Fossil fuels outpace green energy

By Reuters


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Fossil fuel investments will continue to outstrip low-carbon alternatives this year, darkening a sector struggling to shake off the financial crisis and sagging political momentum on climate change.

Soaring fossil fuel prices, where the European oil benchmark is pushing $100 a barrel, favor oil and coal producers, while falling gas prices have undermined wind power generation especially in the United States.

And the financial crisis has hit capital-intensive renewable energy projects, trimming demand for wind turbines, while the near-term solar future is clouded by cuts in European subsidies.

In all, that contributed to a dire 2010 in green equity markets, where the climate change theme under-performed global stocks by 10-20 percentage points, and new momentum is expected to be slow in 2011.

Project development returns were often acceptable, said analysts, but deployment hadn't met expectations two years ago.

Specialist environmental investors are hunting growth and bargains among companies in narrower sectors, such as energy efficiency, especially in emerging markets where power demand is surging, and in water.

"We've used our deep skepticism of bubble markets to avoid renewable energy or have much reduced exposure compared to our peer group or indices in particular, and have much more in energy efficiency and to a lesser extent water as well," said Ian Simm, chief executive at Impax Asset Management, an investor in environmental markets.

Impax assets rose 44 percent in the year to last September, and are now at about 2.3 billion pounds US $3.60 billion under management, out-stripping climate indices most of which fell.

Impax would remain over-weight in energy efficiency and aimed to pick up bargains in waste management as well as invest in companies which test air quality. "It's difficult to see the short-term catalysts for renewable energy stocks," Simm added.

The threat of climate change made the sector a long-term opportunity, said Alastair Bishop, a portfolio manager in BlackRock's natural resources equity team, but he agreed that renewable energy faced headwinds.

Bishop favored operators of renewable energy assets which had been over-sold, and energy efficiency companies such as Johnson Controls, whose automation equipment cuts the cost of controlling temperatures in buildings, as well as makers of LED lighting manufacturing equipment.

BlackRock's natural resources team has $2.7 billion assets under management in new energy and $5.1 billion in "world energy" — predominantly oil and gas — with cumulative returns in 2010 of -12.8 percent and +16.8 percent respectively, illustrating the relative performance of the two asset classes.

Impax's Simm rejected the notion that conventional and alternative energy were in competition for investor cash.

But contrasting fortunes for Coal India and Enel Green Power, whose shares soared and fell respectively when they listed on the same day last November, illustrated which sector had momentum.

"It tells you a lot about the market, that institutional investors including those very well informed about climate change, who join the various groups which claim to be concerned, will still put their money in what they think is a good deal," said James Cameron, vice-chairman at UK-based Climate Change Capital. "There's a massive amount of demand for coal."

Climate Change Capital had $1.5 billion funds under management as of end-2009, in carbon markets, renewable energy and efficiency.

Favoring the clean technology outlook, higher oil and coal prices will drive efficiency and make renewables more competitive, while economic recovery packages will disburse cash at an increasing rate in energy efficiency this year, said HSBC.

Emerging markets are a particular focus, as developing countries struggle to meet power demand. Impax has increased its asset allocation in the Asia-Pacific region to 20 percent from about 13 percent two years ago, said Simm.

"Global momentum behind renewable equipment, both solar and wind, has now firmly shifted to China from Europe," said Citigroup analysts in a research note published this week.

Green investing doldrums follow a broader loss of political and media climate focus in the wake of the financial crisis and after a Copenhagen summit in 2009 failed to agree a global deal to cut carbon emissions.

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America’s Electricity is Safe From the Coronavirus—for Now

US Grid Pandemic Response coordinates control rooms, grid operators, and critical infrastructure, leveraging hydroelectric plants, backup control centers, mutual assistance networks, and deep cleaning protocols to maintain reliability amid reduced demand and COVID-19 risks.

 

Key Points

US Grid Pandemic Response encompasses measures by utilities and operators to safeguard power reliability during COVID-19

✅ Control rooms staffed on-site; operators split across backup centers

✅ Health screenings, deep cleaning, and isolation protocols mitigate contagion

✅ Reduced demand and mutual assistance improve grid resilience

 

Control rooms are the brains of NYPA’s power plants, which are mostly hydroelectric and supply about a quarter of all the electricity in New York state. They’re also a bit like human petri dishes. The control rooms are small, covered with frequently touched switches and surfaces, and occupied for hours on end by a half-dozen employees. Since social distancing and telecommuting isn’t an option in this context, NYPA has instituted regular health screenings and deep cleanings to keep the coronavirus out.

