Problems plague Canada's emissions trading plans

By Reuters


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Just as Canada is set to launch a domestic carbon emissions trading scheme in a bid to curb its rising greenhouse gas emissions, a number of issues have surfaced, casting doubt on the country's plans.

Some Canadian provinces have introduced provincial carbon taxes or have opted to join a prospective U.S.-based trading scheme, and threaten to throw Canada's federal emissions trading plans into disarray, Judith Hull, director of trading regimes for Environment Canada, told a carbon markets conference in Germany.

"We're going to have a real challenge meshing the federal system with provincial actions," Hull said.

The provinces of British Columbia, Manitoba and Quebec join seven U.S. states in the Western Climate Initiative, a regional cap-and-trade scheme launched as a result of a lack of legislative progress made on fighting climate change by the respective federal governments.

Cap-and-trade involves setting a cap on industrial emissions, then distributing carbon credits to the participants. If they pollute above their carbon quota, participants must then determine whether it's cheaper to buy credits in the open market or to invest in cutting their own emissions.

The Canadian government, echoing the European Union's own $50 billion emissions trading scheme, wants to include all heavy industry in the program, which accounts for half of Canada's total carbon emissions.

Canada ratified the United Nations' Kyoto Protocol under the Liberal government, which ruled from Canada from 1993 to 2006.

The Kyoto Protocol aims to cut 1990 greenhouse gas emissions by an average of 5 percent between 2008 and 2012.

Last year, Conservative Prime Minister Stephen Harper said Canada has no chance of meeting commitments under the Protocol, which called for the country to trim emissions by 6 percent.

One reason for this is the growing emissions coming from oil-rich Alberta's energy sector.

"Right now, Canada is 25 percent above its target... and if we remain on a business-as-usual trajection, we're going to be a further 24 percent above (by 2012)," Hull said.

'Turning the Corner', a plan released by the Canadian government in April 2007, set intensity-based targets of a 20 percent reduction on 2006 levels by 2020.

Intensity-based targets mean emissions cuts are measured against units of economic output rather than in absolute terms, so a rapid rise in economic activity could lead to an absolute increase in emissions.

"So we're going to have a cap-and-trade system on a provincial level and an emissions-intensity system on a federal level... We've got to make these systems work together," Hull added.

The federal government is also setting up a technology fund, selling carbon credits to industry and investing the proceeds in clean energy research and development.

The fund will be priced at $15 per ton of CO2, essentially placing a price ceiling on credits. Prices will eventually rise to $20 a ton, and then will be indexed to economic output as well, Hull said.

Companies can access the fund for up to 70 percent of their initial credit requirements, though this number will decrease with time.

Canada's trading scheme will include trade in four different types of carbon credits, Hull said.

Along with the normal surplus credits, some 15 million early-action credits will be awarded to companies that have cut emissions significantly before the start of the trading in 2010.

Voluntary offset credits certified by the International Organization for Standardization (ISO) will also be traded, as well as U.N.-approved credits (CERs), which are issued under Kyoto's Clean Development Mechanism (CDM).

Under the CDM, companies and governments from rich nations can invest in clean energy projects in developing countries, earning CERs in return. These credits can then be sold for profit or used to meet emissions goals under Kyoto.

Prime Minister Harper discounted the idea of using CERs to meet the country's goal, effectively closing the country off to the $13 billion market.

Under the new proposal, Canadian companies can meet up to 10 percent of their compliance gap through imported CERs.

Traders welcomed the move, but noted the issues still plaguing the country's proposed emissions trading framework.

"Canada's plan is called Turning the Corner, but it seems to me there are a number of other corners following this one," one London-based emissions trader told Reuters at the conference.

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UK peak power prices rise to second highest level since 2018

UK Peak Power Prices surged as low wind speeds forced National Grid to rely on gas-fired plants and coal generation, amid soaring wholesale gas prices and weak wind generation during the energy crisis.

 

Key Points

UK Peak Power Prices are electricity costs at peak hours, driven by wind output, gas reliance, and market dynamics.

✅ Spikes when wind generation drops and demand rises.

✅ Driven by gas-fired plants, coal backup, and wholesale gas prices.

✅ Moderate as wind output recovers and interconnectors supply.

 

Low wind speeds pushed peak hour power prices to the second highest level for at least three years on Monday, a move consistent with UK electricity prices hitting a 10-year high earlier this year, as Britain’s grid was forced to increase its reliance on gas-fired power plants and draw on coal generation.

