Battery energy storage system eyed near Woodstock

Clean Electricity Standard drives Biden's infrastructure, grid decarbonization, and utility mandates, leveraging EPA regulation, renewables, nuclear, and carbon capture via reconciliation to reach 80% clean power by 2030 amid partisan Congress.

Key Points

A federal mandate to reach 80% clean U.S. power by 2030 using incentives and EPA rules to speed grid decarbonization.

✅ Targets 80% clean electricity by 2030 via Congress or reconciliation

✅ Mix of renewables, nuclear, gas with carbon capture allowed

✅ Backup levers: EPA rules, incentives, utility planning shifts

The true measure of President Biden’s climate ambition may be the clean electricity standard he tucked into his massive $2.2 trillion infrastructure spending plan.

Its goal is striking: 80% clean power in the United States by 2030.

The details, however, are vague. And so is Biden’s plan B if it fails—an uncertainty that’s worrisome to both activists and academics. The lack of a clear backup plan underscores the importance of passing a clean electricity standard, they say.

If the clean electricity standard doesn’t survive Congress, it will put pressure on the need to drive climate policy through targeted spending, said John Larsen, a power system analyst with the Rhodium Group, an economic consulting firm.

“I don’t think the game is lost at all if a clean electricity standard doesn’t get through in this round,” Larsen said. “But there’s a difference between not passing a clean electricity standard and passing the right spending package.”

In his few months in office, Biden has outlined plans to bring the United States back into the international Paris climate accord, pause oil and gas leasing on public lands, boost the electric vehicle market, and target clean energy investments in vulnerable communities, including plans to revitalize coal communities across the country, most affected by climate change.

But those are largely executive orders and spending proposals—even as early assessments show mixed results from climate law—and unlikely to last beyond his administration if the next president favors fossil fuel usage over climate policy. The clean electricity standard, which would decarbonize 80% of the electrical grid by 2030, is different.

It transforms Biden’s climate vision from a goal into a mandate. Passing it through Congress makes it that much harder for a future administration to undo. If Biden is in office for two terms, the United States would see a rate of decarbonization unparalleled in its history that would set a new bar for most of the world’s biggest economies.

But for now, the clean electricity standard faces an uncertain path through Congress and steep odds to getting enacted. That means there’s a good chance the administration will need a plan B, observers said.

Exactly what kind of climate spending can pass Congress is the very question the White House and congressional Democrats will be working on in the next few months, including upgrades to an aging power grid that affect renewables and EVs, as the infrastructure bill proceeds through Congress.

Negotiations are fraught already. Congress is almost evenly split between a party that wants to curtail the use of fossil fuels and another that wants to grow them, and even high energy prices have not necessarily triggered a green transition in the marketplace.

Senate Minority Leader Mitch McConnell (R-Ky.) said last week that “100% of my focus is on stopping this new administration.” He made similar comments at the start of the Obama administration and blocked climate policy from getting through Congress. He also said last week that no Republican senators would vote for Biden’s infrastructure spending plan.

A clean electricity standard has been referred to as the “backbone” of Biden’s climate policy—a way to ensure his policies to decarbonize the economy outlast a future president who would seek to roll back his climate work. Advocates say hitting that benchmark is an essential milestone in getting to a carbon-free grid by 2035. Much of President Obama’s climate policy, crafted largely through regulations and executive orders, proved vulnerable to President Trump’s rollbacks.

Biden appears to have learned from those lessons and wants to chart a new course to mitigate the worst effects of climate change. He’s using his majority in the House and Senate to lock in whatever he can before the 2022 midterms, when Democrats are expected to lose the House.

To pass a clean electricity standard, virtually every Democrat must be on board, and even then, the only chance of success is to pass a bill through the budget reconciliation process that can carry a clean electricity standard. Some Senate Democrats have recently hinted that they were willing to split the bill into pieces to get it through, while others are concerned that although this approach might win some GOP support on traditional infrastructure such as roads and bridges, it would isolate the climate provisions that make up more than half of the bill.

