The Cost of Decarbonizing the Canadian Electricity System

76 Pages Posted: 31 Jan 2017

See all articles by Brett Dolter

Brett Dolter

University of Ottawa - Institute of the Environment

Nicholas Rivers

University of Ottawa - Graduate School of Public and International Affairs

Date Written: January 30, 2017

Abstract

Canada’s electricity sector is predominantly low-carbon, but includes coal, natural gas, and diesel fuelled power plants. We use a new linear programming optimization model to identify least-cost pathways to decarbonize Canada’s electricity sector. We co-optimize investments in new generation, storage and transmission capacity, and the hourly dispatch of available assets over the course of a year. Our model includes hourly wind speed data for 2281 locations in Canada, hourly solar irradiation data from 199 Canadian meteorological stations, hourly demand data for each province, and inter- and intra-provincial transmission line data. We model the capacity of hydropower plants to store potential energy and respond to variations in renewable energy output and demand. We find that new transmission connections between provinces and a substantial expansion of wind power in high wind locations such as southern Saskatchewan and Alberta could allow Canada to reduce electricity sector emissions at the lowest cost. We find that hydropower plants and inter-provincial trade can provide important balancing services that allow for greater integration of variable wind power. We test the impact of carbon pricing on Canada’s optimal electricity system and find that prices of $80/tonne render Canada’s coal-fired plants uneconomic.

Keywords: electricity, greenhouse gas emissions, linear programming, Canada, renewable energy, transmission

JEL Classification: C61, H23, Q54

Suggested Citation

Dolter, Brett and Rivers, Nicholas, The Cost of Decarbonizing the Canadian Electricity System (January 30, 2017). Available at SSRN: https://ssrn.com/abstract=2907924 or http://dx.doi.org/10.2139/ssrn.2907924

Brett Dolter (Contact Author)

University of Ottawa - Institute of the Environment ( email )

1 Stewart St.
Ottawa, Ontario
Canada

Nicholas Rivers

University of Ottawa - Graduate School of Public and International Affairs ( email )

75 Laurier Avenue East
Ottawa, Ontario K1N 6N5
Canada

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