Toronto Prepares for a Surge in Electricity Demand as City Continues to Grow

Electricity generation from solar resources in the United States reached 77 million megawatthours (MWh) in 2017, surpassing for the first time annual generation from biomass resources, which generated 64 million MWh in 2017. Among renewable sources, only hydro and wind generated more electricity in 2017, at 300 million MWh and 254 million MWh, respectively. Biomass generating capacity has remained relatively unchanged in recent years, while solar generating capacity has consistently grown.

Annual growth in solar generation often lags annual capacity additions because generating capacity tends to be added late in the year. For example, in 2016, 29% of total utility-scale solar generating capacity additions occurred in December, leaving few days for an installed project to contribute to total annual generation despite being counted in annual generating capacity additions. In 2017, December solar additions accounted for 21% of the annual total. Overall, solar technologies operate at lower annual capacity factors and experience more seasonal variation than biomass technologies.

Biomass electricity generation comes from multiple fuel sources, such as wood solids (68% of total biomass electricity generation in 2017), landfill gas (17%), municipal solid waste (11%), and other biogenic and nonbiogenic materials (4%).These shares of biomass generation have remained relatively constant in recent years.

Solar can be divided into three types: solar thermal, which converts sunlight to steam to produce power; large-scale solar photovoltaic (PV), which uses PV cells to directly produce electricity from sunlight; and small-scale solar, which are PV installations of 1 megawatt or smaller. Generation from solar thermal sources has remained relatively flat in recent years, at about 3 million MWh. The most recent addition of solar thermal capacity was the Crescent Dunes Solar Energy plant installed in Nevada in 2015, and currently no solar thermal generators are under construction in the United States.

Solar photovoltaic systems, however, have consistently grown in recent years. In 2014, large-scale solar PV systems generated 15 million MWh, and small-scale PV systems generated 11 million MWh. By 2017, annual electricity from those sources had increased to 50 million MWh and 24 million MWh, respectively. By the end of 2018, EIA expects an additional 5,067 MW of large-scale PV to come online, according to EIA’s Preliminary Monthly Electric Generator Inventory. Information about planned small-scale PV systems (one megawatt and below) is not collected in that survey.

Tesla Solar and Powerwall Discount offers a ~10% installation price cut amid PG&E blackouts, helping California homeowners with solar panels, battery storage, and backup power, while supporting renewable energy and resilient Supercharger infrastructure.

Key Points

A ~10% installation discount on Tesla solar panels and Powerwall batteries to boost backup power during PG&E blackouts.

✅ ~10% off installation for solar plus Powerwall

✅ Helps during PG&E shutoffs and wildfire mitigation

✅ Supports resilience, backup power, and EV charging

Pacific Gas & Electric’s (PG&E) shutoff of electric supply to residents in California’s Bay Area has caught the attention of Tesla and SpaceX CEO Elon Musk, who, while highlighting a huge future for Tesla Energy in coming years, has announced that he would be offering a price reduction of approximately 10% for a solar panel and Tesla Powerwall battery installation. The discount will be available to anyone interested in powering their homes with solar energy, not just the 800,000 affected homes in the Bay Area.

After initially tweeting a link to Tesla’s Solar page on Tesla.com, Musk added that he would be offering a “~10% price reduction” in installation price for solar panels and Powerwall batteries for anyone, as California explores EVs for grid stability during emergencies, including those who have lost power in response to PG&E’s power shutoff. The blackout induced by the California-based power company is a part of an effort to reduce the possibility of wildfires. PG&E lines were the cause of multiple fires in the past, so the company is taking every necessary precaution to reduce the probability of its lines causing another fire in the future.

Tesla Solar recently offered a subscription program that would allow homeowners to lease panels for a fraction of the cost. The service is available to both residential and commercial customers, and costs as little as $45 a month in some states, particularly appealing in California where EV sales top 20% recently. The option to lease solar panels carries no long-term contracts that would tie down customers to a lengthy commitment.