The most durable scenario for rapid electricity-sector decarbonization is to lock in a bipartisan clean electricity standard into legislation with 60 votes in the Senate, said Mike O’Boyle, the director of electricity policy for Energy Innovation. Because that’s highly unlikely—if not impossible—there are other paths that could get the United States to the 80% goal within the next decade.

“The next best approach is to either, or in combination, pursue EPA regulation of power plant pollution from existing and new power plants as well as to take a reconciliation-based approach to a clean electricity standard where you’re basically spending federal dollars to provide incentives to drive clean electricity deployment as opposed to a mandate per se,” he said.

Either way, O’Boyle said the introduction of the clean electricity standard sets a new bar for the federal government that likely would drive industry response even if it doesn’t get enacted. He compared it to the Clean Power Plan, Obama’s initiative to limit power plant emissions. Even though the plan never came to fruition, because of a Clean Power Plan rollback, it left a legacy that continues years later and wasn’t negated by a president who prioritized fossil fuels over the climate, he said.

“It never got enacted, but it still created a titanic shift in the way utilities plan their systems and proactively reposition themselves for future carbon regulation of their electricity systems,” O’Boyle said. “I think any action by the Biden administration or by Congress through reconciliation would have a similar catalytic function over the next couple years.”

Some don’t think a clean electricity standard has a doomed future. Right now, its provisions are vague. But they can be filled in in a way that doesn’t alienate Republicans or states more hesitant toward climate policy, said Sally Benson, an engineering professor at Stanford University and an expert on low-carbon energy systems. The United States is overdue for a federal mandate that lasts through multiple administrations. The only way to ensure that happens is to get Republican support.

She said that might be possible by making the clean electricity standard more flexible. Mandate the goals, she said, not how states get there. Going 100% renewable is not going to sell in some states or with some lawmakers, she added. For some regions, flexibility will mean keeping nuclear plants open. For others, it would mean using natural gas with carbon capture, Benson said.

While it might not meet the standards some progressives seek to end all fossil fuel usage, it would have a better chance of getting enacted and remaining in place through multiple presidents, she said. In fact, a clean electricity standard would provide a chance for carbon capture, which has been at the center of Republican climate policy proposals. Benson said carbon capture is not economical now, but the mandate of a standard could encourage investments that would drive the sector forward more rapidly.

“If it’s a plan that people see as shutting the door to nuclear or to natural gas plus carbon capture, I think we will face a lot of pushback,” she said. “Make it an inclusive plan with a specific goal of getting to zero emissions and there’s not one way to do it, meaning all renewables—I think that’s the thing that could garner a lot of industrial support to make progress.”

In addition to industry, Biden’s proposed clean electricity standard would drive states to do more, said Larsen of the Rhodium Group. Several states already have their own version of a clean energy standard and have driven much of the national progress on carbon emissions reduction in the last four years, he said. Biden has set a new benchmark that some states, including those with some of the biggest economies in the United States, would now likely exceed, he said.

“It is rare for the federal government to get out in front of leading states in clean energy policy,” he said. “This is not usually how climate policy diffusion works from the state level to the federal level; usually it’s states go ahead and the federal government adopts something that’s less ambitious.”

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Electric Vehicle Ownership Costs include lower maintenance, repair, and fuel expenses; Consumer Reports shows BEV and PHEV TCO beats ICE over 200,000 miles, with per-mile savings compounding through electricity prices and reduced service.

Key Points

Lifetime EV expenses, typically lower than ICE, due to cheaper electricity, reduced maintenance, and fewer repairs.

✅ BEV: $0.012/mi to 50k; $0.028/mi after; vs ICE up to $0.06/mi

✅ PHEV: $0.021/mi to 50k; $0.031/mi after; still below ICE

✅ Savings increase over 200k miles from fuel and service reductions

Electric vehicles are a relatively new technology, and the EV age is arriving ahead of schedule today. Even though we technically saw the first battery-powered vehicles more than 100 years ago, they haven’t really become viable transportation in the modern world until recently, and they are greener than ever in all 50 states as the grid improves.

