and New Brunswick, so that it could further review what the new requirements would mean. - Telegraph Journal


Canada must clarify its national carbon policy — Dennis McGonaghy & Jack Mintz

Are Canadians being well served by what currently exists as national carbon and pipeline regulatory policies? Do they represent a reasonable balance between Canada credibly contributing to dealing with the risk of global climate change and capturing the economic potential of Canada's hydrocarbon resource? Instead of stepping up to provide needed clarity and transparency, the government has only allowed ambiguity to persist. This has begun to cost Canada. As a case in point, see the recent decision taken by TransCanada Pipelines to suspend the Energy East project because of the recent decision of the National Energy Board to "re-scope" its regulatory approval process to consider whether upstream and downstream carbon impacts attributable to Energy East are consistent with national carbon policy. - Globe & Mail


Site C dam project draws criticism at Vancouver public input session — CP

Robert McCullough of the Oregon-based firm McCullough Research, taking part in a public input session about the $8.8-billion project in Vancouver on Saturday, said that building dams for energy is an outdated practice. He said the cost of renewable energy sources like wind and solar have decreased dramatically in the last five years and building a dam over the Peace River doesn’t make sense. “The era of big iron has passed,” he said. “We just have had a technological change that people are adjusting to now. We can actually save $1-billion dollars by simply abandoning the project and going to other technologies.” McCullough said his firm would also be providing the utilities commission more detailed analysis of the project. The province’s new NDP government directed the utilities commission to review the economic viability of the megaproject that was initiated by the former B.C. Liberal premier Christy Clark. Proponents of the project have said it will create hundreds of jobs and support the province’s future energy needs. - Vancouver Sun  


Ontario premier says she was misunderstood by Quebec party leader during meeting — Caroline Plante

Ontario Premier Kathleen Wynne contradicted the leader of one of Quebec's opposition parties Friday, saying he misunderstood their private conversation and shouldn't have publicly revealed its contents on the internet. On Thursday, the leader of the Coalition for Quebec's Future (CAQ) published a tweet congratulating himself for having interested Wynne in his party's energy strategy. "The premier of Ontario is open to the CAQ's plan to build new dams to export more electricity to Ontario," Francois Legault wrote on his Twitter account. The following day, Wynne insisted she had never endorsed the party's plan and had raised questions about potential environmental issues during her conversation with Legault. "It is simply not the case that I made any commitment to a plan or that I said I was open to a plan," she said at a news conference in Quebec City alongside Quebec Premier Philippe Couillard. Couillard described Legault's actions as "worrisome" and noted he appeared to have forgotten Ontario currently has an electricity surplus. - National Observer  


United States

Enbridge Line 3 pipeline debate shifts to public hearings — AP

Minnesota kicks off public hearings this week on whether regulators should allow Enbridge Energy to replace its aging Line 3 crude oil pipeline across northern Minnesota. The replacement would have higher capacity than the existing pipeline and run along a new route in some areas — two characteristics that opponents say shows it’s more like a new pipeline than a replacement. Environmental and tribal groups say they expect hundreds of people to protest and march against the project before Thursday’s hearing in St. Paul. They’ve been buoyed by a recent review from the state Commerce Department, which surprised opponents and Enbridge alike by concluding the project isn’t needed and won’t benefit Minnesota. But Enbridge says Line 3 is a critical piece of infrastructure for petroleum shippers and refineries in the region. Oil pipelines have become an increasingly contentious national issue amid concerns about tar sands oil and climate change, the danger that spills pose to water supplies, and the rights of American Indians who live along the routes. - Edmonton Journal



Australian Energy Market Operator warns gas “shortfall could be higher than expected” — Mark Ludlow

The closure of Hazelwood coal-fired power station in Victoria and the greater need for gas-fired generation in South Australia has lead to a significant risk of a gas shortfall in eastern states over the next two years, the Australian Energy Market Operator (AEMO) has warned. With Prime Minster Malcolm Turnbull and Deputy Prime Minister Barnaby Joyce briefing industry leaders in Sydney on Monday about possible restrictions on gas exports, the move to secure more gas for the domestic market could be enacted within weeks and will hit all the big gas producers including Origin Energy, Santos and Shell. The AEMO report said the projected shortfall risk for 2018 was between 54 petajoules to 107 petajoules, and between 48 petajoules and 102 petajoules in 2019, with a credible risk it could be at the higher end of the scale in both years. This is three times more than the forecast earlier this year. - Australian Financial Review  


Other International

Russia's Gazprom topples U.S. behemoth ExxonMobil as the world's leading energy company — Gaurav Sharma

Russia's Gazprom has snagged the crown of the world's leading energy company, ending U.S. oil and gas behemoth ExxonMobil's 12-year reign atop the leader-board. What's worse, poorer returns from a lower oil price meant ExxonMobil barely managed to stay within the top 10 — coming in at 9th place — in ratings agency S&P Global Platts' annual corporate rankings for the energy sector. While the Russian company — which has natural gas exploration and trading at its core and the Kremlin's benign backing — topped the list, Platts said Gazprom's rise mirrored a pattern in favour of gas, utilities and pipeline companies leading the way this year. - B Times