The problem is that each power plant relies on only a handful of control room operators. Since they have a specialized skill set, they can’t be easily replaced if they get sick. “They are very, very critical,” says Gil Quiniones, NYPA president and CEO. If the pandemic worsens, Quiniones says that NYPA may require control room operators to live on-site at power plants to reduce the chance of the virus making it in from the outside world. It sounds drastic, but Quiniones says NYPA has done it before during emergencies—once during the massive 2003 blackout, and again during Hurricane Sandy.

Meanwhile, PJM is one of North America’s nine regional grid operators and manages the transmission lines that move electricity from power plants to millions of customers in 13 states on the Eastern seaboard, including Washington, DC. PJM has had a pandemic response plan on the books for 15 years, but Mike Bryson, senior vice president of operations, says that this is the first time it’s gone into full effect. As of last week, about 80 percent of PJM’s 750 full-time employees have been working from home. But PJM also requires a skeleton crew of essential workers to be on-site at all times in its control centers. As part of its emergency planning, PJM built a backup control center years ago, and now it is splitting control center operators between the two to limit contact.

Past experience with large-scale disasters has helped the energy sector keep the lights on and ventilators running during the pandemic. Energy is one of 16 sectors that the US government has designated as “critical infrastructure,” which also includes the communications industry, transportation sector, and food and water systems. Each is seen as vital to the country and therefore has a duty to maintain operations during national emergencies.

“We need to be treated as first responders,” says Scott Aaronson, the vice president of security and preparedness at the Edison Electric Institute, a trade group representing private utilities. “Everybody's goal right now is to keep the public healthy, and to keep society functioning as best we can. A lack of electricity will certainly create a challenge for those goals.”

America’s electricity grid is a patchwork of regional grid operators connecting private and state-owned utilities. This means simply figuring out who’s in charge and coordinating among the various organizations is one of the biggest challenges to keeping the electricity flowing during a national emergency, according to Aaronson.

Generally, a lot of this responsibility falls on formal energy organizations like the nonprofit North American Electric Reliability Corporation and the Federal Energy Regulatory Commission. But during the coronavirus outbreak, an obscure organization run by the CEOs of electric utilities called the Electricity Subsector Coordinating Council has also served as a primary liaison between the federal government and the thousands of utility companies around the US. Aaronson says the organization has been meeting twice a week for the past three weeks to ensure that utilities are implementing best practices in their response to the coronavirus, as well as to inform the government of material needs to keep the energy sector running smoothly.

This tight-knit coordination will be especially important if the pandemic gets worse, as many forecasts suggest it will. Most utilities belong to at least one mutual assistance group, an informal network of electricity suppliers that help each other out during a catastrophe. These mutual assistance networks are usually called upon following major storms that threaten prolonged outages. But they could, in principle, be used to help during the coronavirus pandemic too. For example, if a utility finds itself without enough operators to manage a power plant, it could conceivably borrow trained operators from another company to make sure the power plant stays online.

So far, utilities and grid operators have managed to make it work on their own. There have been a handful of coronavirus cases reported at power plants, but they haven’t yet affected these plants’ ability to deliver energy. The challenges of running a power plant with a skeleton crew is partially offset by the reduced power demand as businesses shut down and more people work from home, says Robert Hebner, the director of the Center for Electromechanics at the University of Texas. “The reduced demand for power gives utilities a little breathing room,” says Hebner.

A recent study by the University of Chicago’s Energy Policy Institute found that electricity demand in Italy has plunged by 18 percent following the severe increase in coronavirus cases in the country. Energy demand in China also plummeted as a result of the pandemic. Bryson, at PJM, says the grid operator has seen about a 6 percent decrease in electricity demand in recent weeks, but expects an even greater drop if the pandemic gets worse.

Generally speaking, problems delivering electricity in the US occur when the grid is overloaded or physically damaged, such as during California wildfires or a hurricane.

