Sand in the Vaseline – Part IV

Worship the 7 percentFor the past three weeks I’ve been talking about the shortcomings of the MicroFIT program. First, the OPA’s online application process. Second, the Local Distribution Companies (LDCs) and the problematic and inconsistent ways of each. Third and most recently, the heart of the Feed-In Tariff program – the FIT rate itself. Today I’ll look at perhaps the most frustrating and potentially devastating issue – one that threatens not only the future of the Feed-In Tariff program in its various forms, but also whatever might come after it.

The issue is the 7% rule.

First, a bit of background. The electricity grid that history has bequeathed unto us is a rough beast – antiquated, creaky, and obsolete. It was designed for a very different era. In that era, the world in general was different, electricity customers were different, the thinking behind electricity transmission was different, and the approach to electricity generation was different.

The surrounding world was a big place. There were no limits – no limit on how much the economy could grow, no limit on the number of rivers that could be dammed, no limit on the amount of coal or oil or uranium that could be extracted from the ground, no limit on how much waste – smog-causing nitrogen oxides, climate-changing greenhouse gases, and near-perpetually poisonous radioactive spent nuclear fuel – that could be tossed into the environment. The world, of course, had an infinite capacity to absorb all that garbage. Humanity could dump all it wanted into the earth, air, and water, and there would be no ill effects.

Back in the day, the electricity consumer was not particularly demanding. The main uses for electricity were brute force devices – incandescent light bulbs, motors, resistance heaters, and so forth. These devices were inherently forgiving. They could withstand minor fluctuations and dips in power, and alternating current with a waveform that was something less than perfectly sinusoidal. Even an occasional outage wasn’t going to cause a catastrophe.

To get the electricity across the vast distances from where it was produced to where it was needed, the utility built high voltage transmission lines. Substations changed the attributes of the electricity from that which travelled well over distances (low current, high voltage) to that which was required for general consumption (higher current, lower voltage). Then distribution lines transmitted the power from the substations to the consumer.

Finally, generation. When the grid was built, power was generated in a very small number of facilities, each of which produced a very large amount of power. These facilities included hydroelectric dams, coal-fired generators, and nuclear reactors. As a general rule, these facilities were located a great distance from the areas of highest electricity consumption – the cities.

The times, they are a-changin’.

The surrounding world is not what it was. Most or all rivers suitable for large hydroelectric dams have been exploited. Fossil fuels are becoming harder and harder to extract. Energy-rich black coal is running desperately short, and being replaced by dirtier and less energy-dense brown coal. Most of the oil in easy-to-reach places has been extracted, forcing us to push into hostile environments – ever further offshore, into ever deeper water, or into ever colder and more dangerous arctic regions. These places have become attractive because scarcity has driven the price up inexorably. Uranium reserves still appear to be holding, but this is mostly because public enthusiasm for nuclear power has faded in the wake of horrifying disasters. Finally, the cost of waste – potentially devastating climate change being the most pressing example – is becoming more and more evident.

Electricity consumers have changed. Increasingly, we depend on complex microprocessor-driven technologies that surround us to the point that we don’t notice them any more. High-definition TVs. Satellite receivers. PVRs. Computers. Smart phones. SCADA-controlled industrial processes. Life support equipment in hospitals. Systems for dispatching emergency services – firefighters, ambulances, and police – to where they are needed. All of this technology does not respond well to a dirty and fluctuating power supply coming from an obsolete grid.

The scarcity of fuel and the side effects of waste have driven up the cost of energy. What used to be an acceptable loss – the energy dissipated as heat (and the noise of that 60Hz hum) with every kilometre of transmission lines – looks increasingly profligate. These transmission lines also look increasingly vulnerable and indefensible in an era of random global terrorism.

The change in the global environment, and the fading apparent wisdom of making massive urban areas completely dependent on distant sources of power, have driven a change in the approach to energy generation. Economics and other forces are pushing us away from centralized generation and toward distributed generation (DG), where power is provided right at the point of use through solar, wind, combined heat & power, district energy, biomass, and large-scale energy storage.

The world has changed. But the grid hasn’t changed – or at least it hasn’t changed enough.

In Ontario, the rule is that DG may not exceed one-third of the minimum load on a feeder (a feeder being a line that delivers power from a substation to consumers). This is based on a standard developed by the Institute of Electrical and Electronics Engineers (IEEE). Since the feeders in question have a minimum load that is either 20% or 30% of peak, that translates into a limit of either 7% or 10% of peak load that may come from DG.

Mind you, nobody is actually treating the IEEE1547 standard as being carved in tablets of stone and brought down from Mount Horeb by the disembodied spirit of Nicola Tesla. Or not exactly. Everyone agrees that it may be possible to push beyond these limits, given sufficient study. The Ontario Energy Board has said it. Hydro One has said it. Hydro One’s consultants, Kinectrics, have said it.

But nobody is commissioning the study. So nothing changes. In other words: “If more research was done, we might be able to make it happen. We could do the research, but we’re not going to. We’re also not going to push for anyone else to do it. Because really, the less things change, the happier we are.”

So if Hydro One, and the Ontario Energy Board, and every other decision-making body in the constellation that appeared after the breakup of Ontario Hydro all agree collectively to sit on their hands, it’s not the end of the world, right?

Actually, it just might be the end of the world. If we don’t get this right, to quote author and environmentalist Paul Hawken, …”we are stealing the future, selling it in the present, and calling it gross domestic product.”

Meanwhile, others are moving the ball further down the field. According to the L.A. Times, Hawaii recently reached a level of DG of 75% of minimum load, or 23% of peak. That is more than double the level that Ontario has decided is feasible. California recently adopted a benchmark of 100% of minimum load, or three times the Ontario threshold.

Although Ontario’s elected representatives have charted a course to a clean energy future through the Green Energy Act, they are being stonewalled. Ontario’s electricity czars have made a concerted effort to treat standards as dogma, to treat innovation like leprosy, and to treat the world like it has infinite capacity to sop up all the carbon and radioactivity they can spew out.

It is utterly reprehensible.

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3 thoughts on “Sand in the Vaseline – Part IV”

  1. Fantastically written article Alex. Much appreciated. I was in contact with some folks in Australia solar industry and the now have some renewables that are going 150% of minimum for renewables. We need to offer Hydro One and other LDC’s a portion of the FIT, $0.01- $0.02/W will get there attention. It either that or a mandate. By providing a portion of the FIT they will find the capacity and become proponents of solar and wind. The could easily go from foe to solar evangelists. They are the only ones that can solve the technical issues. The transformer equipment manufacturers want to sell upgrades so they will not stand up and say the issues don’t exist.

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    1. I’m with you on the idea that Hydro needs an incentive. California utilities have recognized that their old business model is becoming irrelevant, and are trying to find ways to extract money from net-zero homes. In effect, the grid is providing a service by acting as the battery for such ratepayers, but this means the utility has to devise a pricing model from scratch. A tall order for what is arguably the most change-averse industry on the planet.

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  2. Hey Alex,

    Great article… a couple of comments:

    – You might want to add one item. “Hawaii recently reached a level of DG of 75% of minimum load”…. the important point here is they made it 75% of minimum DAYTIME load, which is higher than the minimum load… something Ontario could do right away.
    – This NREL article is very pertinent to what we’re talking about here: http://www.nrel.gov/docs/fy12osti/54063.pdf. It gives a good description of the problems related to PV-DG and some good short and long term solutions to getting more PV on the grid. Adding some degree of home storage will definitely help to make home more independent of the grid, and could buffer the PV output to produce power that’s less variable – and less correlated with the solar power output of neighbouring PV-generators.

    Richard

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