Wildfires have always been an issue in California. Currently, fires are ripping through Los Angeles county, presumably caused by the winds of the Autumn season. The effort to reduce the environmental impact of forest fires in the state has been increasingly more prevalent over the years. But 2019 is a different story, underscoring that California may need a much bigger grid to support electrification, considering the previous year was noted as the deadliest wildfire season in California’s history. Over 8,500 fires destroyed over 1.89 million acres of land burned due to fires, causing the California Department of Forestry and Fire Protection to spend $432 million through the end of August 2018, according to the Associated Press.

In reaction to the news of the power shutoffs, Tesla added words of advice to vehicle affected owners on its app. The company posted a message encouraging drivers to keep their vehicles charged to 100% and highlighted that EVs can power homes for up to three days during outages, in order to prevent interruptions in driving. Those who are driving ICE vehicles are feeling the effects of the blackout too, as gas stations in California’s affected region have begun to shut down. Musk also tweeted that he would be installing Tesla Powerpacks at all Supercharger stations in the affected region, a move that can help ease strain on state power grids during outages, in order to allow owners to charge their vehicles.

In addition to the efforts that Tesla has already put into place, Musk plans to transition all Supercharger stations to solar power as soon as possible. But the sunny climate of California offers residents a great opportunity to move from gas and electric, even as some warn of a looming green car wreck in the state, to a more eco-friendly, sun-powered option. Tesla solar will completely eliminate power blackouts that are used to control wildfires in California.

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DBRS Limited (DBRS) confirmed the Issuer Rating and the Unsecured Debt rating of Ontario Power Generation Inc. (OPG or the Company) at A (low) and the Commercial Paper (CP) rating at R-1 (low).

All trends are Stable. The ratings of OPG continue to be supported by (1) the reasonable regulatory regime in place for the Company's regulated generation facilities, (2) strong cash flow-to-debt and debt-to-capital ratios and (3) continuing financial support from its shareholder, the Province of Ontario (the Province; rated AA (low) with a Stable trend by DBRS). The Province, through its agent, the Ontario Electricity Financial Corporation (rated AA (low) with a Stable trend by DBRS), provides most of OPG's financing (approximately 43% of consolidated debt). The Company's remaining debt includes project financing (31%), non-recourse debt issued by Fair Hydro Trust (Senior Notes rated AAA (sf), Under Review with Negative Implications by DBRS; 11%), CP (2%) and Senior Notes issued under the Medium Term Note Program (12%).

In March 2019, the Province introduced 'Bill 87, Fixing the Hydro Mess Act, 2019' which includes winding down the Fair Hydro Plan. OPG will remain as the Financial Services Manager for the outstanding Fair Hydro Trust debt, which will become obligations of the Province. DBRS does not expect this development to have a material impact on the Company as (1) the Fair Hydro Trust debt will continue to be bankruptcy-remote and ring-fenced from OPG (all debt is non-recourse to the Company) and (2) the credit rating on the Company's investment in the Subordinated Notes (rated AA (sf), Under Review with Negative Implications by DBRS) will likely remain investment grade while the Junior Subordinated Notes (rated A (sf), Under Review with Developing Implications by DBRS) will not necessarily be negatively affected by this change (see the DBRS press release, 'DBRS Maintains Fair Hydro Trust, Series 2018-1 and Series 2018-2 Notes Under Review,' dated March 26, 2019, for more details).

OPG's key credit metrics improved in 2018, following the approval of its 2017-2021 rates application by the Ontario Energy Board in December 2017. The Company's profitability strengthened significantly, with corporate return on equity (ROE) of 7.8% (adjusted for a $205 million gain on sale of property; 5.1% in 2017) closer to the regulatory allowed ROE of 8.78%. However, DBRS continues to view a positive rating action as unlikely in the short term because of the ongoing large capital expenditures program, including the $12.8 billion Darlington Refurbishment project. However, a downgrade could occur should there be significant cost overruns with the Darlington Refurbishment project that result in stranded costs. DBRS notes that the Darlington Refurbishment project is currently on budget and on schedule.

