Phasing out Natural Gas – not a simple, nor smart move, says OSPE’s Energy Task Force

Engineers know that protecting the environment is essential to promoting a sustainable and healthy lifestyle for current and future generations. That’s why the dedicated members who serve on OSPE’s Task Forces advocate for public policy that is guided by data and evidence. As problem solvers, engineers provide important insights on system planning, efficiencies and integration, total lifecycle costing and scenario analysis for sound policy making when it comes to combating climate change and mitigating its impact.

OSPE’s Energy Task Force sees that Toronto has become the latest Ontario city urging the provincial government to phase out natural gas power generation as soon as possible. Based on the analysis of our Energy Task Force, the Ontario Society of Professional Engineers affirms this is not the right move if the province wishes to reduce greenhouse gas (GHG) emissions. OSPE’s Energy Task Force Chair, Emily Thorn Corthay, P.Eng. recommends that carbon reductions focus on the most cost effective means – a key metric is dollar spent per tCO2e abated.  Ontario’s electricity grid is already over 95% emissions-free. It will cost much more per ton of carbon to remove the last ~5% of emissions from electricity, compared with focusing on other emissions-producing sectors.

The largest GHG-emitting sectors in Ontario are transportation at 35% of emissions, heavy industries (including iron, steel, and chemicals) at 24%, and buildings (residential and commercial) at 22%[1]. If Ontario wants to reduce emissions, it should focus on targeting these three sectors.  

Currently, the federal government is increasing the carbon tax on new natural-gas plants to discourage power companies from building them. This means that any natural gas plant that starts operating after 2021 will have to pay the carbon price on a higher portion of its emissions each year until 2030, the date by when they will pay the price on all emissions. Although this policy is understood and well-received, OSPE’s Energy Task Force believes it should go further and include all natural-gas plants, including those that were built prior to 2021. Current, gas-fired plants are required for reliability. Gas-fired plants do not operate much, so eliminating them will not reduce emissions much but will dramatically increase electricity prices. The reason is that all alternative clean technologies are much more expensive than gas-fired plants. This may not be the case by 2030 with increasing carbon taxes and developments in performance and cost-cutting of clean technologies. For example: renewables with battery storage to provide peaking capacity, in addition to energy. 

OSPE does recommend that the transition to phase out natural gas power generation by 2030 be addressed in detail as a scenario in the upcoming Long-Term Energy Planning Framework.

[1] https://www.cer-rec.gc.ca/en/data-analysis/energy-markets/provincial-territorial-energy-profiles/provincial-territorial-energy-profiles-ontario.html#:~:text=GHG%20Emissions,-Ontario’s%20GHG%20emissions&text=The%20largest%20emitting%20sectors%20in,9.3%20MT%20CO2e.

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