As viable as they may now be, however, it still seems they’re unarguably more expensive than their conventional internal-combustion counterparts, prompting many to ask whether it’s time to buy an electric car today. Well, until now.

Lower maintenence costs and the lower price of electricity versus gasoline (see the typical cost to charge an electric vehicle in most regions) actually make electric cars much cheaper in the long run, despite their often higher purchase price, according to a new survey by Consumer Reports. The information was collected using annual reliability surveys conducted by CR in 2019 and 2020.

In the first 50,000 miles (80,500 km), battery electric vehicles cost just US$0.012 per mile for maintenence and repairs, while plug-in hybrid models bump that number up to USD$0.021. Compare these numbers to the typical USD$0.028 cost for internal combustion vehicles, and it becomes clear the more you drive, the more you will save, and across the U.S. plug-ins logged 19 billion electric miles in 2021 to prove the point. After 50,000 miles, the costs for BEV and PHEV vehicles is US$0.028 and US$0.031 respectively, while ICE vehicles jump to US$0.06 per mile.

To put it more practically, if you chose to buy a Model 3 instead of a BMW 330i, you’d see a total US$17,600 in savings over the lifetime of the vehicle, aligning with evidence that EVs are better for the planet and your budget as well, based on average driving. In the SUV sector, buying a Tesla Model Y instead of a Lexus crossover would save US$13,400 (provided the former’s roof doesn’t fly off) and buying a Nissan Leaf over a Honda Civic would save US$6,000 over the lifetime of the vehicles.

CR defines the vehicle’s “lifetime” as 200,000 miles (320,000 km). Ergo the final caveat: while it sounds like driving electric means big savings, you might only see those returns after quite a long period of ownership, though some forecasts suggest that within a decade adoption will be nearly universal for many drivers.

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California EV Sales 2023 show rising BEV market share, strong Tesla Model Y and Model 3 demand, hybrid growth, and ICE decline, per CNCDA Q3 data, underscoring California auto trends and ZEV policy momentum.

Key Points

BEVs hit 21.5% YTD in 2023 (22.3% in Q3); 35.4% with hybrids, as ICE share fell and Tesla led the California market.

✅ BEVs 21.5% YTD; 22.3% in Q3 per CNCDA data

✅ Tesla Model Y, Model 3 dominate; 62.9% BEV share

✅ ICE share down to 64.6%; hybrids lift to 35.4% YTD

The California New Car Dealers Association (CNCDA) reported on November 1, 2023, that sales of battery electric cars accounted for 21.5% of new car sales in the Golden State during the first 9 months of the year and 22.3% in the third quarter. At the end of Q3 in 2022, sales of electric cars stood at 16.4%. In 2021, that number was 9.1%. So, despite all the weeping and wailing and gnashing of teeth lately about green new car wreck warnings in some coverage, the news is pretty good, at least in California.

When hybrid and hydrogen fuel cell vehicles are included in the calculations, the figure jumps up 35.4% for all vehicles sold year to date in California. Not surprisingly this means EVs still trail gas cars in the state, with the CNCDA reporting ICE market share (including gasoline and diesel vehicles) was 64.6% so far this year, down from 71.6% in 2022 and 88.4% in 2018.

California is known as the vanguard for automotive trends in the country, with shifts in preferences and government policy eventually spreading to the rest of the country. While the state’s share of electric cars exceeds one fifth of all vehicles sold year to date, the figure for the US as a whole stands at 7.4%, with EV sales momentum into 2024 continuing nationwide. California has banned the sale of gas-powered vehicles starting in 2035, and its push toward electrification will require a much bigger grid to support charging, although the steady increase in the sale of electric cars suggests that ban may never need to be implemented as people embrace the EV revolution.

Not surprisingly, when digging deeper into the sales data, the Tesla Model Y and Model 3 dominate sales in the state’s electric car market this year, at 103,398 and 66,698 respectively. Tesla’s overall market share of battery electric car sales is at 62.9%. In fact, the Tesla Model Y is the top selling vehicle overall in California, followed by the Model 3, the Toyota RAV4 (40,622), and the Toyota Camry (39,293).