Hydro-Quebec back-billing arises from analogue meter errors and estimated consumption, leading to arrears for electricity usage; disputes over access, payment plans, and potential power diversion reviews can impact cottage owners near Gatineau.

Key Points

Hydro-Quebec back-billing recovers underbilled electricity from analogue meter errors or prolonged estimated use.

✅ Triggered by inaccurate analogue meters or missed readings

✅ Based on actual usage versus prior estimated consumption

✅ Payment plans may spread arrears; theft checks may adjust

A relaxing lakefront cottage has become a powerful source of stress for an Ottawa woman who Hydro-Quebec is charging $5,300 to cover what it says are years of undercharging for electricity usage.

The utility said an old analogue power meter is to blame for years of inaccurate electricity bills for the summer getaway near Gatineau, Que.

Separate from individual billing issues, Hydro-Quebec has also reported pandemic-related losses earlier this year.

Owner Jan Hodgins does not think she should be held responsible for the mistake, nor does she understand how her usage could have surged over the years.

“I’m very hydro conscious, because I was raised that way. When you left a room, you always turned the light out,” she told CTV Montreal on Wednesday, relating her shock after receiving some hefty bills from Hydro-Quebec on Sept. 22.

Hodgins said she mainly uses the cottage on weekends, does not heat the place when she is not there, and does not use a washer or dryer, to keep her energy footprint as small as possible. She’s owned the cottage for 14 years, during which she says her monthly bill has hovered around $40.

Hydro-Quebec said it has not had an accurate reading of her usage for several years, relying instead on consumption estimates to determine what she pays. The company recently reviewed her energy consumption back to 2014, and found their estimates were not accurate.

“In the past, she was consuming about 10 to 15 kilowatt hours per day. This summer she was more around 40 kilowatt hours per day,” Marc-Antoine Pouliot with Hydro-Quebec told CTV Ottawa.

Hodgins said that means her regular bill will now be more than twice the $200 her neighbours are paying for hydro each month, even with peak hydro rates in place.

Hydro-Quebec said it will correct the bill if its technicians discover that someone is illegally diverting power nearby.

Hodgins said it’s not her fault that technicians did not check her meter in person, and chose to rely on inaccurate estimates. Pouliot argues that reaching her cottage was too difficult.

“There was too much snow. There were conditions during the winter disconnection ban period, and the consequence was that people, our workers, were not able to reach the meter,” he said.

Hydro-Quebec said it is willing to stretch out the debt into monthly payments over a year, which Hodgins said amount to $440 per month on top of her regular bill.

Utilities also caution customers about scammers threatening shutoffs during billing disputes.

“I’m on a fixed income. I don’t have that kind of money. I’m completely distraught,” she said. “I don’t know what I’m going to do.”

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Skinners Pond Transmission Line expands PEI's renewable energy grid, enabling wind power integration, grid reliability, and capacity for the planned 40 MW windfarm, funded through the Green Infrastructure Stream to support sustainable economic growth.

Key Points

A 106-km grid project enabling PEI wind power, increasing capacity and reliability, linking Skinners Pond to Sherbrooke.

✅ 106-km line connects Skinners Pond to Sherbrooke substation

✅ Integrates 40 MW windfarm capacity by 2025

✅ Funded by Canada and PEI via Green Infrastructure Stream

The health and well-being of Canadians are the top priorities of the Governments of Canada and Prince Edward Island. But the COVID-19 pandemic has affected more than Canadians' personal health. It is having a profound effect on the economy.

That is why governments have been taking decisive action together to support families, businesses and communities, and continue to look ahead to planning for our electricity future and see what more can be done.

