What the Long-Term Energy Plan Means for Your Municipality

Posted: November 29, 2017
Tagged As: Electric Vehicles, Electricity, Energy, Energy Bills, Energy Planning

On October 26th the Ministry of Energy released the Province of Ontario’s 2017 Long-Term Energy Plan (LTEP), titled Delivering Fairness and Choice.  This year’s LTEP focuses predominately on the consumer, the prices they pay, and the future landscape of the innovative energy system from which they draw power.  Though most references to the consumer take specific aim at the individual or “resident,” the LTEP certainly has implications on Ontario municipalities as it relates to fairness and choice

Fairness

As its title indicates, the LTEP seeks to deliver fairness and choice to consumers.  Fairness through more affordable energy, and choice through increased alternatives in how consumers generate, use and pay for it.  A significant portion of fairness addresses steps the government has already taken to make energy more affordable, all of which would have an impact on the majority of municipal hydro accounts:
  • Reducing residential, small business, and farming bills by an average of 25% through Ontario’s Fair Hydro Plan
  • Capping rate increases to the rate of inflation for the next four years
  • Refinancing a portion of the Global Adjustment, spreading the costs over a longer period of time

Choice

When it comes to the topic of choice, the LTEP opens the door to a whole new world of possibilities, but does little to walk through it by recommending which path is best to take.  Rather, the LTEP presents the alternatives available to consumers and ultimately leaves the decision up to the individual, municipal government, Local Distribution Company (LDCs), or the private sector entity consuming energy to choose which opportunities to pursue.  So what are these alternatives?

Forms of Modernization & Innovation on the Horizon? 

The LTEP sets the stage for a new era of energy use in Ontario.  New pricing plans, improvements to net metering, the implementation of energy storage, and the electrification of transportation are all subject areas aimed at providing more choice to consumers through technological advancements. 
 
Electricity pricing has long be a discussion point in this province, and changes to the current pricing plans would be welcomed by many.  Currently there are pilot projects testing a variety of price structures that include different ratios between on and off-peak prices, different times for on and off-peak periods, pricing that increases during critical peaks, and seasonal pricing plans that have flat rates for spring / fall and on- and off-peak pricing for summer / winter.  Some of these pilots are coupled with smart technologies (e.g. thermostats, lighting, etc.) and an energy user app for smartphones to give customers additional control over their electricity use.
 
Improvements to net metering will provide increased opportunity to generate and store renewable electricity, allowing consumers to offset electricity bought from their LDC with that generated from their own renewable energy systems, thereby reducing the overall cost appearing on their bill.   
 
Energy storage is a potential game-changer, providing the means for consumers to save energy for later use, reducing the need to build new supply or import electricity, and providing backup services to buildings when hydro in unavailable.  Testing is currently underway for a variety of storage technologies to uncover the benefits of each system.   Methods of storage range from home ‘powerwalls’ to massive reservoirs holding ‘potential energy,’ as well as batteries at the base of wind turbines, all of which could help store and use energy more efficiently. 
 
As Ontario continues to move to a low / no carbon economy, the electrification of vehicles will have significant impact on distribution networks, placing additional strain on them.  If too many EVs in the same area charge at the same time, additional strain is placed on the distribution system.  As EVs become more popular, utilities will need tools to manage the growth in a cost-effective way.  Utilities and private sector firms, such as LAS’ Fleet Management Service partner FleetCarma, are testing ways to guarantee EV owners the amount of charge they need in the morning, but allow an LDC to control the charging to minimize the impact on distribution networks.  This may include reduced costs to consumer in exchange for that control over charging activity.
 
Regardless of which of the above innovations your municipality might choose to pursue, each is dependant on a modern, digital Smart Grid to harness the power of data so customers and utilities can make the right decisions for themselves.  The LTEP gives an overview of all these new directions, but ultimately it will be up to the provincial government, the Ontario Energy Board (OEB), the Independent Electricity System Operator (IESO) and LDCs to ensure that the correct infrastructure is in place in order for consumers to realize these opportunities. 

Getting Ready for the Changes Ahead

As LDCs will play a large part in the future landscape of electricity in Ontario, it is important to have a good relationship with your Local Distribution Company, even if it is a large company like Hydro One.  LDCs can keep you posted on upcoming changes to your network, as well as what new opportunities may come online as a result of those changes.  They can also provide you data that can lend assistance in reducing your consumption and related costs.
 
Every year at July 1st municipalities are required to submit annual energy uses for their facilities under O. Reg. 397/11, but are there other ways that a municipality can make use this information?  Does your municipality have a community energy plan, and if so, when was the last time it was reviewed and updated?  And (how) will the above mentioned items impact its future direction?  
 
Finally, are you participating in IESO regional energy planning roundtables?  Community roundtables provide your municipality the opportunity to provide insight and feedback that influence the priorities and direction of the Ontario electricity landscape.  It’s important to share the municipal perspective so it too can be captured in the future plans for energy in Ontario.
 
The LTEP does a sound job of identifying existing and potential new energy sources, their relative importance and current challenges, providing readers with a good sense of what the issues are and the kinds of opportunities leadership can bring about.  At the end of the day, it will be up to municipal government to determine which opportunities they pursue, and how they might use those opportunities to inspire others in their community to grab the torch and run with it.

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