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Ontario electricity pricing consultations will gather business input on OEB rate design, Industrial Conservation Initiative, dynamic pricing, global adjustment, and system costs through online feedback and sector-specific in-person sessions province-wide.

Key Points

Consultations gathering business input on rates, programs, and OEB policy to improve fairness and reduce system costs.

✅ Consults on ICI, GA, dynamic pricing structures

✅ Seeks views on OEB C&I rate design changes

✅ In-person sessions across key industrial sectors

The Ontario government has announced plans to hold consultations to seek input from businesses about industrial electricity pricing and programs. This will be done through Ontario's online consultations directory and though in-person sector-specific consultation sessions across the province. The in-person sessions will be held in all areas of Ontario, and will target "key industries," including automotive and the build-out of electric vehicle charging stations infrastructure, forestry, mining, agriculture, steel, manufacturing and chemicals.

On April 1, 2019, the Ontario government published a consultation notice for this process, confirming that it is looking for input on "electricity rate design, existing tax-based incentives, reducing system costs and regulatory and delivery costs," including related proposals such as the hydrogen rate reduction proposal under discussion. The consultation process includes a list of nine questions for respondents (and presumably participants in the in-person sessions) to address. These include questions about:

The benefits of the Industrial Conservation Initiative (described below), including how it could be changed to improve fairness and industrial competitiveness, and how it could complement programs like the Hydrogen Innovation Fund that support industrial innovation.

Dynamic pricing structures that allow for lower rates in return for responding to price signals versus a flat rate structure that potentially costs more, but is more stable and predictable, as Ontario's energy storage expansion accelerates.

Interest in an all-in commodity contract with an electricity retailer, even if it involves a risk premium.

Interested parties are invited to submit their comments before May 31, 2019.

The government's consultation announcement follows recent developments in the Ontario Energy Board's (OEB) review of electricity ratemaking for commercial and industrial customers, and intertie projects such as the Lake Erie Connector that could affect market dynamics.

In December 2018, the OEB published a paper from its Market Surveillance Panel (MSP) examining the Industrial Conservation Initiative (ICI), and potential alternative approaches. The ICI is a program that allows qualifying large industrial customers to base their global adjustment (GA) payments on their consumption during five peak demand hours in a year. Customers who find ways to reduce consumption at those times, perhaps through DERs and enabling energy storage options, will reduce their electricity costs. This shifts GA costs to other customers. The MSP found that the ICI does not fairly allocate costs to those who cause them and/or benefit from them, and recommends that a better approach should be developed.

In February 2019, the OEB released its Staff Report to the Board on Rate Design for Commercial and Industrial Electricity Customers, setting out recommendations for new rate designs for electricity commercial and industrial (C&I) rate classes as Ontario increasingly turns to battery storage to meet rising demand. As described in an earlier post, the Staff Report includes recommendations to: (i) establish a fixed distribution charge for commercial customers with demands under 10 kW; (ii) implement a demand charge (rather than the current volumetric charge) for C&I customers with demands between 10kW and 50kW; and (iii) introduce a "capacity reserve charge" for customers with load displacement generation to replace stand-by charges and provide for recognition of the benefits of this generation on the system. The OEB held a stakeholder information session in mid-March on this initiative, and interested parties are now filing submissions in response to the Staff Report.

Whether and how the OEB's processes will fit together with the government's consultation process remains to be seen.

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NDC Renewable Energy Ambition drives COP25 calls to align with the Paris Agreement, as IRENA urges 2030 targets toward 7.7 TW, accelerating decarbonization, energy transition, socio-economic benefits, and scalable renewables in Nationally Determined Contributions.

Key Points

Raised 2030 renewable targets in NDCs to meet Paris goals, reaching 7.7 TW efficiently and speeding decarbonization.

✅ Double current NDC renewables to align with 7.7 TW by 2030

✅ Cost effective pathway with jobs, growth, welfare gains

✅ Accelerates decarbonization and energy access per UN goals

We need an oracle to get us out of this debacle. The UN climate group has met for the 25th time. Will anything ever change?