Today, Bobby Morrissey, Member of Parliament for Egmont, on behalf of the Honourable Catherine McKenna, Minister of Infrastructure and Communities, the Honourable Dennis King, Premier of Prince Edward Island, the Honourable Dennis King, Premier of Prince Edward Island, and the Honourable Steven Myers, Prince Edward Island Minister of Transportation, Infrastructure and Energy, announced funding to build a new transmission line from Sherbrooke to Skinners Pond, as part of broader Canadian collaboration on clean energy, with several premiers nuclear reactor technology to support future needs as well.

The new 106-kilometre transmission line and its related equipment will support future wind energy generation projects in western Prince Edward Island, complementing the Eastern Kings wind farm expansion already advancing. Once completed, the transmission line will increase the province's capacity to manage the anticipated 40 megawatts from the future Skinner's Pond Windfarm planned for 2025 and provide connectivity to the Sherbrooke substation to the northeast of Summerside.

The Government of Canada is investing $21.25 million and the Government of Prince Edward Island is providing $22.75 million in this project, reflecting broader investments in new turbines across Canada, through the Green Infrastructure Stream (GIS) of the Investing in Canada infrastructure program.

This projects is one in a series of important project announcements that will be made across the province over the coming weeks. The Governments of Canada and Prince Edward Island are working cooperatively to support jobs, improve communities and build confidence, while safely and sustainably restoring economic growth, as Nova Scotia increases wind and solar projects across the region.

"Investing in renewable energy infrastructure is essential to building healthy, inclusive, and resilient communities. The new Skinners Pond transmission line will support Prince Edward Island's production of green energy, focusing on wind resources rather than expanded biomass use in the mix. Projects like this also support economic growth and help us build a greener future for the next generation of Islanders."

Bobby Morrissey, Member of Parliament for Egmont, on behalf of the Honourable Catherine McKenna, Minister of Infrastructure and Communities

"We live on an Island that has tremendous potential in further developing renewable energy. We have an opportunity to become more sustainable and be innovative in our approach, and learn from regions where provinces like Manitoba have clean energy to help neighbouring provinces through interties. The strategic investment we are making today in the Skinner's Pond transmission line will allow Prince Edward Island to further harness the natural power of wind to create clean, locally produced and locally used energy that will benefit of all Islanders."

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US Electricity Demand Outlook examines EIA forecasts, GDP decoupling, energy efficiency, electrification, electric vehicles, grid load growth, and weather variability to frame long term demand trends and utility planning scenarios.

Key Points

An analysis of EIA projections showing demand decoupling from GDP, with EV adoption and efficiency shaping future grid load.

✅ EIA lowers load growth; demand decouples from GDP.

✅ Efficiency and sector shifts depress kWh sales.

✅ EV adoption could revive load and capacity needs.

Electricity producers and distributors are in an unusual business. The product they provide is available to all customers instantaneously, literally at the flip of a switch. But the large amount of equipment, both hardware and software to do this takes years to design, site and install.

From a long range planning perspective, just as important as a good engineering design is an accurate sales projections. For the US electric utility industry the most authoritative electricity demand projec-tions come from the Department of Energy’s Energy Information Administration (EIA). EIA's compre-hensive reports combine econometric analysis with judgment calls on social and economic trends like the adoption rate of new technologies that could affect future electricity demand, things like LED light-ing and battery powered cars, and the rise of renewables overtaking coal in generation.

Before the Great Recession almost a decade ago, the EIA projected annual growth in US electricity production at roughly 1.5 percent per year. After the Great Recession began, the EIA lowered its projections of US electricity consumption growth to below 1 percent. Actual growth has been closer to zero. While the EIA did not antici-pate the last recession or its aftermath, we cannot fault them on that.

After the event, though, the EIA also trimmed its estimates of economic growth. For the 2015-2030 period it now predicts 2.1 percent economic and 0.3 percent electricity growth, down from previously projections of 2.7 percent and 1.3 percent respectively. (See Figures 1 and 2.)

