Ontario Smart Grid Opportunities in the Electrical Utility Sector - MaRS Market Insights

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To become smart grid leaders, Ontario needs to effect a transformation in a risk-averse environment. To do so, the province needs not only to advance its electricity infrastructure but also embrace a long-term and global vision. This breakfast panel brings together diverse energy-sector stakeholders, including utilities, key industry players, government authorities, regulatory bodies and innovators. Does an opportunity exist for Ontario utilities that implement intelligent operations to leverage that expertise into other markets? Can synergy between innovation and the electricity sector be created to support these practices? How much are we open to change? http://www.marsdd.com/events/details/ontario-smart-grid-opportunities-electrical-utility-sector/

Text of Ontario Smart Grid Opportunities in the Electrical Utility Sector - MaRS Market Insights

  • 1. Ontario Smart Grid Opportunities in the Electrical Utility Sector: Getting out from Behind the Meter Brian Warshay Research Associate Lux Research, Inc. January 25, 2012

2. Lux Research ! We focus on emerging technologies in the chemical, material, and cleantech sectors ! We interview and evaluate emerging technology companies ! Support Technology Monitoring and Market Intelligence Qatar Science ! We have 12 practices in: and Technology Park ! Smart Grid & Grid Storage ! Electric Vehicles & Alternative Fuels ! Solar Components & Solar Systems ! Bio-based Chemicals & Materials Suntech solar factory, China ! Green Buildings ! Water, and others ! Oces in New York, Boston, Singapore, Tokyo, and Amsterdam with ~70 employees: ! 67% scientists, 33% business analysts Svalbard Global Seed Vault, Norway 3 3. Lux Smart Grid Intelligence Key issues addressed ! Smart Grid & Grid Support How will utilities implement advanced metering infrastructure? Is there a viable business model for demand response? How can network security be maintained on the power grid? How will utilities deal with grid-connected vehicle charging? ! Grid Storage Which technologies t which applications? Where on the grid will grid storage be located? How will storage integrate with renewable energy and other grid applications? ! Fuel Cells Which fuel cell technologies are most cost eective? For which applications are fuel cells most viable? 4 4. Global Regulatory and Investment Overview ! What is driving smart grid technology adoption? ! Why are smart grid technologies important to utilities? ! Where is the investment? ! How do regulations incentivize or constrain the market ! How is Ontario doing? 5 5. The Smart Grid U"lity back-oce Distribu"on network End-user 6 6. Smart Grid 1.0 giving way to Smart Grid 2.0 Smart Grid Device Sales Data Rates Source: Lux Research 7 7. Smart grid tools and data benet utilities Smart Grid Tool Data Quan"ty Data Value Benet to U"li"es Smart meters High Low Reduced monitoring costs; point-of-use monitoring Demand management & response High Medium Peak shaving Voltage & VAR OpKmizaKon High Medium Peak shaving; higher eciency Fault detecKon, isolaKon, & repair Low High Improved reliability & safety Sensors High Low Improved monitoring Grid storage Medium Medium Dispatchable renewable energy; outage buer 8 8. Smart Grid 2.0s thirst for data drives adoption Global Utility Investment Source: Lux Research 9 9. Investment and acquisitions in Smart Grid Investments in 2010 & 2011 by Technology M&A in 2010 & 2011 by Technology Source: Lux Research Data through June 30, 2011 10 10. Policies directly and indirectly drive adoption Policy Approach Region(s) Incen"ves & Mandates Smart meter mandates and grants Direct European Union (EU) & USA IncenKves for distributed generaKon Direct Global Market Restructuring Time-of-use electricity pricing Direct Global Pay-for-performance Direct USA Feed-in-taris and net-metering Direct Global Redening as asset class for energy storage Direct USA (California) Renewable energy credits Indirect USA Renewable porVolio standards Indirect Global Carbon Management & Security Emission regulaKons Indirect Most developed naKons ReKrement of fossil/nuclear power plants Indirect USA, Europe, Japan Source: Lux Research 11 11. while politics constrain progress Policy Resul"ng constraint Region(s) Regulatory uncertainty Direct USA Cross-border interconnecKon permiYng Direct North America; EU and funding Short-term investment perspecKve Direct USA Disconnect between smart grid Direct Deregulated uKlity markets beneciaries an investors UKliKes are highly regulated Indirect Global Lack of standards for interconnecKon Indirect Global Status quo inerKa Indirect Global Source: Lux Research 12 12. Grid Smarts in Ontario ! Regulatory and Infrastructure Support 2.6% of Ontarios electricity is from wind, a 40% increase Ontario has a Feed-in-Tari for renewable energy projects Ontario has time-of-use rates and 500 MW of demand response Nearly 100% of Ontarios meters are smart ! Demonstration Projects Energate pilot allowed customers to control and monitor energy consumption along with consumer-connected demand response Enbalas projects in North America pave the way for frequency regulation 13 13. Summary and outlook ! What is driving smart