While that is good news for Tesla, its overall market share has slipped from 71.8% year to date last year at this time. Competing models from brands like Chevrolet, BMW, Mercedes, Hyundai, Volkswagen, and Kia have been slowly eating into Tesla’s market share. Overall, in California, Toyota is the sales king with 15% of sales, even as the state leads in EV charging deployment statewide, followed by Tesla at 13.5%. In the second quarter, Tesla narrowly edged out Toyota for top sales in the state before sales swung back in Toyota’s favor in the third quarter.

That being said, Tesla’s sales in the state climbed by 38.5% year to date, while Toyota’s actually shrank by 0.7%. Time will tell if Tesla’s popularity with the state’s car buyers improves and it can overtake Toyota for the 2023 crown, even as U.S. EV market share dipped in early 2024, or if other EV makers can offer better products at better prices and lure California customers who want to purchase electric cars away from the Tesla brand. Certainly, no company can expect to have two thirds of the market to itself forever.

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Shanghai Electric PEM Hydrogen R&D Center advances green hydrogen via PEM electrolysis, modular megawatt electrolyzers, zero carbon production, and full-chain industrial applications, accelerating decarbonization, clean energy integration, and hydrogen economy scale-up across China.

Key Points

A joint R&D hub advancing PEM electrolysis, modular megawatt systems, and green hydrogen industrialization.

✅ Megawatt modular PEM electrolyzer design and system integration

✅ Zero-carbon hydrogen targeting mobility, chemicals, and power

✅ Full-chain collaboration from R&D to EPC and demonstration projects

Shanghai Electric has reached an agreement with the Dalian Institute of Chemical Physics of the Chinese Academy of Sciences (the "Dalian Institute") to inaugurate the Proton Exchange Membrane (PEM) Hydrogen Production Technology R&D Center on March 4. The two parties signed a project cooperation agreement on Megawatt Modular and High-Efficiency PEM Hydrogen Production Equipment and System Development, marking an important step forward for Shanghai Electric in the field of hydrogen energy.

As one of China's largest energy equipment manufacturers, Shanghai Electric is at the forefront in the development of green hydrogen as part of China's clean energy drive. During this year's Two Sessions, the 14th Five-Year Plan was actively discussed, in which green hydrogen features prominently, and Shell's 2060 electricity forecast underscores the scale of electrification. With strong government support and widespread industry interest, 2021 is emerging as Year Zero for the hydrogen energy industry.

Currently, Shanghai Electric and the Dalian Institute have reached a preliminary agreement on the industrial development path for new energy power generation and electrolyzed water hydrogen production. As part of the cooperation, both will also continue to enhance the transformational potential of PEM electrolyzed water hydrogen production, accelerate the development of competitive PEM electrolyzed hydrogen products, and promote industrial applications and scenarios, drawing on projects like Japan's large H2 energy system to inform deployment. Moreover, they will continue to carry out in-depth cooperation across the entire hydrogen energy industry chain to accelerate overall industrialization.

Hydrogen energy boasts the biggest potential of all the current forms of clean energy, and the key to its development lies in its production. At present, hydrogen production primarily stems from fossil fuels, industrial by-product hydrogen recovery and purification, and production by water electrolysis. These processes result in significant carbon emissions. The rapid development of PEM water electrolysis equipment worldwide in recent years has enabled current technologies to achieve zero carbon emissions, effectively realizing green, clean hydrogen. This breakthrough will be instrumental in helping China achieve its carbon peak and carbon-neutrality goals.