An open question among coronavirus researchers is whether there will be a second wave of the pandemic later this year. During the Spanish flu pandemic in the early 20th century, the second wave turned out to be deadlier than the first. If the coronavirus remerges later this year, it could be a serious threat to reliable electricity in the US, says John MacWilliams, a former associate deputy secretary of the Department of Energy and a senior fellow at Columbia University’s Center on Global Energy Policy.

“If this crisis extends into the fall, we're going to hit hurricane season along the coasts,” MacWilliams says. “Utilities are doing a very good job right now, but if we get unlucky and have an active hurricane season, they're going to get very stressed because the number of workers that are available to repair damage and restore power will become more limited.”

This was a sentiment echoed by Bryson at PJM. “Any one disaster is manageable, but when you start layering them on top of each other, it gets much more challenging,” he adds. The US electricity grid struggles to handle major storms as it is, and these challenges will be heightened if too many workers are home sick. In this sense, the energy sector’s ability to deliver the electricity needed to keep manufacturing medical supplies or keep ventilators running depends to a large extent on our ability to flatten the curve today. The coronavirus is bad enough without having to worry about the lights going out.

 

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Iran eyes transmitting electricity to Europe as region’s power hub

Iran Electricity Grid Synchronization enables regional interconnection, cross-border transmission, and Caspian-Europe energy corridors, linking Iraq, Azerbaijan, Russia, and Qatar to West Asia and European markets with reliable, flexible power exchange.

 

Key Points

Iran's initiative to link West Asian and European power grids for trade, transit, reliability, and regional influence.

✅ Synchronizes grids with Iraq, Azerbaijan, Russia, and potential Qatar link

✅ Enables east-to-Europe electricity transit via Caspian energy corridors

✅ Backed by gas-fueled and combined-cycle generation capacity

 

Following a plan for becoming West Asia’s electricity hub, Iran has been taking serious steps for joining its electricity network with neighbors in the past few years.

The Iranian Energy Ministry has been negotiating with the neighboring countries including Iraq for the connection of their power networks with Iran, discussing Iran-Iraq energy cooperation as well as ties with Russia, Afghanistan, Azerbaijan, and Qatar to make them enable to import or transmit their electricity to new destination markets through Iran.

The synchronization of power grids with the neighboring countries, not only enhances Iran’s electricity exchanges with them, but it will also increase the political stance of the country in the region.

So far, Iran’s electricity network has been synchronized with Iraq, where Iran is supplying 40% of Iraq's power today, and back in September, the Energy Minister Reza Ardakanian announced that the electricity networks of Russia and Azerbaijan are the next in line for becoming linked with the Iranian grid in the coming months.

“Within the next few months, the study project of synchronization of the electricity networks of Iran, Azerbaijan, and Russia will be completed and then the executive operations will begin,” the minister said.

Meanwhile, Ardakanian and Qatari Minister of State for Energy Affairs Saad Sherida Al-Kaabi held an online meeting in late September to discuss joining the two countries' electricity networks via sea.

During the online meeting, Al-Kaabi said: "Electricity transfer between the two countries is possible and this proposal should be worked on.”

Now, taking a new step toward becoming the region’s power hub, Iran has suggested becoming a bridge between East and Europe for transmitting electricity.

In a virtual conference dubbed 1st Caspian Europe Forum hosted by Berlin on Thursday, the Iranian energy minister has expressed the country’s readiness for joining its electricity network with Europe.

"We are ready to connect Iran's electricity network, as the largest power generation power in West Asia, with the European countries and to provide the ground for the exchange of electricity with Europe," Ardakanian said addressing the online event.

Iran's energy infrastructure in the oil, gas, and electricity sectors can be used as good platforms for the transfer of energy from east to Europe, he noted.

In the event, which was aimed to study issues related to the development of economic cooperation, especially energy, between the countries of the Caspian Sea region, the official added that Iran, with its huge energy resources and having skilled manpower and advanced facilities in the field of energy, can pave the ground for the prosperity of international transport and energy corridors.

"In order to help promote communication between our landlocked neighbors with international markets, as Uzbekistan aims to export power to Afghanistan across the region, we have created a huge transit infrastructure in our country and have demonstrated in practice our commitment to regional development and peace and stability," Ardakanian said.