Calm weather this year has exacerbated the energy price crisis in the UK, as gas-fired power stations have had to pick up the slack from wind farms. Energy demand has surged as countries open up from pandemic restrictions, which together with lower supplies from Russia to western Europe, has sent wholesale gas prices soaring.

Power prices in the UK for the peak evening period between 5pm and 6pm on Monday surpassed £2,000 per megawatt hour, only the second time they have exceeded that level in recent years.

This was still below the levels reached at the height of the gas price crisis in mid-September, when they hit £2,500/MWh, according to the energy consultancy Cornwall Insight, whose records date back to 2018.

Low wind speeds were the main driver behind Monday’s price spike, although expectations of a pick-up in wind generation on Tuesday, after recent record wind generation days, should push them back down to similar levels seen in recent weeks, analysts said.

Despite the expansion of renewables, such as wind and solar, over the past decade, with instances of wind leading the power mix in recent months, gas remains the single biggest source of electricity generation in Britain, typically accounting for nearly 40 per cent of output.

At lunchtime on Monday, gas-fired power plants were producing nearly 55 per cent of electricity, while coal accounted for 3 per cent, reflecting more power from wind than coal in 2016 milestones. Britain’s wind farms were contributing 1.67 gigawatts or just over 4 per cent, according to data from the Drax Electrics Insights website. Over the past 12 months, wind farms have produced 21 per cent of the UK’s electricity on average.

National Grid, which manages the UK’s electricity grid, has been forced on a number of occasions in recent months to ask coal plants to fire up to help offset the loss of wind generation, after issuing a National Grid short supply warning to the market. The government announced in June that it planned to bring forward the closure of the remaining coal stations to the end of September 2024.

Ministers also committed this year to making Britain’s electricity grid “net zero carbon” by 2035, and milestones such as when wind was the main source underline the transition, although some analysts have pointed out that would not signal the end of gas generation.

Since the start of the energy crisis in August, 20 energy suppliers have gone bust as they have struggled to secure the electricity and gas needed to supply customers at record wholesale prices, with further failures expected in coming weeks.

Phil Hewitt, director of the consultancy EnAppSys, said Monday’s high prices would further exacerbate pressures on those energy suppliers that do not have adequate hedging strategies. “This winter is a good time to be a generator,” he added.

Energy companies including Orsted of Denmark and SSE of the UK have reported some of the lowest wind speeds for at least two decades this year, even though record output during Storm Malik highlighted the system's volatility.

According to weather modelling group Vortex, the strength of the wind blowing across northern Europe has fallen by as much as 15 per cent on average in places this year, which some scientists suggest could be due to climate change.
 

 

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Florida Court Blocks Push to Break Electricity Monopolies

Florida Electricity Deregulation Ruling highlights the Florida Supreme Court decision blocking a ballot measure on retail choice, preserving utility monopolies for NextEra and Duke Energy, while similar deregulation efforts arise in Virginia and Arizona.

 

Key Points

A high court decision removing a retail choice ballot measure, keeping Florida utility monopolies intact for incumbents.

✅ Petition language deemed misleading for 2020 ballot

✅ Preserves NextEra and Duke Energy market dominance

✅ Similar retail choice pushes in VA and AZ

 

Florida’s top court ruled against a proposed constitutional amendment that would have allowed customers to pick their electricity provider, even as Florida solar incentives face rejection by state leaders, threatening monopolies held by utilities such as NextEra Energy Inc. and Duke Energy Corp.

In a ruling Thursday, the court said the petition’s language is “misleading” and doesn’t comply with requirements to be included on the 2020 ballot, reflecting debates over electricity pricing changes at the federal level. The measure’s sponsor, Citizens for Energy Choice, said the move ends the initiative, even as electricity future advocacy continues nationwide.

“While we were confident in our plan to gather the remaining signatures required, we cannot overcome this last obstacle,” the group’s chair, Alex Patton, noting ongoing energy freedom in the South efforts, said in a statement.

The proposed measure was one of several efforts underway to deregulate U.S. electricity markets, including New York’s review of retail energy markets this year. Earlier this week, two Virginia state lawmakers unveiled a bill to allow residents and businesses to pick their electricity provider, threatening Dominion Energy Inc.’s longstanding local monopoly. And in Arizona, where Arizona Public Service Co. has long reigned, regulators are considering a similar move, while in New England Hydro-Quebec’s export bid has been energized by a court decision.

 

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Leading Offshore Wind Conference to Launch National Job Fair

OSW CareerMatch Offshore Wind Job Fair convenes industry leaders, supply chain employers, and skilled candidates at IPF 2020 in Providence, Rhode Island, spotlighting workforce development, training programs, and near-term hiring for U.S. offshore wind projects.