The market potential for hydrogen production from electrolyzed water is therefore massive. Forecasts indicate that, by 2050, hydrogen energy will account for approximately 10% of China's energy market, with demand reaching 60 million tons and annual output value exceeding RMB 10 trillion. The Hydrogen: Tracking Energy Integration report released by the International Energy Agency in June 2020 notes that the number of global electrolysis hydrogen production projects and installed capacity have both increased significantly, with output skyrocketing from 1 MW in 2010 to more than 25 MW in 2019. Much of the excitement comes from hydrogen's potential to join the ranks of natural gas as an energy resource that plays a pivotal role in international trade, as seen in Germany's call for hydrogen-ready power plants shaping future power systems, with the possibility of even replacing it one day. In PwC's 2020 The Dawn of Green Hydrogen report, the advisory predicts that experimental hydrogen will reach 530 million tons by mid-century.

Shanghai Electric set its focus on hydrogen energy years ago, given its major potential for growth as one of the new energy technologies of the future and, in particular, its ability to power new energy vehicles. In 2016, the Central Research Institute of Shanghai Electric began to invest in R&D for key fuel cell systems and stack technologies. In 2020, Shanghai Electric's independently-developed fuel cell engine, which boasts a power capacity of 66 kW and can start in cold temperature environments of as low as -30°C, passed the inspection test of the National Motor Vehicle Product Quality Inspection Center. It adopts Shanghai Electric's proprietary hydrogen circulation system, which delivers strong power and impressive endurance, with the potential to replace gasoline and diesel engines in commercial vehicles.

As the technology matures, hydrogen has entered a stage of accelerated industrialization, with international moves such as Egypt's hydrogen MoU with Eni signaling broader momentum. Shanghai Electric is leveraging the opportunities to propel its development and the green energy transformation. As part of these efforts, Shanghai Electric established a Hydrogen Energy Division in 2020 to further accelerate the development and bring about a new era of green, clean energy.

As one of the largest energy equipment manufacturing companies in China, Shanghai Electric, with its capability for project development, marketing, investment and financing and engineering, procurement and construction (EPC), continues to accelerate the development and innovation of new energy. The Company has a synergistic foundation and resource advantages across the industrial chain from upstream power generation, including China's nuclear energy development efforts, to downstream chemical metallurgy. The combined elements will accelerate the pace of Shanghai Electric's entry into the field of hydrogen production.

Currently, Shanghai Electric has deployed a number of leading green hydrogen integrated energy industry demonstration projects in Ningdong Base, one of China's four modern coal chemical industry demonstration zones. Among them, the Ningdong Energy Base "source-grid-load-storage-hydrogen" project integrates renewable energy generation, energy storage, hydrogen production from electrolysis, and the entire industrial chain of green chemical/metallurgy, where applications like green steel production in Germany illustrate heavy-industry decarbonization.

In December 2020, Shanghai Electric inked a cooperation agreement to develop a "source-grid-load-storage-hydrogen" energy project in Otog Front Banner, Inner Mongolia. Equipped with large-scale electrochemical energy storage and technologies such as compressed air energy storage options, the project will build a massive new energy power generation base and help the region to achieve efficient cold, heat, electricity, steam and hydrogen energy supply.

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California EV mandate will phase out new gas cars, raising power demand and requiring renewable energy, grid upgrades, fast chargers, time-of-use rates, and vehicle-to-grid to stabilize loads and reduce emissions statewide.

Key Points

California's order ends new gas-car sales by 2035, driving grid upgrades, charging infrastructure, and cleaner transport.

✅ 25% higher power demand requires new generation and storage

✅ Time-of-use pricing and midday charging reduce grid stress

✅ Vehicle-to-grid and falling battery costs enable reliability

Leaning on the hood of a shiny red electric Ford Mustang, California Gov. Gavin Newsom signed an executive order Wednesday to end the sale of new gas-burning cars in his state in 15 years, a move with looming challenges for regulators and industry.

Now comes the hard part.

Energy consultants and academics say converting all passenger cars and trucks to run on electricity in California could raise power demand by as much as 25%. That poses a major challenge to state power grids as California is already facing periodic rolling blackouts as it rapidly transitions to renewable energy.

California will need to boost power generation, scale up its network of fast charging stations, enhance its electric grid to handle the added load and hope that battery technology continues to improve enough that millions in America’s most populous state can handle long freeway commutes to schools and offices without problems.