He pointed out that having a major percentage of proven oil and gas resources in the world, regional states need to strengthen relations in a bid to regulate production and export policies of these huge resources and potentially play a role in determining the price and supply of these resources worldwide.

“EU countries can join our regional cooperation in the framework of bilateral or multilateral mechanisms such as ECO,” he said.

Given the growing regional and global energy needs and the insufficient investment in the field, with parts of Central Asia facing severe electricity shortages today, as well as Europe's increasing needs, this area can become a sustainable area of cooperation, he noted.

Ardakanian also said that by investing in energy production in Iran, Europe can meet part of its future energy needs on a sustainable basis.

In Iraq, plans for nuclear power plants are being pursued to tackle chronic electricity shortages, reflecting parallel efforts to diversify generation.

Iran currently has electricity exchange with Armenia, Azerbaijan, Iraq, where grid rehabilitation deals have been finalized, Turkmenistan, and Afghanistan.

The country’s total electricity exports vary depending on the hot and cold seasons of the year, since during the hot season which is the peak consumption period, the country’s electricity exports decreases, however electrical communication with neighboring countries continues.

Enjoying abundant gas resources, which is the main fuel for the majority of the country’s power plants, Iran has the capacity to produce about 85,500 megawatts [85.5 gigawatts (GW)] of electricity.

Currently, combined cycle power plants account for the biggest share in the country’s total power generation capacity as Iran is turning thermal plants to combined cycle to save energy, followed by gas power plants.

 

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Two new BC generating stations officially commissioned

BC Hydro Site C and Clean Energy Policy shapes B.C.'s power mix, affecting run-of-river hydro, net metering for rooftop solar, independent power producers, and surplus capacity forecasts tied to LNG Canada demand.

 

Key Points

BC Hydro's strategy centers on Site C, limiting new run-of-river projects and tightening net metering amid surplus power

✅ Site C adds long-term capacity with lower projected rates.

✅ Run-of-river IPP growth paused amid surplus forecasts.

✅ Net metering limits deter oversized rooftop solar.

 

Innergex Renewable Energy Inc. is celebrating the official commissioning today of what may be the last large run-of-river hydro project in B.C. for years to come.

The project – two new generating stations on the Upper Lillooet River and Boulder Creek in the Pemberton Valley – actually began producing power in 2017, but the official commissioning was delayed until Friday September 14.

Innergex, which earlier this year bought out Vancouver’s Alterra Power, invested $491 million in the two run-of-river hydro-electric projects, which have a generating capacity of 106 megawatts of power. The project has the generating capacity to power 39,000 homes.

The commissioning happened to coincide with an address by BC Hydro CEO Chris O’Riley to the Greater Vancouver Board of Trade Friday, in which he provided an update on the progress of the $10.7-billion Site C dam project.

That project has put an end, for the foreseeable future, of any major new run-of-river projects like the Innergex project in Pemberton.

BC Hydro expects the new dam to produce a surplus of power when it is commissioned in November 2024, so no new clean energy power calls are expected for years to come.

Independent power producers aren’t the only ones who have seen a decline in opportunities to make money in B.C. providing renewable power, as the Siwash Creek project shows. So will homeowners who over-build their own solar power systems, in an attempt to make money from power sales.

There are about 1,300 homeowners in B.C. with rooftop solar systems, and when they produce surplus power, they can sell it to BC Hydro.

BC Hydro is amending the net metering program to discourage homeowners from over-building. In some cases, some howeowners have been generating 40% to 50% more power than they need.

“We were getting installations that were massively over-sized for their load, and selling this big quantity of power to us,” O’Riley said. “And that was never the idea of the program.”

Going forward, BC Hydro plans to place limits on how much power a homeowner can sell to BC Hydro.

BC Hydro has been criticized for building Site C when the demand for power has been generally flat, and reliance on out-of-province electricity has drawn scrutiny. But O’Riley said the dam isn’t being built for today’s generation, but the next.

“We’re not building Site C for today,” he said. “We have an energy surplus for the short term. We’re not even building it for 2024. We’re building it for the next 100 years.”