 

Key Points

An IPF 2020 job fair connecting offshore wind employers, advancing workforce development in Providence, RI.

✅ National job fair at IPF 2020, Providence, RI

✅ Connects supply chain employers with skilled candidates

✅ Includes a workforce development and education summit

 

The Business Network for Offshore Wind, the leading non-profit advocate for U.S. offshore wind at the state, federal and global levels, amid a U.S. grid warning about coronavirus impacts, will host its seventh annual International Partnership Forum (IPF) on April 21-24, 2020 in Providence, Rhode Island. 

New this year: the first-ever national offshore wind industry job fair plus a half-day workforce development summit, in partnership with Skills for Rhode Island’s Future. The OSW CareerMatch, will showcase jobs at top-tier companies seeking to grow the workforce of the future, informed by young people's interest in electricity careers, and recruit qualified candidates. The Offshore Wind Workforce Development and Education Summit, an invitation-only event, will bring together educators, stakeholders, and industry leaders to address current energy training programs, identify industry employment needs, required skillsets, and how organizations can fulfill these near-term needs. CareerMatch will take place 8:30 a.m. to 1:00 p.m. on Tuesday, April 21, and the Workforce Summit from 12:30 p.m. to 4:00 p.m., both at the Rhode Island Convention Center. 

“The U.S. offshore wind industry has reached the stage that, in order to successfully develop and meet new project demands, will require an available and qualified workforce,” said Liz Burdock, CEO and president of the Business Network for Offshore Wind, noting worker safety concerns in other energy sectors. “This first-ever national Job Fair will allow top-tier supply chain companies to connect with skilled individuals to discuss projects that are going on as they speak.” 

“Hosting the first-of-its-kind offshore wind energy job fair in The Ocean State is apropos,” said Nina Pande, executive director of Skills for Rhode Island’s Future, as future of work investments accelerate across the electricity sector. “Our organization is thrilled to have the unique opportunity to help convene talent at OSW CareerMatch to engage with the employers across the offshore wind supply chain.”

The annual IPF conference is the premier event for the offshore wind supply chain, which is now projected to be a $70 billion revenue opportunity through 2030. Fully developing this supply chain will foster local economic growth, provide thousands of jobs, adapt to shifts like working from home electricity demand, and help offshore wind energy meet its potential. If fully built out worldwide, offshore wind could power 18 times the world’s current electricity needs.    

The exhibit and conference sells out every year and is again on track to draw over 2,500 industry professionals representing over 575 companies, all focused on sharing valuable insights on how to move the emerging U.S. wind industry forward, including operational resilience such as on-site staffing plans during the outbreak. The full conference schedule may be seen online here. More details, including special guest speakers, will be announced soon.
 

 

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Energy experts: US electric grid not designed to withstand the impacts of climate change

Summer Power Grid Reliability and Climate Risk drives urgent planning as extreme heat, peak demand, drought, and aging infrastructure strain ERCOT, NERC regions, risking outages without renewables integration and climate-informed grid modeling.

 

Key Points

Assessment of how extreme weather and demand stress the US grid, informing climate-smart planning to reduce outages.

✅ Many operators rely on historical weather, not climate projections

✅ NERC flags elevated blackout risk amid extreme heat and drought

✅ Renewables and storage can boost capacity and cut emissions

 

As heat ramps up ahead of what forecasters say will be a hotter than normal summer, electricity experts and officials are warning that states may not have enough power to meet demand in the coming months. And many of the nation's grid operators are also not taking climate change into account in their planning, despite available grid resilience guidance that could inform upgrades, even as extreme weather becomes more frequent and more severe.

Power operators in the Central US, in their summer readiness report, have already predicted "insufficient firm resources to cover summer peak forecasts." That assessment accounted for historical weather and the latest NOAA outlook that projects for more extreme weather this summer.

But energy experts say that some power grid operators are not considering how the climate crisis is changing our weather — including more frequent extreme events — and that is a problem if the intent is to build a reliable power grid while accelerating investing in carbon-free electricity across markets.

"The reality is the electricity system is old and a lot of the infrastructure was built before we started thinking about climate change," said Romany Webb, a researcher at Columbia University's Sabin Center for Climate Change Law. "It's not designed to withstand the impacts of climate change."

Webb says many power grid operators use historical weather to make investment decisions, rather than the more dire climate projections, simply because they want to avoid the possibility of financial loss, even as climate-related credit risks for nuclear plants are being flagged, for investing in what might happen versus what has already happened. She said it's the wrong approach and it makes the grid vulnerable.