Countries are being urged to significantly raise renewable energy ambition and adopt targets to transform the global energy system in the next round of Nationally Determined Contributions (NDCs), according to a new IRENA report by the International Renewable Energy Agency (IRENA) that will be released at the UN Climate Change Conference (COP25) in Madrid.

The report will show that renewable energy ambition within NDCs would have to more than double by 2030 to put the world in line with the Paris Agreement goals, cost-effectively reaching 7.7 terawatts (TW) of globally installed capacity by then. Today’s renewable energy pledges under the NDCs are falling short of this, targeting only 3.2 TW, even as over 30% of global electricity is already generated from renewables.

The reportNDCs in 2020: Advancing Renewables in the Power Sector and Beyondwill be released at IRENA’s official side event on enhancing NDCs and raising ambition on 11 December 2019.It will state that with over 2.3 TW installed renewable capacity today, following a record year for renewables in 2016, almost half of the additional renewable energy capacity foreseen by current NDCs has already been installed.

The analysis will also highlight that delivering on increased renewable energy ambition can be achieved in a cost-effective way and with considerable socio-economic benefits across the world.

“Increasing renewable energy targets is absolutely necessary,” said IRENA’s Director-General Francesco La Camera. “Much more is possible. There is a decisive opportunity for policy makers to step up climate action, including a fossil fuel lockdown, by raising ambition on renewables, which are the only immediate solution to meet rising energy demand whilst decarbonizing the economy and building resilience.

“IRENA’s analysis shows that a pathway to a decarbonised economy is technologically possible and socially and economically beneficial,” continued Mr. La Camera.

“Renewables are good for growth, good for job creation and deliver significant welfare benefits. With renewables, we can also expand energy access and help eradicate energy poverty by ensuring clean, affordable and sustainable electricity for all in line with the UN Sustainable Development Agenda 2030.

IRENA will promote knowledge exchange, strengthen partnerships and work with all stakeholders to catalyse action on the ground. We are engaging with countries and regions worldwide, from Ireland's green electricity push to other markets, to facilitate renewable energy projects and raise their ambitions”.

NDCs must become a driving force for an accelerated global energy transformation toward 100% renewable energy globally. The current pledges reflect neither the past decade’s rapid growth nor the ongoing market trends for renewables. Through a higher renewable energy ambition, NDCs could serve to advance multiple climate and development objectives.

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London Tube Strikes Economic Impact highlights transport disruption reducing foot traffic, commuter flows, and tourism, squeezing small businesses, hospitality revenue, and citywide growth while business leaders urge negotiations, resolution, and policy responses to stabilize operations.

Key Points

Reduced transport options cut foot traffic and sales, straining small businesses and slowing London-wide growth.

✅ Hospitality venues report lower revenue and temporary closures

✅ Commuter and tourism declines reduce daily sales and bookings

✅ Business groups urge swift negotiations to restore services

London's economy is facing significant challenges due to ongoing tube strikes, challenges that are compounded by scrutiny of UK energy network profits and broader cost pressures across sectors, with businesses across the city experiencing disruptions that are impacting their operations and bottom lines.

Impact on Small Businesses

Small businesses, particularly those in the hospitality sector, are bearing the brunt of the disruptions caused by the strikes. Many establishments rely on the steady flow of commuters and tourists that the tube system facilitates, while also hoping for measures like temporary electricity bill relief that can ease operating costs during downturns. With reduced transportation options, foot traffic has dwindled, leading to decreased sales and, in some cases, temporary closures.

Economic Consequences

The strikes are not only affecting individual businesses but are also having a ripple effect on the broader economy, a dynamic seen when commercial electricity consumption plummeted in B.C. during the pandemic. The reduced activity in key sectors is contributing to a slowdown in economic growth, echoing periods when BC Hydro demand fell 10% and prompting policy responses such as Ontario electricity rate reductions for businesses, with potential long-term consequences if the disruptions continue.

Calls for Resolution

Business leaders and industry groups are urging for a swift resolution to the strikes. They emphasize the need for dialogue between the involved parties to reach an agreement that minimizes further economic damage and restores normalcy to the city's transportation system.

The ongoing tube strikes in London are causing significant disruptions to the city's economy, particularly affecting small businesses that depend on the efficient movement of people. Immediate action is needed to address the issues, drawing on tools like a subsidized hydro plan used elsewhere to spur recovery, to prevent further economic downturn.