Table 1. EIA electric generation projections by year of forecast (kWh billions)

Table 2. EIA forecast of GDP by year of forecast (billion 2009 $)

Back in 2007, the EIA figured that every one percent increase in economic activity required a 0.48 percent in-crease in electric generation to support it. By 2017, the EIA calculated that a 1 percent growth in economic activity now only required a 0.14 percent increase in electric output. What accounts for such a downgrade or disconnect between electricity usage and economic growth? And what factors might turn the numbers 
around?

First, the US economy lost energy intensive heavy industry like smelting, steel mills and refineries; patterns in China's electricity sector highlight how industrial shifts can reshape power demand. A more service oriented economy (think health care) relies more heavily on the movement of data or information and uses far less power than a manufacturing-oriented economy.

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Second, internet shopping has hurt so-called "brick and mortar" retailers. Despite the departure of heavy industry, in years past a burgeoning US commercial sector increased its demand and usage of electricity to offset the industrial decline. But not anymore. Energy efficiency measures as well as per-haps greater concern about global warming and greenhouse gas emissions and have cut into electricity sales. “Do more with less” has the right ring to it.

But there may be other components to the ongoing decline in electricity usage. Academic studies show that electricity usage seems to increase with income along an S curve, and flattens out after a certain income level. That is, if you earn $1 billion per year you do not (or cannot) use ten times a much electricity as someone earning only $100 million.

But people at typical, middle income levels increase or decrease electricity usage when incomes rise or fall. The squeeze on middle income families was discussed often in the late presidential campaign. In recent decades an increasing percentage of income has gone to a small percentage of the population at the top of the income scale. This trend probably accounts for some weakness in residential sales. This suggests that government policy addressing income inequality would also boost electricity sales.

Population growth affects demand for electricity as well as the economy as a whole. The EIA has made few changes in its projections, showing 0.7 percent per year population growth in 2015- 2030 in both the 2007 and 2017 forecasts. Recent studies, however, have shown a drop in the birth rate to record lows. More troubling, from a national health perspective is that the average age of death may have stopped rising. Those two factors point to lower population growth, especially if the government also restricts immi-gration. Thus, the US may be approaching a period of rather modest population growth.

All of the above factors point to minimal sales growth for electricity producers in the US--perhaps even lower than the seemingly conservative EIA estimates. But the cloud on the horizon has a silver lining in the shape of an electric car. Both the United Kingdom and France have set dates to end of production of automobiles with internal combustion engines. Several European car makers have declared that 20 percent of their output will be electric vehicles by the early 2020s. If we adopt automobiles powered by electricity and not gasoline or diesel, electricity sales would increase by one third. For the power indus-try, electric vehicles represent the next big thing.

We don’t pretend to know how electric car sales will progress. But assume vehicle turnover rates re-main at the current 7 percent per year and electric cars account for 5 percent of sales in the first five years (as op-posed to 1 percent now), 20 percent in the next five years and 50 percent in the third five year period. Wildly optimistic assumptions? Maybe. By 2030, electric cars would constitute 28 percent of the vehicle fleet. They would add about 10 percent to kilowatt hour sales by that date, assuming that battery efficiencies do not improved by then. Those added sales would require increased electric generation output, with low-emissions sources expected to cover almost all the growth globally. They would also raise long term growth rates for 2015-2030 from the present 0.3 percent to 1.0 percent. The slow upturn in demand should give the electric companies time to gear up so to speak.

In the meantime, weather will continue to play a big role in electricity consumption. Record heat-induced demand peaks are being set here in the US even as surging global demand puts power systems under strain worldwide.

Can we discern a pattern in weather conditions 15 years out? Maybe we can, but that is one topic we don’t expect a government agency to tackle in public right now. Meantime, weather will affect sales more than anything else and we cannot predict the weather. Or can we?

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