On July 23, Peter Gregg, the CEO of Ontario’s Independent Electricity System Operator (IESO) published an update on the status of the provincial grid and the outlook for the upcoming planning period.
As expected, the IESO is reworking many of the assumptions underlying its planning forecasts to take account of changes that became apparent in recent months following the onset of the COVID-19 pandemic. Even though the changes are significant, Mr. Gregg stressed that the system remains capable of meeting electricity requirements under all likely scenarios.
However, it remains necessary to seek out options for securing economic capacity in the years ahead. Mr. Gregg noted for example, that 2020 has been an unusually hot summer and that “We’re also seeing higher peaks because of the Industrial Conservation Initiative (ICI) hiatus.” (See article “GA frozen for Conservation Initiative participants” elsewhere in this issue.)
One of the chief concerns is Resource Adequacy. Mr. Gregg said, “[A] capacity gap will emerge in the mid-2020s. While capacity auctions have proven to be effective, they are not appropriate for all resource types, or in situations where risks or circumstances act as barriers to participation – feedback we consistently heard from stakeholders.”
He noted that “we remain committed to engaging stakeholders in the future on potential procurement tools.”
In preparing its updated forecasts of supply and demand, the IESO studied two potential scenarios. “The first can be characterized by a slower recovery, with demand not expected to reach 2019 levels until the end of 2025. In the second scenario, based on a shallower downturn and a less dramatic impact from the pandemic, demand is expected to reach 2019 levels by 2022.” Existing and available resources are sufficient to meet anticipated load in this time period, the IESO concludes.
A more complete update is expected when the IESO releases the next Annual Planning Outlook later this year.