“We’ve got 15 years to do the work,” said Pedro Pizarro, chief executive of Edison International, owner of Southern California Edison, a utility serving 15 million people in the state. “Frankly the state agencies are going to have to do their part. We’ve got to get to the permitting processes, the approvals; all of that work is going to have to get accelerated to meet [Wednesday’s] target.”

Switching from petroleum fuels to electricity to phase out the internal combustion engine won’t happen all at once—Mr. Newsom’s order applies to sales of new vehicles, so older gas-powered cars will be on the road in California for many years to come. But the mandate means the state will face a growing demand for megawatts.

California is already facing a shortfall of power supplies over the next couple of years. The problem was highlighted last month when a heat wave blanketed the western U.S. and the state’s grid operator instituted rolling blackouts on two occasions.

“It is too early to tell what kind of impact the order will have on our power grid, and we don’t have any specific analysis or projections,” said Anne Gonzalez, a spokeswoman for the California Independent System Operator, which runs the grid.

Currently, California faces a crunchtime in the early evening as solar power falls off and demand to power air conditioners remains relatively high. Car charging presents a new potential issue: what happens if surging demand threatens to crash the grid during peak hours?

Caroline Winn, the chief executive of San Diego Gas & Electric, a utility owned by Sempra Energy that serves 3.6 million people, said there will need to be rules and rates that encourage people to charge their cars at certain times of the day, amid broader control over charging debates.

“We need to get the rules right and the markets right, informed by lessons from 2021, in order to resolve this issue because certainly California is moving that way,” she said.

The grid will need to be upgraded to prepare for millions of new electric vehicles. The majority of people who own them usually charge them at home, which would mean changes to substations and distribution circuits to accommodate multiple homes in a neighborhood drawing power to fill up batteries. The state’s three main investor-owned utilities are spending billions of dollars to harden the grid to prevent power equipment from sparking catastrophic wildfires.

“We have a hell of a lot of work to do nationally. California is ahead of everybody and they have a hell of a lot of work to do,” said Chris Nelder, who studies EV-grid integration at the Rocky Mountain Institute, an energy and environment-policy organization that promotes clean-energy solutions.

Mr. Nelder believes the investment will be worth it, because internal combustion engines generate so much waste heat and emissions of uncombusted hydrocarbons that escape out of tailpipes. Improving energy efficiency by upgrading the electrical system could result in lower bills for customers. “We will eliminate a vast amount of waste from the energy system and make it way more efficient,” he said.

Some see the growth of electric vehicles as an opportunity more than a challenge. In the afternoon, when electricity demand is high but the sun is setting and solar power drops off quickly, batteries in passenger cars, buses and other vehicles could release power back into the electric grid to help grid stability across the system, said Matt Petersen, chairman of the Transportation Electrification Partnership, a public-private effort in Los Angeles to accelerate the deployment of electric vehicles.

The idea is known as “vehicle-to-grid” and has been discussed in a number of countries expanding EV use, including the U.K. and Denmark.

“We end up with rolling batteries that can discharge power when needed,” Mr. Petersen said, adding, “The more electric vehicles we add to the grid, the more renewable energy we can add to the grid.”

One big hurdle for the widespread deployment of electric cars is driving down the cost of batteries to make the cars more affordable. This week, Tesla Inc. Chief Executive Elon Musk said he expected to have a $25,000 model ready by about 2023, signaling a broader EV boom in the U.S.

Shirley Meng, director of the Sustainable Power and Energy Center at the University of California, San Diego, said she believed batteries would continue to provide better performance at a lower cost.

“I am confident the battery technology is ready,” she said. Costs are expected to fall as new kinds of materials and metals can be used in the underlying battery chemistry, dropping prices. “Batteries are good now, and they will be better in the next 10 years.”

John Eichberger, executive director of the Fuels Institute, a nonprofit research group launched by the National Association of Convenience Stores, said he hoped that the California Air Resources Board, which is tasked with developing new rules to implement Mr. Newsom’s order, will slow the timeline if the market and electric build-out is running behind.

