The Blackout A Year Later: What Have We Learned David Butters, President, Association of Power Produ

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The Blackout A Year Later What Have We
Learned?David Butters, President, Association of
Power Producers of Ontario

• October 28, 2004

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First some history
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August 14, 2003 The Day the Lights Went Out

• Normal afternoon started to degrade at 130 p.m.
• 2 lines trip between 130 p.m. and 202 p.m. in
  Ohio (one in North Ohio and one in South Ohio)
• 214 p.m. First Energys control room loses
  alarm function
• 305 341 p.m. 3 transmission lines fail as a
  result of tree contact in Ohio
• 413 p.m. - Chain reaction ends in blackout

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Restoration Paths
Primary restoration paths
Secondary restoration paths
Revised restoration paths
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Extent of Blackout

• Outage affected 50 million people and 61,800 MW
  of electric load
• Blackout hit
• In the United States
• Ohio, Michigan, Pennsylvania, New York, Vermont,
  Massachusetts, Connecticut and New Jersey
• In Canada
• Ontario suffered rolling blackouts for more than
  a week
• Estimated cost of blackout - 5.0 to 10 billion
  U.S.

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Issues Raised

• Illustrated central importance of electricity to
  the functioning of modern society and the value
  of electricity
• Revealed the vulnerability of our electric system
• Raised serious questions about the management and
  operation of the North American electric system
• More importantly a triggering event in Ontario

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The lights went on when the lights went out.

• Not a supply issue
• New understanding of the REAL value of
  electricity (if not its cost)
• PC government called an election partially on the
  strength of their management of the crisisBUT
• Liberals win a majority

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Liberal energy platform

• Will not sell off the electricity transmission
  grid, publicly owned generating stations
• Keep electricity power rates frozen at 4.3
  cents/kWh until 2006
• Phase out coal-burning generating plants by 2007,
  and replace with cleaner energy sources
• Require all electricity suppliers to get five per
  cent of their power from renewable sources by
  2007, and 10 per cent by 2010
• "Reward" those who reduce their energy
  consumption, and charge more to those who consume
  more than an average household
• Promote "smart meters," which track what time of
  day the energy is used, and charge accordingly.
  To be in place by 2006 when the rate cap is
  lifted

• Expand generating capacity, such as the station
  at Niagara Falls
• Build transmission link with Manitoba,
  representing 1,000 MW in a plan to add 30,702 MW
  to the province's generating capacity
• Create incentives for production of renewable
  energy sources
• Reduce red tape for clean-energy projects
• Work with businesses, commercial and
  institutional customers to reduce electricity
  consumption
• Make all publicly owned power entities subject to
  freedom of information and salary disclosure laws
• Create "truly independent watchdog" to regulate
  prices, utilities, and suppliers

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A Responsible Approach

• 3 November, 2003
• The price of electricity must better reflect the
  true cost of electricity
• Stable and predictable pricing
• The price will be regulated by an independent
  body in the public interest not political
  interests.

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Since last year

• 4 December, 2003
• Report Points To Mismanagement Of Pickering A
  Restart
• 18 December, 2003
• Electricity Pricing Legislation Puts Public
  Interest First
• 14 January, 2004
• Electricity Conservation And Supply Task Force
  Report Confirms Need For New Direction In
  Ontario's Electricity Sector
• 19 February, 2004
• Technical Advisor Chosen To Oversee Electricity
  Contracting Process
• 18 March, 2004
• Energy Minister Receives OPG Review Committee
  Report
• 31 March, 2004
• Ontario's New Interim Electricity Prices Take
  Effect April 1
• 15 April, 2004
• New Vision For Electricity Sector Will Mean New
  Supply, Increased Conservation, Stable Prices
• 28 April, 2004
• McGuinty Government to Increase Supply of
  Renewable Energy

• 15 June, 2004
• McGuinty Government Unveils Bold Plan To
  Restructure Electricity System
• 24 June, 2004
• McGuinty Government Sparks Interest In Green
  Electricity
• 25 June, 2004
• McGuinty Government Gives Green Light to Expand
  Electricity Generation at Niagara Falls
• 7 July, 2004
• Ontario Government Restarts Pickering Unit To
  Increase Electricity Supply
• 18 August, 2004
• Government Seeks Input On Electricity Sector
  Reform
• 8 September, 2004
• McGuinty Government To Begin Negotiations To
  Restart Two Units At Bruce Power
• 30 September, 2004
• Ontario and Manitoba Take Next Step on Joint
  Energy Project
• 21 October, 2004
• McGuinty Government Making it Easier For
  Ontarians to Conserve Energy and Save Money

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Conclusion probably better off than a year ago..

• New generation online
• Bruce 3,4
• Pickering
• Brighton Beach
• RFPs
• DR and DM

• But many questions remain unanswered
• Supply mix
• Transmission and distribution
• OPG
• Orphan generators
• Hybrid system
• Market forces
• OPA, IESO, OEB etc.
• Resource adequacy
• Pace of change
• Whats the end state?

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Thank you!www.appro.org416 322-6549