grid technology adoption? Though smart meters will lay the smart grid foundation, it is the resulting inux of data that will drive new markets ! Why are smart grid technologies important to utilities? Smart grid technologies align with the goals of utilities to improve reliability, safety, and reduce costs ! Where is the investment? Although later stage private investment and M&A continue to streamline the market, government funding will remain imperative for adoption ! How do regulations incentivize or constrain the market? While regulations indirectly and directly drive adoption, antiquated regulatory frameworks are slow to adapt new infrastructure ! How is Ontario doing? Ontario is equipped with the technology and infrastructure to rapidly expand its smart grid capabilities, but regulatory guidance will need to remain exible and adaptable to meet the goals in the Long-Term Energy Plan 14 14. Thank You Brian Warshay Research Associate +1 (917)484-4872 Brian.Warshay@luxresearchinc.com www.luxresearchinc.com 15. Market Potential for Smart Grid in Canada Alex BettencourtMaRS Market InsightsManaging Director 16. Our MissionSmartGrid Canada is a national association of public and privateorganizations including utilities, vendors, technology and serviceproviders, academics and other industry leaders.Together, the members of SmartGrid Canada are united by apassion and dedication to building a more innovative, reliableand cost-effective electricity delivery system for the benefit ofall Canadians. 17. SmartGrid Canada MembershipSmart Grid Canada is a national association of public and private organizations including utilities,vendors, technology and service providers, academics and other industry leaders. Utilities Technology Services & Academia R&DTogether, the members of Smart Grid Canada are united by a passion and dedication to building a moreinnovative, reliable and cost-effective electricity delivery system for the benefit of all Canadians. 18. The linked image cannot be displayed. The le may have been moved, renamed, or deleted. Verify that the link points to the correct le and location. 19. 6 reasons why smart grid is important toCanadians & the economy 20. A Smart Grid is essential to Canadianeconomic prosperity.Over 60% of our GDP now comes from industries and servicesthat run on electricity; in 1950, the figure was only 20%. Since1980, over 85% of energy growth has been supplied by electricity.Manhattan Institute:The Million-Volt Answer to Oil 21. Our infrastructure is aging as weupgrade it we should be lookingforward. 22. Conservation is the cheapest way toaccommodate load growth. 23. A clean economy requires renewableenergy, which in turn, requires a smartgrid. 24. Outages cost money smart grid canimprove reliability.Power outages and interruptions cost Americans at least $150billion each year - about $500 for every man, woman and child. DOE,The Smart Grid: an Introduction 25. Smart grid sets the foundation forfuture technology electric vehicles,etc. 26. Key Areas of Competitive Advantage1. Time of Use Rates2. Sustainable Remote Communities3. Renewable Integration on Distribution System 27. Time of Use RatesCALIFORNIA ONTARIOGood Consumer MassTelecom OverCollaboration &ImplementationRugged TerrainCommunication Time-of-Use Rates 28. CANADA FACTSOpportunities for Smart & SustainableCanada has over 300 remoteCommunities 34 million Population communities with a total populationof 200,000 mostly on diesel. Population Density Rank 230th Opportunity for Canada to reduce its own cost of powering these communities while solving the problems and selling to the developing world. 29. Sustainable Remote Power ProjectsHydrogen Assisted Renewable PowerWind-Diesel StorageCommunity Energy ManagementHydrokinetic Turbine 30. Coming Generation GapSignificant resource gap that will need to befilled over the coming 10 years 31. Distributed Renewable GenerationVoltage RegulationEnergy StorageEnergy ManagementMarket InnovationProtections & ControlOntario has the some of the highest penetration of renewablegeneration on its distribution system (up to 10MW/connection) 32. National Technology Road Map 33. Closing ThoughtsThe First Era:Founded on1850 to 2000 Growth 34. Closing ThoughtsThe Second Era: Founded on2000 to .Sustainment 35. MaRS Market Insights SmartGrid Canada www.sgcanada.orgFor more information, contact:Alex BettencourtManaging DirectorSmartGrid Canadaalex.bettencourt@sgcanada.org 36. Implemen"ng Smart Grid .. U"lity Best Prac"ce Presented to MaRS Insight PanelJanuary 25, 2012By: John Mulrooney 37. What is Best Prac"ce ?? A Best Prac"ce is a method or technique that has consistently shown results superior to those achieved with other means, and that is used as a benchmark. Best Prac"ce come from experience. 38. Ontario LDCs Years of Experience developing U"lity Best Prac"ce Planning Engineering Capital and OM&A Management OperaKons 39. Best Judge of Utility Best PracticeAt the end of the day, there is only one judge of BestPractice for the LDCOur Regulator .TheOEB Slide 40 40. Smart Grid Overarching Must Haves 1. Smart Grid IniKaKves must benet the Customer. 2. Smart Grid IniKaKves get no free ride . I will explain. 41. Best Prac"ce To Iden"fy SG Ini"a"ves 1.Best PracKce s

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