"We have seen a reluctance on the part of many utilities to factor climate change into their planning processes because they say the science around climate change is too uncertain," Webb said. "The reality is we know climate change is happening, we know the impact it has in terms of more severe heatwaves, hurricanes, drought, with recent hydropower constraints in British Columbia illustrating the risks, and we know that all of those things affect the electricity system so ignoring those impacts just makes the problems worse."

An early heatwave knocked six power plants offline in Texas earlier this month. Residents were asked to limit electricity use, keeping thermostats at 78 degrees or higher and, as extreme heat boosts electricity bills for consumers, avoid using large appliances at peak times. The Electric Reliability Council of Texas, or ERCOT, in its seasonal reliability report, said the state's power grid is prepared for the summer and has "sufficient" power for "normal" summer conditions, based on average weather from 2006 to 2020.

But NOAA's recently released summer outlook forecasts above average temperatures for every county in the nation.

"We are continuing to design and site facilities based on historical weather patterns that we know in the age of climate change are not a good proxy for future conditions," Webb said.

When asked if the agency is creating a blind spot for itself by not accounting for extreme weather predictions, an ERCOT spokesperson said the report "uses a scenario approach to illustrate a range of resource adequacy outcomes based on extreme system conditions, including some extreme weather scenarios."

The North American Electric Reliability Corporation, or NERC — a regulating authority that oversees the health of the nation's electrical infrastructure — has a less optimistic projection.

In a recent seasonal reliability report, NERC placed Texas at "elevated risk" for blackouts this summer. It also reported that while much of the nation will have adequate electricity this summer, several markets are at risk of energy emergencies.

California grid operators, who recently avoided widespread rolling blackouts as heat strained the grid, in its summer reliability report also based its readiness analysis on "the most recent 20 years of historical weather data." The report also notes the assessment "does not fully reflect more extreme climate induced load and supply uncertainties."

Compounding the US power grid's supply and demand problem is drought: NERC says there's been a 2% loss of reliable hydropower from the nation's power-producing dams. Add to that the rapid retirement of many coal power plants — all while nearly everything from toothbrushes to cars are now electrified. Energy experts say adding more renewables into the mix will have the dual impact of cutting climate change inducing greenhouse gas emissions but also increasing the nation's power supply, aligning with efforts such as California's 100% carbon-free mandate that aim to speed the transition.
 

 

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Solar changing shape of electricity prices in Northern Europe

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Key Points

Explains how rising solar PV cuts wholesale prices, shifts negative-price hours, and strains grid flexibility.

✅ Negative pricing events surge with higher solar penetration.

✅ Afternoon price dips replace night-time wind-led lows.

✅ Grid balancing, interconnectors, and flexibility become critical.

 

The latest EU electricity market report has confirmed the affect deeper penetration of solar is having on wholesale electricity prices more broadly.

The Quarterly Report on European Electricity Markets for the final three months of last year noted the number of periods of negative electricity pricing doubled from 2019, to almost 1,600 such events, as global renewables set new records in deployment across markets.

Having experienced just three negative price events in 2019, the Netherlands recorded almost 100 last year “amid a dramatic increase in solar PV capacity,” in the nation, according to the report.

Whilst stressing the exceptional nature of the Covid-19 pandemic on power consumption patterns, the quarterly update also noted a shift in the hours during which negative electric pricing occurred in renewables poster child Germany. Previously such events were most common at night, during periods of high wind speed and low demand, but 2020 saw a switch to afternoon negative pricing. “Thus,” stated the report, “solar PV became the main driver behind prices falling into negative territory in the German market in 2020, as Germany's solar boost accelerated, and also put afternoon prices under pressure generally.”

The report also highlighted two instances of scarce electricity–in mid September and on December 9–as evidence of the problems associated with accommodating a rising proportion of intermittent clean energy capacity into the grid, and called for more joined-up cross-border power networks, amid pushback from Russian oil and gas across the continent.

Rising solar generation–along with higher gas output, year on year–also helped the Netherlands generate a net surplus of electricity last year, after being a net importer “for many years.” The EU report also noted a beneficial effect of rising solar generation capacity on Hungary‘s national electricity account, and cited a solar “boom” in that country and Poland, mirroring rapid solar PV growth in China in recent years.

