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IESO Announces Results of Demand Response Auction

December 15, 2017

The Independent Electricity System Operator’s (IESO) 2017 demand response (DR) auction has resulted in increased consumer participation and lower prices.

The auction is an annual competitive process through which participating demand-side resources, such as residential, commercial and industrial consumers, are selected to be available to reduce their electricity consumption as needed, in this case during the summer of 2018 and winter of 2018/19.

“Demand response is an important resource that provides us with greater flexibility to respond to changing system conditions and needs,” said Leonard Kula, the IESO’s Vice-President of Planning, Acquisition and Operations, and Chief Operating Officer. “The auction enables us to acquire these resources in a competitive, cost-effective manner. These positive results also help to underscore the importance of the work being done to improve the overall efficiency of the electricity market through the Market Renewal Program.”

Thirty-five organizations were registered as auction participants, more than double the number from the 2015 auction. The successful proponents included six new participants who represent a mix of residential, commercial and industrial DR resources. This is the second year that residential homeowners, participating through an aggregator, were successful in the auction.

The average annual clearing price is $76,047/MW, a decrease of 1.6 percent from last year and 16.6 percent lower since the first auction in 2015.

The auction is part of the IESO's ongoing efforts to expand Ontario's DR capabilities and transition multi-year, contract-based DR to a more cost-effective, market-based platform. This year, target quantities for the auction were increased to enable DR resources from expiring contracts and programs to be procured through this more competitive platform. The 2017 auction cleared 570 megawatts (MW) for the summer commitment period and 712 MW for the winter commitment period.

This is the third DR auction that the IESO has held, with the first one in December 2015. The successful DR providers will be integrated into the electricity market along with generators and will help provide capacity when required to ensure the province's energy needs are met during peak hours.

The full list of successful participants is as follows:

Successful DR Participants

Summer Commitment Period

Winter
Commitment Period

ENERNOC LTD.

161

216

ENERSHIFT CORPORATION

168.4

205.8

NRG CURTAILMENT SOLUTIONS CANADA, INC.

67.3

92.8

GERDAU AMERISTEEL CORPORATION

72

72

TEMBEC ENTERPRISES INC.

40

40

RESOLUTE FP CANADA INC.

29

29

IVACO ROLLING MILLS 2004 L.P.

0

25

GC PROJECT LP

17.6

15.2

NRSTOR C&I L.P.

0

8.2

AMP SOLAR GROUP INC.

0

3

GERDAU AMERISTEEL CORPORATION -CAMBRIDGE

2.4

2.4

OHMCONNECT, INC

2

2

EMERA ENERGY LIMITED PARTNERSHIP

0

1

TORONTO HYDRO-ELECTRIC SYSTEM LIMITED

10

0

ALECTRA UTILITIES CORPORATION

1

0

Total

570.7

712.4

Additional information about the auction is available at http://www.ieso.ca/en/sector-participants/market-operations/markets-and-related-programs/demand-response-auction.

The next DR auction will be held in December 2018, for delivery of DR capacity between May 2019 and April 2020. In the coming year, the IESO will continue to evolve demand response as a fully integrated market resource through the Demand Response Working Group. In the future, once the Market Renewal Program has been implemented, demand response providers will have the opportunity to compete, through a capacity auction, against other capacity providers such as generation and imports to cost-effectively meet Ontario's electricity needs.

More information about Market Renewal is available at
http://www.ieso.ca/en/sector-participants/market-renewal/overview-of-market-renewal.

About the IESO

The IESO manages the province's power system so that Ontarians receive power when and where they need it. It plans and prepares for future electricity needs and works with its partners to guide conservation efforts. For more information, please visit www.ieso.ca.

IESO Media Contact:
John Cannella
416-506-2823
media@ieso.ca

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