Report of power shortage in Ontario a Chicken Little story

October 16, 2018

IESO says the sky isn’t really falling. So why does the Globe and Mail say it is?

Reading the lead article in today’s Globe and Mail business section of October 16, 2018 headlined “Ontario faces electricity shortfall within five years” one would think the sky is falling.  The article references an IESO report which the Globe reporter suggests “In its forecast IESO concluded the projected summer peak shortfall will be about 1,400 megawatts in 2023 and will grow to 3,500 megawatts later in the decade”.

Wow!

But, spend some time reviewing the 130-page IESO document 2018 Technical Planning Conference and you will discover under the heading “Energy adequacy outlook-key observations” this statement from the IESO.

“Absent continued availability of existing resources post contract expiration, Ontario is expected to remain energy adequate until the late 2020s. Energy production shortfalls would begin to emerge in the late 2020s.”

The forecast goes on: “However, with continued availability of existing resources post-contract expiration, Ontario is expected to remain energy adequate throughout the planning outlook.”*

That means the IESO forecast, without existing expiring contracted generation, is that Ontario is “energy adequate” until the late 2020s and with continued availability until 2035!

Why the dire headline?

The IESO forecast of “Higher Demand” for Ontario starts in 2019 at about 143 TWh increasing to 163 TWh by 2035. The “Lower Demand” scenario starts at about 139 TWh in 2019 and drops to 134 TWh in 2035. To put that in context, total Ontario demand in 2017 was 136.55 TWh and generation 150.7 TWh.

On the generation side, IESO are forecasting “Energy adequacy outlook” (including exports) at 161 TWh dipping slightly after the Pickering nuclear closings and increasing to about 169 TWh in 2035. If the current generation capacity and “continued availability of existing resources” is to remain adequate and generate that output we appear to be in a comfortable position. The forecast clearly contains the caveat that shortages will occur in circumstances “Without continued availability of existing resources post contract expiry.”

What that means: any shortfalls will be occasional in nature and occur during a few peak hours. It appears IESO have plans to cover off those forecasted rare shortfalls via the Industrial Conservation Initiative (ICI) etc., as they note “The current impact of ICI is estimated to be 1,400 MW.”

How and why the Globe’s energy reporter headline suggests the sky is falling is upsetting; the latter part of his article articulates some of the factual information outlined above, yet the headline paints a dire picture.

Perhaps scary headlines sell more newspapers?

PARKER GALLANT

*The outlook period in the forecast extends to 2035.