Parker Gallant: Maximizing the mess with Ontario's electricity assets

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Ontario's electricity system has not yet passed gas

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Ontario’s electricity system includes generators fueled by natural gas. This is suddenly a hot topic as a campaign lobbying councils to say no to this type of generation moves through municipalities. The “no gas” lobbying appeals to a desire to reduce greenhouse gas emissions, exploiting predictions of increased use of natural gas in generating electricity in the province. This article will explore what entities have been the key drivers of emissions in Ontario’s electricity system, the credibility of the body being cited predicting increased generation fueled by natural gas and, if all goes well, convince the reader they are not willing to decrease global carbon emissions at any cost. Background on the IESO’s pretend market My previous post reconstructed a method to estimate losses on electricity exports out of Ontario. The measure does not indicate Ontario would be better off if it didn’t export its excess, but that Ontario would be better off with data discipline and consistent me...
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Hurting Michigan

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Parker Gallant has called for the Ontario government to "shutdown the intertie line with Michigan" - in an article that notes some of my work. I feel I should offer some support as Michigan is being a lousy neighbour and it would feel therapeutic, if nothing else, to respond. I'll try to stick to data. The system operator in Ontario (IESO) data indicates the Michigan intertie is the most lucrative for exports - but that's not saying much: exports at that intertie were bought in Ontario for an average of just 1.2 cents/kWh ($12/MWh) in 2020 - but were in such high demand another 0.9 cents/kWh of congestion rent was paid. Over the past 5 years congestion rents comprise 46% of the revenue on the Michigan intertie. The IESO's insiders' committees are considering how much of  this revenue to share with the exporters instead allowing it to solely benefit internal Ontario consumers. Action #1: hell no. Issue a ministerial directive that congestion rents will only b...
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Notes on IESO Supply/Demand outlook to 2035

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This post originally appeared on my tumblr account last Friday night. I’ve flipped through a slide deck Ontario’s electricity system operator, the IESO, has posted prior to insiders meeting March 23rd to discuss how the market should be manipulated in the future. I’m going to run off some comments on the Preliminary Outlook and Discussion: Ontario Supply/Demand Balance to 2035 slides here. That first point may sound flip, but if anybody detects a hint of the implication a market signal could trigger economic actors to enter, or exit, the market for electricity generation in the province, please let me know. For me the headline is this is a central planning document which would go nicely with a call to return to a unified public Ontario Hydro model. After 14 years Ontario neither has a competitive market nor does it demonstrate any learning of what that is and how it might be accomplished. First, for no particular reason, I’ll note slide 23 - which struck me due to its display of poss...
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