“We need to think about these critical infrastructure issues because transportation is not optional,” he said. “How do we develop a system that can guarantee consumers that they can get the energy when they need it?”

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Canada Renewable Energy Outlook highlights IEA forecasts of slower capacity growth as Ontario cancels LRP auctions; wind, solar, and hydro expand amid carbon pricing, coal phase-out, Alberta tenders, and falling costs despite natural gas competition.

Key Points

The Canada Renewable Energy Outlook distills IEA projections and policies behind wind, solar, and hydro growth to 2022.

✅ IEA trims Canada renewables growth to 9 GW by 2022

✅ Ontario LRP cuts and Quebec tenders reduce near-term additions

✅ Wind, solar, hydro expand amid carbon pricing and coal phase-out

A new report expects growth in Canadian renewable energy capacity to slow in the next five years compared to earlier projections, a decrease that comes after Ontario scrapped a contentious clean energy program aimed at boosting wind and solar supplies.

The International Energy Agency’s annual outlook for renewable energy, released Wednesday, projects Canada’s renewable capacity to grow by nine gigawatts between 2017 and 2022, down from last year’s report that projected capacity would grow by 13GW.

The influential Paris-based agency said its recent outlook for Canadian renewables was “less optimistic” than its 2016 projection due to “recent changes in auctions schemes in Ontario and Quebec.”

PROGRAM CUTS

In mid-2016 the Ontario government suspended the second phase of its Large Renewable Procurement (LPR) program, axing $3.8 billion in planned renewable energy contracts. And Quebec cancelled tenders for several clean energy projects, which also led the agency to trim its forecasts, the report said.

Ontario cut the LRP program amid anger over rising electricity bills, which critics said was at least partly due to the rapid expansion of wind power supplies across the province.

Experts said the rise in costs was also partly due to major one-time costs to maintain aging infrastructure, particularly the $12.8-billion refurbishment of the Darlington nuclear plant located east of Toronto. The province also has plans to renovate the nearby Pickering nuclear plant in coming years.

The IEA report comes as Ottawa aims to drastically cut carbon emissions, largely by expanding renewable energy capacity. The provinces, including the Prairie provinces, have meanwhile been looking to pare back emissions by phasing out coal and implementing a carbon tax.

While Ontario’s decision to scrap the LRP program is a minor setback in the near-term, analysts say that tightening environmental policy in Canada and elsewhere will regardless continue to drive rapid growth in renewable energy supplies like wind power and solar.

Even the threat of cheap supplies of natural gas, a major competitor to renewable supplies, is unlikely to keep wind and solar supplies off the market, despite lagging solar demand in some regions, as costs continue to fall.

“It’s not just this (Ontario) renewables program, it’s the carbon pricing program, the coal phase out, a whole plethora of programs that are squeezing natural gas margins,” said Dave Sawyer, an economist at EnviroEconomics in Ottawa.

RENEWABLE ENERGY CAPACITY

Canada’s renewable energy capacity is still expected to grow at a robust 10 per cent per year, the report said, and is expected to supply 69 per cent of overall power generation in the country by 2022.

The IEA, however, expects the growth in hydro power capacity to “slow significantly” beyond 2022, after a raft of new hydro projects come online.

Canadian hydro power capacity is projected to grow 2.2GW in the next five years, mostly due to the commissioning of the Keeyask plant in Manitoba the Muskrat Falls dam in Newfoundland and Labrador and the Romaine 3 and 4 stations in Quebec, in a sector where Canada ranks in the top 10 for hydropower jobs nationwide.

Solar capacity in Canada is expected to grow by 2GW to 4.7GW in 2022, approaching the 5 GW milestone in the near term, mostly due to feed-in-tariff programs in Ontario and renewable energy tenders currently underway in Alberta.

Globally, China and India lead renewable capacity growth projections. China alone is expected to be responsible for 40 per cent of renewable capacity growth in the next five years, while India will double its renewable electricity capacity by 2022. The world is collectively expected to grow renewable electricity capacity by 43 per cent between 2017 and 2022.

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