With Covid-19 falls in demand helping renewables generate more of Europe's electricity (39%) than fossil fuels (36%) for the first time, as renewables surpassed fossil fuels across Europe, the market report observed the 5% of the bloc's power produced from solar closed in on the 6% accounted for by hard coal. In the final three months of the year, European solar output rose 12%, year on year, to 18 TWh and “the increase was almost single-handedly driven by Spain,” the study added.

With coal and lignite-fired power plunging 22% last year across the bloc, it is estimated the European power sector reduced its carbon footprint 14% as part of Europe's green surge although the quarterly report warned cold weather, lower wind speeds and rising gas prices in the opening months of this year are likely to see carbon emissions rebound.

There was good news on the transport front, though, with the report stating the scale of the European “electrically-charged vehicle” fleet doubled in 2020, to 2 million, with almost half a million of the new registrations arriving in the final months of the year. That meant cars with plug sockets accounted for a remarkable 17% of new purchases in Q4, twice the proportion seen in China and a slice of the pie six times bigger than such products claimed in the U.S.

 

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Key Points

Planned PSPS outages cut power in high-risk areas to prevent ignitions, protect residents, and boost wildfire resilience.

✅ PSPS triggered by forecasts, fuel moisture, and fire danger indices.

✅ Utilities coordinate alerts, timelines, and critical facility support.

✅ Paired with forest management, education, and rapid response.

 

Colorado, known for its stunning landscapes and outdoor recreation, has implemented proactive measures to reduce the risk of wildfires by strategically shutting off power in high-risk areas, similar to PG&E wildfire shutoffs implemented in California during extreme conditions. This approach, while disruptive, aims to safeguard communities, protect natural resources, and mitigate the devastating impacts of wildfires that have become increasingly prevalent in the region.

The decision to initiate power outages as a preventative measure against wildfires underscores Colorado's commitment to proactive fire management and public safety, aligning with utility disaster planning practices that strengthen grid readiness. With climate change contributing to hotter and drier conditions, the state faces heightened wildfire risks, necessitating innovative strategies to minimize ignition sources and limit fire spread.

Utility companies, in collaboration with state and local authorities, identify areas at high risk of wildfire based on factors such as weather forecasts, fuel moisture levels, and historical fire data. When conditions reach critical thresholds, planned power outages, also known as Public Safety Power Shutoffs (PSPS), are implemented to reduce the likelihood of electrical equipment sparking wildfires during periods of extreme fire danger, particularly during windstorm-driven outages that elevate ignition risks.

While power outages are a necessary precautionary measure, they can pose challenges for residents, businesses, and essential services that rely on uninterrupted electricity, as seen when a North Seattle outage affected thousands last year. To mitigate disruptions, utility companies communicate outage schedules in advance, provide updates during outages, and coordinate with emergency services to ensure the safety and well-being of affected communities.

The implementation of PSPS is part of a broader strategy to enhance wildfire resilience in Colorado. In addition to reducing ignition risks from power lines, the state invests in forest management practices, wildfire prevention education, and emergency response capabilities, including continuity planning seen in the U.S. grid COVID-19 response, to prepare for and respond to wildfires effectively.

Furthermore, Colorado's approach to wildfire prevention highlights the importance of community preparedness and collaboration, and utilities across the region adopt measures like FortisAlberta precautions to sustain critical services during emergencies. Residents are encouraged to create defensible space around their properties, develop emergency evacuation plans, and stay informed about wildfire risks and response protocols. Community engagement plays a crucial role in building resilience and fostering a collective effort to protect lives, property, and natural habitats from wildfires.

The effectiveness of Colorado's proactive measures in mitigating wildfire risks relies on a balanced approach that considers both short-term safety measures and long-term fire prevention strategies. By integrating technology, data-driven decision-making, and community partnerships, the state aims to reduce the frequency and severity of wildfires while enhancing overall resilience to wildfire impacts.

Looking ahead, Colorado continues to refine its wildfire management practices in response to evolving environmental conditions and community needs, drawing on examples of localized readiness such as PG&E winter storm preparation to inform response planning. This includes ongoing investments in fire detection and monitoring systems, research into fire behavior and prevention strategies, and collaboration with neighboring states and federal agencies to coordinate wildfire response efforts.

In conclusion, Colorado's decision to implement power outages as a preventative measure against wildfires demonstrates proactive leadership in wildfire risk reduction and public safety. By prioritizing early intervention and community engagement, the state strives to safeguard vulnerable areas, minimize the impact of wildfires, and foster resilience in the face of increasing wildfire threats. As Colorado continues to innovate and adapt its wildfire management strategies, its efforts serve as a model for other regions grappling with the challenges posed by climate change and wildfire risks.

 

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