O’Riley acknowledged Site C dam has been a contentious and “extremely challenging” project. It has faced numerous court challenges, a late-stage review by the BC Utilities Commission, cost overruns, geotechnical problems and a dispute with the main contractors.

In a separate case, the province was ordered to pay $10 million over the denial of a Squamish power project, highlighting broader legal risk.

But those issues have been resolved, O’Riley said, and the project is back on track with a new construction schedule.

“As we move forward, we have a responsibility to deliver a project on time and against the new revised budget, and I’m confident the changes we’ve made are set up to do that,” O’Riley said.

Currently, there are about 3,300 workers employed on the dam project.

Despite criticisms that BC Hydro is investing in a legacy mega-project at a time when cost of wind and solar have been falling, O’Riley insisted that Site C was the best and lowest cost option.

“First, it’s the lowest cost option,” he said. “We expect over the first 20 years of Site C’s operating life, our customers will see rates 7% to 10% below what it would otherwise be using the alternatives.”

BC Hydro missed a critical window to divert the Peace River, something that can only be done in September, during lower river flows. That added a full year’s delay to the project.

O’Riley said BC Hydro had built in a one-year contingency into the project, so he expects the project can still be completed by 2024 – the original in-service target date. But the delay will add more than $2 billion to the last budget estimate, boosting the estimated capital cost from $8.3 billion to $10.7 billion.

Meeting the 2024 in-service target date could be important, if Royal Dutch Shell and its consortium partners make a final investment decision this year on the $40 billion LNG Canada project.

That project also has a completion target date of 2024, and would be a major new industrial customer with a substantial power draw for operations.

“If they make a decision to go forward, they will be a very big customer of BC Hydro,” O’Riley told Business in Vancouver. “They would be in our top three or four biggest customers.”

 

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Poland’s largest power group opts to back wind over nuclear

Poland Offshore Wind Energy accelerates as PGE exits nuclear leadership, PKN Orlen steps in, and Baltic Sea projects expand to cut coal reliance, meet EU emissions goals, attract investors, and bridge the power capacity gap.

 

Key Points

A shift from coal and nuclear to Baltic offshore wind to add capacity, cut EU emissions, and attract investment.

✅ PGE drops lead in nuclear; pivots $10bn to offshore wind.

✅ PKN Orlen may assume nuclear role; projects await approval.

✅ 6 GW offshore could add 60b zlotys and 77k jobs by 2030.

 

PGE, Poland’s biggest power group has decided to abandon a role in building the country’s first nuclear power plant and will instead focus investment on offshore wind energy.

Reuters reports state-run refiner PKN Orlen (PKN.WA) could take on PGE’s role, while the latter announces a $10bn offshore wind power project.

Both moves into renewables and nuclear represent a major change in Polish energy policy, diversifying away from the country’s traditional coal-fired power base, as regional efforts like the North Sea wind farms initiative expand, in a bid to fill an electricity shortfall and meet EU emission standards.

An unnamed source told the news agency, PGE could not fund both projects and cheap technology had swung the decision in favour of wind, with offshore wind competing with gas in some markets. PGE could still play a smaller role in the nuclear project which has been delayed and still needs government approval.

#google#

A proposed law is currently before the Polish parliament aiming at facilitating easy construction of wind turbines, mindful of Germany’s grid expansion challenges that have hindered rollout.

If the law is passed, as expected, several other wind farm projects could also proceed.

Polenergia has said it would like to build a wind farm in the Baltic by 2022. PKN Orlen is also considering building one.

PGE said in March that it wants to build offshore windfarms with a capacity of 2.5 gigawatts (GW) by 2030.

Analysts and investors say that offshore wind farms are the easiest and fastest way for Poland to fill the expected capacity gap from coal, with examples like the largest UK offshore wind farm coming online underscoring momentum, and reduce CO2 emissions in line with EU’s 2030 targets as Poland seeks improved ties with Brussels.

The decision to open up the offshore power industry could also draw in investors, as shown by Japanese utilities’ UK offshore investment attracting cross-border capital. Statoil said in April it would join Polenergia’s offshore project which has drawn interest from other international wind companies. “

The Polish Wind Energy Association (PWEA) estimates that offshore windfarms with a total capacity of 6 GW would help create around 77,000 new jobs and add around 60 billion zlotys to economic growth.