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Twin States Clean Energy Link connects New England to Hydro-Quebec via a 1,200 MW transmission line, DOE-backed capacity, underground segments, existing corridors, boosting renewable energy reliability across Vermont and New Hampshire with cross-border grid flexibility.

Key Points

DOE-backed 1,200 MW line linking Hydro-Quebec to New England, adding clean capacity with underground routes.

✅ 1,200 MW cross-border capacity for the New England grid

✅ Uses existing corridors; underground in VT and northern NH

✅ DOE capacity contract lowers risk and spurs investment

A proposal to build a new transmission line to connect New England with Canadian hydropower is one step closer to reality.

The U.S. Department of Energy announced Monday that it has selected the Twin States Clean Energy Link as one of three transmission projects that will be part of its $1.3 billion cross-border transmission initiative to add capacity to the grid.

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Twin States is a proposal from National Grid, a utility company that serves Massachusetts, New York, and Rhode Island, and also owns transmission in England and Wales as the region advances projects like the Scotland-to-England subsea link that expand renewable flows, and the non-profit Citizens Energy Corporation.

The transmission line would connect New England with power from Hydro-Quebec, moving into the United States from Canada in Northern Vermont and crossing into New Hampshire near Dalton. It would run through parts of Grafton, Merrimack, and Hillsborough counties, routing through a substation in Dunbarton and ending at a proposed new substation in Londonderry. (Here's a map of the Twin States proposal.)

The federal funding will allow the U.S. Department of Energy to purchase capacity on the planned transmission line, which officials say reduces the risk for other investors and can help encourage others to purchase capacity.

The project has gotten support from local officials in Vermont and New Hampshire, but there are still hurdles to cross. The contract negotiation process is beginning, National Grid said, and the proposal still needs approvals from regulators before construction could begin.

First Nations communities in Canada have opposed transmission lines connecting Hydro-Quebec with New England in the past, and the company has faced scrutiny from environmental groups.

What would Twin States look like?
Transmission projects, like the failed Northern Pass proposal, have been controversial in New England, though the Great Northern Transmission Line progressed in Minnesota.

But Reihaneh Irani-Famili, vice president of capital delivery, project management and construction at National Grid, said this one is different because the developers listened to community concerns before planning the project.

“They did not want new corridors of infrastructure, so we made sure that we're using existing right of way,” she said. “They did not want the visual impact and some of the newer corridors of infrastructure, we're making sure we're undergrounding portions of the line.”

In Vermont and northern New Hampshire, the transmission lines would be buried underground along state roads. South of Littleton, they would be located within existing transmission corridors.

The developers say the lines could provide 1,200 megawatts of transmission capacity. The project would have the ability to carry electricity from hydro facilities in Quebec to New England, and would also be able to bring electricity from New England into Quebec, a step toward broader macrogrid connectivity across regions.

“Those hydro dams become giant green batteries for the region, and they hold that water until we need the electrons,” Irani-Famili said. “So if you think about our energy system not as one that sees borders, but one that sees resources, this is connecting the Quebec resources to the New England resources and helping all of us get into that cleaner energy future with a lot less build than we otherwise would have.”

Irani-Famili says the transmission line could help facilitate more clean energy resources like offshore wind coming online. In a report released last week by New Hampshire’s Department of Energy, authors said importing Canadian hydropower could be one of the most cost-effective ways to move away from fossil fuels on the electric grid.

National Grid estimates the project will help save energy customers $8.3 billion in its first 12 years. The developers are constructing a $260 million “community benefits plan” that would take some profits from the transmission line and give that money back to communities that host the transmission lines and environmental justice communities in New England.

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Drax Biomass Conversion accelerates renewable energy by replacing coal with wood pellets, sustainable forestry feedstock, and piloting carbon capture and storage, supporting the UK grid, emissions cuts, and a net-zero pathway.

Key Points

Drax Biomass Conversion is Drax's shift from coal to biomass with CCS pilots to cut emissions and aid UK's net-zero.

