Ontario Powers Ahead: Draft Rules Posted for CHP & CESOP

As mentioned in a previous post, the Ontario Power Authority (OPA) announced its intention to move forward with two exciting initiatives:

1. individually negotiated Combined Heat and Power (CHP) projects greater than 20 MW in capacity; and
2. Clean Energy Standard Offer Programs (CESOP) for:
• up to 150 MW of new CHP using natural gas-fired electricity generating facilities of 20 MW or less, under the Combined Heat and Power Standard Offer Program (CHPSOP), limited to cost-effective projects located in areas of the province where they can be accommodated in the local distribution system and where there are local benefits; and
• up to 50 MW during the launch period of new energy recovery facilities under the Energy Recovery Standard Offer Program (ERSOP) to support efficient generation of electricity from recovery of otherwise wasted energy sources, such as unutilized by-products that can be used as fuels. The ERSOP Program's objective is to facilitate increased development of energy recovery facilities up to a maximum capacity of 20 MW.

The OPA's draft program rules and contract were posted here today. The process for stakeholder engagement and to finalize development of the CHPSOP and ERSOP is as follows:

1. draft program documents to be posted on the OPA website for stakeholder review;
2. consultations to be held with stakeholders;
3. defined period for written comments from stakeholders to be submitted to the OPA;
4. defined period for OPA review of submissions;
5. final program documents to be posted on the OPA website; and
6. program launch.

Activity	Date
Posting of draft program rules and contract	January 31, 2011
Stakeholder Consultations Stakeholder question and comment period Stakeholder sessions	January 31, 2011 – March 11, 2011 Formal stakeholder sessions to be held in late February – early March. Specific dates for these sessions will be announced in early February.
OPA review of stakeholder comments and submissions & posting of final program documents	March - April
Program launch	Q2 2011

CHP Trailblazer

At least one enterprising partnership has already positioned itself to take advantage of the new regulatory framework. Guelph Hydro Inc. has signed an agreement in principle with Dalkia Canada to develop three CHP/District Energy projects representing 28 MW of clean local power generation. They are meant to move the City of Guelph closer towards achieving the objectives of its revamped Community Energy Initiative.

CHP Benefits

CHP is the simultaneous generation of usable heat and power (usually electricity) in a single process using proven and reliable technology. Otherwise excess heat is harnessed and distributed to buildings as hot water or steam via underground district heating pipes. During the summer, the use of absorption chillers allows cool water to be fed through the pipes to increase cooling capacity.

Ryaverket, CHP plant in Borås, Sweden (Photo: Ulf Nilsson)

When electricity is generated at large, centralized power stations, a considerable amount of the primary energy in fuel is simply wasted as heat exhausted into the atmosphere. Use of the heat produced during electricity generation in a CHP system allows them to achieve overall efficiencies in excess of 80% at the point of use. The efficiency of a conventional coal-fired power station, which discards a significant amount of heat to atmosphere, is typically about 38% at the power station. Efficiency at the point of use is further reduced because of losses that occur during transmission and distribution.

The high level of efficiency also provides important environmental benefits. For every unit of energy (heat or electricity) produced by a CHP plant from its input fuel, the levels of carbon dioxide, oxides of nitrogen and sulphur dioxide emitted are less than half of those associated with a conventional coal-fired power station.

Sunny Days,
~Rob