 

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Oil crash only a foretaste of what awaits energy industry

Oil and Gas Profitability Decline reflects shale-driven oversupply, OPEC-Russia dynamics, LNG exports, renewables growth, and weak demand, signaling compressed margins for producers, stressed petrodollar budgets, and shifting energy markets post-Covid.

 

Key Points

A sustained squeeze on hydrocarbon margins from agile shale supply, weaker OPEC leverage, and expanding renewables.

✅ Shale responsiveness caps prices and erodes industry rents

✅ OPEC-Russia cuts face limited impact versus US supply

✅ Renewables and EVs slow long-term oil and gas demand

 

The oil-price crash of March 2020 will probably not last long. As in 2014, when the oil price dropped below $50 from $110 in a few weeks, this one will trigger a temporary collapse of the US shale industry. Unless the coronavirus outbreak causes Armageddon, cheap oil will also support policymakers’ efforts to help the global economy.

But there will be at least one important and lasting difference this time round — and it has major market and geopolitical implications.

The oil price crash is a foretaste of where the whole energy sector was going anyway — and that is down.

It may not look that way at first. Saudi Arabia will soon realise, as it did in 2015, that its lethal decision to pump more oil is not only killing US shale but its public finances as well. Riyadh will soon knock on Moscow’s door again. Once American shale supplies collapse, Russia will resume co-operation with Saudi Arabia.

With the world economy recovering from the Covid-19 crisis by then, and with electricity demand during COVID-19 shifting, moderate supply cuts by both countries will accelerate oil market recovery. In time, US shale producers will return too.

Yet this inevitable bounceback should not distract from two fundamental factors that were already remaking oil and gas markets. First, the shale revolution has fundamentally eroded industry profitability. Second, the renewables’ revolution will continue to depress growth in demand.

The combined result has put the profitability of the entire global hydrocarbon industry under pressure. That means fewer petrodollars to support oil-producing countries’ national budgets, including Canada's oil sector exposures. It also means less profitable oil companies, which traditionally make up a large segment of stock markets, an important component of so many western pension funds.

Start with the first factor to see why this is so. Historically, the geological advantages that made oil from countries such as Saudi Arabia so cheap to produce were unique. Because oil and gas were produced at costs far below the market price, the excess profits, or “rent”, enjoyed by the industry were very large.

Furthermore, collusion among low-cost producers has been a winning strategy. The loss of market share through output cuts was more than compensated by immediately higher prices. It was the raison d’être of Opec.

The US shale revolution changed all this, exposing the limits of U.S. energy dominance narratives. A large oil-producing region emerged with a remarkable ability to respond quickly to price changes and shrink its costs over time. Cutting back cheap Opec oil now only increases US supplies, with little effect on world prices.

That is why Russia refused to cut production this month. Even if its cuts did boost world prices — doubtful given the coronavirus outbreak’s huge shock to demand — that would slow the shrinkage of US shale that Moscow wants.

Shale has affected the natural gas industry even more. Exports of US liquefied natural gas now put an effective ceiling on global prices, and debates over a clean electricity push have intensified when gas prices spike.

On top of all this, there is also the renewables’ revolution, though a green revolution has not been guaranteed in the near term. Around the world, wind and solar have become ever-cheaper options to generate electricity. Storage costs have also dropped and network management improved. Even in the US, renewables are displacing coal and gas. Electrification of vehicle fleets will damp demand further, as U.S. electricity, gas, and EVs face evolving pressures.

Eliminating fossil fuel consumption completely would require sustained and costly government intervention, and reliability challenges such as coal and nuclear disruptions add to the complexity. That is far from certain. Meanwhile, though, market forces are depressing the sector’s usual profitability.

The end of oil and gas is not immediately around the corner. Still, the end of hydrocarbons as a lucrative industry is a distinct possibility. We are seeing that in dramatic form in the current oil price crash. But this collapse is merely a message from the future.

 

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Atlantica - Regulatory Reform To Bring Greener Power To Atlantic Canada

Atlantic Canada Energy Regulatory Reform accelerates smart grids, renewables, hydrogen, and small modular reactors to meet climate targets, enabling interprovincial transmission, EV charging, and decarbonization toward a net-zero grid by 2035 with agile, collaborative policies.