✅ Coal units converted to biomass wood pellets

✅ Sourced from sustainable forestry residues

✅ CCS pilots target lifecycle emissions cuts

A power station that used to be the biggest polluter in western Europe has made a near-complete switch to renewable energy, mirroring broader shifts as Denmark's largest energy company plans to end coal by 2023.

The Drax Power Station in Yorkshire, England, used to spew out millions of tons of carbon dioxide a year by burning coal. But over the past eight years, it has overhauled its operations by converting four of its six coal-fired units to biomass. The plant's owners say it now generates 15% of the country's renewable power, as Britain recently went a full week without coal power for the first time.

The change means that just 6% of the utility's power now comes from coal, as the wider UK coal share hits record lows across the national electricity system. The ultimate goal is to stop using coal altogether.

"We've probably reduced our emissions more than any other utility in the world by transforming the way we generate power," Will Gardner, CEO of the Drax Group, told CNN Business.

Subsidies have helped finance the switch to biomass, which consists of plant and agricultural matter and is viewed as a promising substitute for coal, and utilities such as Nova Scotia Power are also increasing biomass use. Last year, Drax received £789 million ($1 billion) in government support.

Is biomass good for the environment?

While scientists disagree over the extent to which biomass as a fuel is environmentally friendly, and some environmentalists urge reducing biomass use amid concerns about lifecycle emissions, Drax highlights that its supplies come from from sustainably managed and growing forests.

Most of the biomass used by Drax consists of low-grade wood, sawmill residue and trees with little commercial value from the United States. The material is compressed into sawdust pellets.

Gardner says that by purchasing bits of wood not used for construction or furniture, Drax makes it more financially viable for forests to be replanted. And planting new trees helps offset biomass emissions.

Forests "absorb carbon as they're growing, once they reach maturity, they stop absorbing carbon," said Raphael Slade, a senior research fellow at Imperial College London.

But John Sterman, a professor at MIT's Sloan School of Management, says that in the short term burning wood pellets adds more carbon to the atmosphere than burning coal.

That carbon can be absorbed by new trees, but Sterman says the process can take decades.

"If you're looking at five years, [biomass is] not very good ... If you're looking at a century-long time scale, which is the sort of time scale that many foresters plan, then [biomass] can be a lot more beneficial," says Slade.

Carbon capture

Enter carbon capture and storage technology, which seeks to prevent CO2 emissions from entering the atmosphere and has been touted as a possible solution to the climate crisis.

Drax, for example, is developing a system to capture the carbon it produces from burning biomass. But that could be 10 years away.

The Coal King is racing to avoid bankruptcy

The power station is currently capturing just 1 metric ton of CO2 emissions per day. Gardner says it hopes to increase this to 10,000 metric tons per day by the mid to late 2020s.

"The technology works but scaling it up and rolling it out, and financing it, are going to be significant challenges," says Slade.

The Intergovernmental Panel on Climate Change shares this view. The group said in a 2018 report that while the potential for CO2 capture and storage was considerable, its importance in the fight against climate change would depend on financial incentives for deployment, and whether the risks of storage could be successfully managed. These include a potential CO2 pipeline break.

In the United Kingdom, the government believes that carbon capture and storage will be crucial to reaching its goal of achieving net-zero greenhouse gas emissions by 2050, even as low-carbon generation stalled in 2019 according to industry analysis.

It has committed to consulting on a market-based industrial carbon capture framework and in June awarded £26 million ($33 million) in funding for nine carbon capture, usage and storage projects, amid record coal-free generation on the British grid.

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Ukraine-ENTSO-E Grid Synchronization links Ukraine and Moldova to the European grid via secure interconnection, matching frequency for stability, resilience, and energy security, enabling cross-border support, islanding recovery, and coordinated load balancing during wartime disruptions.

Key Points

Rapid alignment of Ukraine and Moldova into the European grid to enable secure interconnection and system stability.

✅ Matches 50 Hz frequency across interconnected systems

✅ Enables cross-border support and electricity trading

✅ Improves resilience, stability, and energy security

On February 24 Ukraine’s electric grid operator disconnected the country’s power system from the larger Russian-operated network to which it had always been linked. The long-planned disconnection was meant to be a 72-hour trial proving that Ukraine could operate on its own and to protect electricity supply before winter as contingencies were tested. The test was a requirement for eventually linking with the European grid, which Ukraine had been working toward since 2017. But four hours after the exercise started, Russia invaded.

