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Monthly Archives

October 2016

SOLAR ELECTRICITY MOVE CLOSER TO GRID PARITY

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Written by Nani Pradeepan, P.Eng.

First, what does Grid Parity mean? Grid parity means, solar PV system produce electricity for the same cost as the electricity available on a utility’s transmission and distribution “grid” from other traditional sources such as nuclear, hydro, coal, gas, oil etc. As we all know cost of electricity from other sources can only go up but properly designed and installed solar electricity cost does not change much over the years as operational cost is comparatively near zero.

Significant incentives and number of resulting solar installations have resulted in substantial prices reductions in the cost of solar power system. This means depending on the country and resources used for electricity generation, solar electricity has achieved or approaching grid parity in many parts of the world including Canada.

Solar equipment prices are three time less expensive today than it was seven years ago at the start of Ontario’s Feed in Tariff program. This has enabled electricity generation from solar closer to grid parity ahead of schedule. Other costs such as balance of system materials, labour costs have not dropped significantly but overall project cost also has dropped proportionately.

Even though hardware cost associated with solar project has come down in last seven years, soft cost (getting the incentive approvals, permit fees, LDC charges etc..) associated with solar project has gone in the other direction. It is industry’s hope that transition from Feed in Tariff program to Net-metering program will bring down these costs as well.

This drop in solar project cost has helped Ontario government to lower the incentive paid to solar power system owners and Ontario government has already decide to phase out the incentives by end of 2017. Solar system owners who secure a contract with Ontario government for selling the electricity into the grid before end of the program will receive payment for their solar electricity for 20 years from their contract start date.

Economics’ basic principle of supply and demand which has caused the significant price reduction in solar equipment price can also go other way. As more people in more countries decide to go solar, demand for solar equipment can surpass the supply and results in higher solar equipment prices. It remains to be seen what will happen to the PV equipment market. As solar industry become mature similar to Ontario government, governments around the world will phase out incentives provided for solar projects. This may keep the balance of global solar equipment supply and demand and keep solar equipment price stable.

This scenario for solar electricity reaching Grid Parity has already initiated changes in the way electricity is produced and distributed. This is just a start look out for the interesting time is a head for energy industry.

MANDATORY BENCHMARKING

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Written by Narayana Asogan, P.Eng.

In June 2016, “Energy Conservation and Long Term Energy Planning” bill (Bill 135) was passed in the Ontario Parliament, and now it is a Law.  Electricity Act 1998, Green Energy Act 2009, Ontario Energy Board Act 1998 are affected by Bill 135.

Similar laws are in practice in Several US states, Europe, Australia for many years now, encouraging buildings to be more energy efficient, reduce waste of energy and water.  Ontario is the first Canadian Province to implement reporting of Energy and water use encouraging large buildings to be more energy efficient.

Who are affected by this Law?

Energy and water reporting rules are to be developed by a Public Agency and applicable to Commercial, Industrial and Multi-Unit Residential Buildings (MURBs).  Owners will be mandated to benchmark energy, water usage and Green House Gas (GHG) emission and provide details to Ministry of Energy.

The very first step in any long term improvement plan is Bench marking. Benchmarking is the practice of comparing the performance of an object to its peers and or established standards. It also helps to monitor the performance of the object over time and relative to similar objects.

Timeline for reporting:

Commercial/Industrial – 250,000 Sq Ft and above – July 2017

Commercial/Industrial – 100,000 Sq Ft and above, MURB – 100,000 Sq Ft and above – July 2018

Commercial/ Industrial – 50,000 Sq Ft and above, MURB – 50,000 Sq Ft and above – July 2019

Reporting of electricity, gas, oil, GHG, water consumption will be required.

Many jurisdictions who adopted energy benchmarking had shown energy and water (thus money) savings of around 10%.

Portfolio Manager developed by Natural Resources Canada with Canadian Data is recommended for Benchmarking and energy use studies and reporting.

Benchmarking and tracking energy usage coupled with good audit methods would save energy, improve energy usage intensity, GHG emission.  Energy audit will guide in long term energy use planning of the building / operations.

Energy Star Score

Energy Star score is measured on a scale of 1 to 100 and involves around 150 metrics.  Basic property information, energy use information, number of rooms, Heating/cooling Degree Days (HDD/CDD) etc are some of the information required.  Once the required information is entered into Portfolio Manager, the buildings Energy Star Score could be obtained.  Larger the number, more energy efficient is the building.  Lower numbers indicate that there is a good potential for improvement.

In multi building management situation, benchmarking all the buildings will show which building requires early attention for improvements etc.

Who can do this task of data collection, analysis and reporting?

Generally anyone could do this.  However the busy Building operators may not get the time to record relevant data without scarifying normal maintenance duties.  In many building operations, maintenance is delayed or overlooked due to various reasons and the building and equipment may be already in poor state, resulting in maintenance situation to more costly replacement situation.

Third Party Consultants

A third party consultant (like New Dawn Energy Solutions) with specific task of such data collection and study would be beneficial to the building owners under these conditions as the legal requirements of energy and water reporting and benchmarking could be done more professionally.

As the time is short and initial data collection and assembly task would have various snags, it would be advisable to start this process early.

Also energy saving project funding including Audit funding are available from Utility providers.

Phone: 416-855-9377