 

Key Points

A policy shift enabling smart grids, clean energy, and transmission upgrades to decarbonize Atlantic Canada by 2035.

✅ Agile rules for smart grids, EV load, and peak demand balancing

✅ Interprovincial transmission: Maritime Link, NB-PEI, Atlantic Loop

✅ Supports hydrogen, SMRs, and renewables to cut GHG emissions

 

Atlantica Centre for Energy Senior Policy Consultant Neil Jacobsen says the future of Atlantic Canada’s electricity grid depends on agile regulations, supported by targeted research such as the $2M Atlantic grid study, that match the pace at which renewable technologies are being developed in the race to meet Canada’s climate goals.

In an interview, Jacobsen stressed the need for a more modernized energy regulatory framework, so the Atlantic Provinces can collaborate to quickly develop and adopt cleaner energy.

To this end, Atlantica released a paper that makes the case for responsive smart grid technology, the adaptation of alternative forms of clean energy, the adaptation of hydrogen as an energy source, petroleum price regulation in Atlantic Canada and small modular reactors.

Jacobsen said regulations need to match Canada’s urgency around reducing greenhouse gas emissions by 40 to 45 percent by 2030, achieving a net-neutral national power grid by 2035 and ultimately a net-zero grid by 2050 in Canada – and the goal that 50 percent of Canadian vehicle sales being electric by 2030.

“It’s an evolution of policy and regulations to adapt to a very aggressive timeline of aggressive climate change and decarbonization targets,” said Jacobsen.

“These are transformational energy and environmental commitments, so the path forward really requires the ability to introduce and adapt and move forward with new clean renewable energy technologies.”

Jacobsen said Atlantica’s recommendations are not a criticism of existing regulations– but an acknowledgment that they need to evolve.

He noted newer, clearer regulations will make way for new energy sources – particularly a region that has the countries highest rates of dependency on fossil fuels and growing climate risks, with Atlantic grids under threat from more intense storms.

“We have a long way to go, but at the same time, we have a lot to celebrate. Atlantic Canada is leading the country in reducing greenhouse gas emissions,” said Jacobsen.

“There are new ways of producing energy that requires us to be able to be much more responsive and this is an opportunity to create a higher level of alignment here, in Atlantic Canada.”

Jacobsen said Atlantica is looking to aid interprovincial cooperation in providing power, echoing calls for a western Canadian grid elsewhere, through projects like the 500-megawatt, 170-kilometre Maritime Link that transports power from the Muskrat Falls hydroelectric dam in Labrador, through Newfoundland and across the Cabot Strait, to Nova Scotia – or NB Power’s export of electricity to P.E.I., via sub-sea cables crossing the Northumberland Strait.

He noted streamlined regulations may allow for more potential wider-scale partnerships, like the proposed Atlantic Loop project, aligning with macrogrid investments that would involve upgrading transmission capacity on the East Coast to allow hydroelectric power from Labrador and Quebec to displace coal use in the region.

Atlantic Canada has led the way with adaption new renewable technologies, noted Jacobsen, referring to nuclear startups Moltex Energy and ARC Nuclear Canada’s efforts to develop small modular nuclear reactor technology in New Brunswick, as well as the potential of adopting hydrogen fuel technology and Nova Scotia’s strides in developing offshore renewable energy.

“I don’t think we have any choice other than to be forceful and aggressive in driving forward a renewable energy agenda.”

Jacobsen said cooperation between the Atlantic provinces is crucial because of how challenging it is to meet energy demand with heavy seasonal and daily variations in energy demand in the region – something smart grid technology could address.

Smart Grid Atlantic is a four-year research and demonstration program testing technologies that provide cleaner local power, support a smarter electricity infrastructure across the region, more renewable power, more information and control over power use and more reliable electricity.

“It can be challenging for utilities to meet those cyclical demands, especially as grids are increasingly exposed to harsh weather across Canada. Smart girds add knowledge of the flow of electrons in a way that can help even out those electricity demands – and quite frankly, those demands will only increase when you look at the electrification of the transportation sector,” he said.

Jacobsen said Atlantica’s paper and call for modernized regulations are only the beginning of a conversation.

 

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