Ukraine’s connection to Europe—which was not supposed to occur until 2023—became urgent, and engineers aimed to safely achieve it in just a matter of weeks. On March 16 they reached the key milestone of synchronizing the two systems. It was “a year’s work in two weeks,” according to a statement by Kadri Simson, the European Union commissioner for energy. That is unusual in this field. “For [power grid operators] to move this quickly and with such agility is unprecedented,” says Paul Deane, an energy policy researcher at the University College Cork in Ireland. “No power system has ever synchronized this quickly before.”

Ukraine initiated the process of joining Europe’s grid in 2005 and began working toward that goal in earnest in 2017, as did Moldova. It was part of an ongoing effort to align with Europe, as seen in the Baltic states’ disconnection from the Russian grid, and decrease reliance on Russia, which had repeatedly threatened Ukraine’s sovereignty. “Ukraine simply wanted to decouple from Russian dominance in every sense of the word, and the grid is part of that,” says Suriya Jayanti, an Eastern European policy expert and former U.S. diplomat who served as energy chief at the U.S. embassy in Kyiv from 2018 to 2020.

After the late February trial period, Ukrenergo, the Ukrainian grid operator, had intended to temporarily rejoin the system that powers Russia and Belarus. But the Russian invasion made that untenable. “That left Ukraine in isolation mode, which would be incredibly dangerous from a power supply perspective,” Jayanti says. “It means that there’s nowhere for Ukraine to import electricity from. It’s an orphan.” That was a particularly precarious situation given Russian attacks on key energy infrastructure such as the Zaporizhzhia nuclear power plant and ongoing strikes on Ukraine’s power grid that posed continuing risks. (According to Jayanti, Ukraine’s grid was ultimately able to run alone for as long as it did because power demand dropped by about a third as Ukrainians fled the country.)

Three days after the invasion, Ukrenergo sent a letter to the European Network of Transmission System Operators for Electricity (ENTSO-E) requesting authorization to connect to the European grid early. Moldelectrica, the Moldovan operator, made the same request the following day. While European operators wanted to support Ukraine, they had to protect their own grids, amid renewed focus on protecting the U.S. power grid from Russian hacking, so the emergency connection process had to be done carefully. “Utilities and system operators are notoriously risk-averse because the job is to keep the lights on, to keep everyone safe,” says Laura Mehigan, an energy researcher at University College Cork.

An electric grid is a network of power-generating sources and transmission infrastructure that produces electricity and carries it from places such as power plants, wind farms and solar arrays to houses, hospitals and public transit systems. “You can’t just experiment with a power system and hope that it works,” Deane says. Getting power where it is it needed when it is needed is an intricate process, and there is little room for error, as incidents involving Russian hackers targeting U.S. utilities have highlighted for operators worldwide.

Crucial to this mission is grid interconnection. Linked systems can share electricity across vast areas, often using HVDC technology, so that a surplus of energy generated in one location can meet demand in another. “More interconnection means we can move power around more quickly, more efficiently, more cost effectively and take advantage of low-carbon or zero-carbon power sources,” says James Glynn, a senior research scholar at the Center on Global Energy Policy at Columbia University. But connecting these massive networks with many moving parts is no small order.

One of the primary challenges of interconnecting grids is synchronizing them, which is what Ukrenergo, Moldelectrica and ENTSO-E accomplished last week. Synchronization is essential for sharing electricity. The task involves aligning the frequencies of every energy-generation facility in the connecting systems. Frequency is like the heartbeat of the electric grid. Across Europe, energy-generating turbines spin 50 times per second in near-perfect unison, and when disputes disrupt that balance, slow clocks across Europe can result, reminding operators of the stakes. For Ukraine and Moldova to join in, their systems had to be adjusted to match that rhythm. “We can’t stop the power system for an hour and then try to synchronize,” Deane says. “This has to be done while the system is operating.” It is like jumping onto a moving train or a spinning ride at the playground: the train or ride is not stopping, so you had better time the jump perfectly.

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