Conservation: The Greenest path out of Energy Poverty

1. Conservation: The Greenest path out of Energy Poverty A presentation to the Low Income Energy Network Conference by Peter Love, Chief Energy Conservation OfficerJune 10, 2008

2. Overview • Key messages • The OPA’s mandate • Integrated Power System Plan (IPSP) • Ontario’s Conservation Targets • benefits of conservation • types of conservation • importance of codes and standards • OPA Conservation programs • Programs in market • Programs in development • Past Recommendations

3. Key Messages • Ontario’s conservation goals are among the most ambitious in North America • Ensuring low income Ontarians use conservation as a tool to manage rising energy costs is critical • Codes and standards are essential for long-term success

4. Ontario Power Authority Mandate • Ensure reliable, sustainable, long-term electricity supply for Ontario. • Accomplished in four ways: • Leading and coordinating conservation • Ensuring investment in needed new supply occurs • Preparing a comprehensive, long-term power system plan • Evaluating ways to make Ontario’s electricity system more self-sustaining and consumer-focused over the long term

5. Integrated Power System Plan - IPSP • Details the conservation, supply and transmission enhancements needed to ensure a reliable, sustainable electricity system for Ontario for the next 20 years • Integrated approach towards meeting future demand • Conservation targets represent 6300 MW (¼ of current capacity) • IPSP meant to be updated on a three-year schedule • next filing in 2010 • IPSP expected to cost $60 Billion over twenty years

6. Ontario’s Conservation Targets • 6,300 MW reduction in peak demand by 2025 • Achieved interim target of 1350 MW reduction by 2007 • Next Interim targets of 1,350 MW by 2010 • OPA to lead, coordinate, facilitate and build conservation capability • Meeting targets is everyone’s responsibility

7. Why conservation - Rising Price of Oil • Oil surges more than $10 to record over $138 (Reuters, June 6, 2008)

8. Why Conservation - Rising Price of Natural Gas

9. Why Conservation – Ontario electricity prices Source: IESO 2007 Ontario Market Outlook

10. Benefits of Conservation The Three Es: • Employment benefits: labour-intensive, local jobs • Economic benefits: • efficiency is cost-effective for households • protects against energy price increases • makes private sector more competitive • Environmental/health benefits: reduced GHGs, acid rain, smog

11. Ontario’s Electricity System, CO2e and Climate Change • Ontario targets are to reduce CO2e to • 6 percent below 1990 levels by 2014, • 15 percent below these levels by 2020, • 80 percent below by 2050. • Ontario recently appointed a new Climate Change Secretariat. • Canada’s targets are to reduce CO2e by 20 percent from 2006 levels by 2020 and by 60-70 percent below 2006 levels by 2050. • In Canada, 82 percent of man-made greenhouse gas emissions come from the production and use of energy. • In Ontario, 13 percent of CO2e came from the production of electricity mainly from coal-fired plants in 2006. • Implementation of the IPSP will reduce emissions from electricity sector from 25 Mt CO2e in 2006 to 7 Mt in 2014. Source: IPCC Fourth Assessment Report, Climate Change 2007 (AR4)

12. 35.0 30.0 25.0 20.0 Greenhouse Gas Emissions (Megatonnes) 15.0 10.0 5.0 0.0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 Range of Results for Scenarios Case 1A Case 1B GHG Emissions from Electricity Generation in Ontario

13. Four Types of Conservation • Conservation/Demand Management - Using less/using less during peak hours - Deferring usage to off-peak hours • Energy Efficiency - Using energy more efficiently • Fuel Switching - Switching from electricity to another fuel • Self-generation/Co-generation - Displacing load off the power grid

14. The Importance of Demand Management Source: IESO

15. Conceptual Approach to Delivering Conservation today CAPABILITY BUILDING ACTIVITY FOCUS RESOURCE ACQUISITION MARKET TRANSFORMATION today SHORT TERM LONG TERM

16. Codes and Standards

17. OPA Conservation Programs: In Market • Multi-program approach in support of low income directive through existing delivery partners • In Market Programs: In Toronto: • City of Toronto Better Buildings Partnership • Incentives for retrofits = reductions in kW demand and kWh consumption • Incentives for New Construction (affordable housing / MURB / MUSH) Outside Toronto: • Electricity Retrofit Incentive Program • Incentives for prescriptive and custom measures; delivered through LDC • High Performance New Construction • Tiered incentives for new buildings which exceed MNBC including incentives for architects (affordable housing / MURB / MUSH) • Delivered by Enbridge Gas Distribution • More Info: http://www.toronto.ca/bbp/index.htm http://business.everykilowattcounts.com/index.php www.hpnc.ca

18. OPA Conservation Programs: In development • Pilots completed in late 2007 will inform program design • Programs will include: • Low Income Single Family Homes • Direct Install Program • Multi Family Building Program • Variety of elements for Assisted and Social Housing • Aboriginal Pilot – retrofits to housing units on reserves • Fuel Switching – electric heat conversion • Conservation Fund supporting pilot looking at different conservation measures including: lighting, refrigerators and sub-metering

19. 2007 CECO Report – Recommended Actions Recommended actions include: Government • Government evaluate options to assist low-income households with economic burden associated with upgrading to energy efficient equipment • Government develop educational programs and tools needed to enable customers to learn about and benefit from smart meters. • Reconfigure role of Chief Energy Conservation Officer to advocate conservation for other forms of energy • Develop a comprehensive and cohesive energy conservation policy - facilitated by CAT • Require government departments to consider this policy in their decision-making processes • I.e. Develop minimum energy performance standards for new affordable housing units

20. Take the Conservation Challenge Take action! Respond to the challenge and the opportunity of energy conservation Contact us: Chief Energy Conservation OfficerConservation Bureau 120 Adelaide Street WestSuite 1600Toronto, Ontario  M5H 1T1 T (416) 967-7474F (416) 967-1947 CECO@conservationbureau.on.ca www.conservationbureau.on.ca

21. Questions?

22. 2007 CECO Report – Recommended Actions Codes and Standards • Prepare a plan for orderly consideration of energy efficiency in all renovations and retrofits • Raise minimum energy performance standards for six consumer products now PST-exempt • Introduce voluntary labelling for energy performance of buildings, and thereafter issue a regulation for mandatory labels Innovation and Education • Issue regulations to overcome restrictions that prohibit use of energy-efficient products or practices, e.g., CHP projects, clotheslines and solar collectors • Develop educational tools to enable customers to benefit from technologies such as smart meters

23. 2005-2007 Conservation Results: Highlights • Total peak demand reduction by Ontario electricity consumers by end of 2007: ~ 1,400 MW • Reported results from OPA-funded conservation programs since 2005: ~ 600 MW • LDCs report their (non-OPA-funded) conservationactivities contributed: ~ 260 MW • Other players reported contribution from activities: ~ 100 MW • Recommend that organizations delivering conservation should place more emphasis and resources on measuring and tracking results using standardized and transparent methods.