Oil Crisis calls for innovation

In previous articles of this series, I suggested that high oil prices are a significant danger to electrical rate stability and we need to take energy self-sufficiency seriously. A big tilt towards high efficiency, low emission wood burning is a start. There are many other ideas, some with little or no cost that can make a big difference. You may find some items a little boring and technical so just skip over any items that don’t interest you.

2) Institute a province wide changeout of Christmas lighting to LED technology. Based on the figures in my article of January 07 entitled “The value of thinking small”, NB Power could save up to 35,000 barrel of heavy fuel oil a year ($2.8 M @ 80 / barrel). In addition greenhouse gases are reduced by 18,000 tonnes a year (worth $450,000 @ $25 / ton)

The cost of a changeout program would be about $5 million with a payback of less than two years. Saint John Energy made a start in this direction in November 2007

3) Advance legislation on light efficiency from 2011 to 2008.
Going from incandescents to higher efficiency lighting isn’t rocket science. It doesn’t cost a lot to government either. The government of Shawn Graham has indicated that it will legislate the issue in 2011. Why wait for 2011? Ireland is implementing legislation in 2009.

The value of conversion to higher efficiency lights is probably in the range of 188,000 barrels of heavy oil but could be more or less. The annual fuel savings to NB Power could be as high as $15 million. Subtract lower kWh sales of $9.3 million and you have a net benefit to NB Power of $5.7 million.

4) Introduce Electric Thermal Storage (ETS) furnaces or heaters similar to those used in Nova Scotia or Quebec. Supplying electricity poses some difficulties because the demand changes greatly over the course of 24 hours. There is very little demand at night when people are sleeping and much higher when everyone showers or is getting ready for work in the morning. Peak load timing may vary depending on the components of commercial or industrial load.

Utilities meet the varying load curve with the lowest cost generation first, such as nuclear or hydro, followed by coal, with natural gas, oil and diesel being the last to run. The sequence may vary somewhat depending on the cost structure of each utility. Not surprisingly, flattening the load curve can pay big dividends. The ETS device turns on and stores heat in a ceramic brick core during the night when the electrical load is low and releases heat as required during the day. Nova Scotia has implemented a time of use scheme where the power rates are much lower at night facilitating these devices.

Not every building will be converted off electric heat. This technology has a place in the mix of solutions. This EUB may wish to investigate.

5) Revisions to demand charges on commercial and industrial customers.

Utilities like NB Power introduced a demand charge to certain classes of customers to entice customer to flatten their load. In most cases the result has been less than satisfactory. The demand meter records the monthly peak and a charge per kW is added on the bill. Although the customer cannot mathematically reduce his demand below the average demand he is charged between 0 kW and the average demand.

A better approach would be to charge demand on only the difference between the peak and average monthly demand because that is what the customer could actually affect. Done with a higher $ / kW and a revenue neutral approach, it would actually encourage more customers to invest in load control. This may interest the EUB.

6) Review the specifications for wind turbines supply contracts.
The use of wind turbines has the potential to reduce the use of heavy fuel oil in the province. However, there are some technical problems to overcome before more than 10 or 15% of the system load can be supplied by this technology.

First, most types of wind turbines are induction motors, which cannot supply “vars” to the system and create stability problems under certain conditions. One company at least, Enercon, builds a synchronous generator with no direct coupling to the power system. Power electronics simulate the attributes of a typical power generator including var supply. This might permit higher system participation assuming the other issue of scheduling of the wind can be resolved to some degree.

Not the last or the least of ideas is the use of combined heat and power (CHP), which will be the subject of an article soon. But the journey of a thousand kilometers begins with the first step. We are ready to take that first step but in what direction? The Department of Energy has, as its prime function, the security of supply and the reasonable cost of the energy supplied to the citizens of New Brunswick. There is little spare oil production capacity in the world according to some OPEC sources.

Our department seems to hold the belief that the near doubling of crude oil prices has little significance and that the market system will soon correct the temporary supply problems. From the outside, it appears that the principal departmental activity is marketing the energy hub concept – exporting of power or energy.
The recent appointment of Shelley Rinehart, whose expertise is in marketing, would seem to confirm that.

The government is 17 months into its mandate without an up to date energy policy. The issue of rising oil prices and particularly heavy oil cost for NB Power may become an albatross around the neck of Shawn Graham, his own “Hurricane Katrina” on a scale that will mark his legacy.

Advertisements

3 comments

  1. Rbarter · January 24, 2008
  2. Royden Brien · January 28, 2008

    Roy,
    You introduced the term “vars” in your last article. Can you define the term. It is not in my texts.

  3. Shane LeClair · January 29, 2008

    Yes I would like to see more on net metering!!!
    It seems NB power has a small program for about 100kwh’s /month. (At least that’s the last I have seen.) But to save 100kwh that’s about $10 on my bill, hardly worth the investment. But allow the people of NB to produce renewable power with less restrictions and a competitive buy back rate and I think this could really catch on!! Just my 2 cents

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s