Outlook Remains Positive Says Latest IESO 18-Month Outlook
June 23, 2015
The outlook for the reliability of Ontario's electricity system remains positive for the next 18 months. The latest 18-Month Outlook report from the Independent Electricity System Operator (IESO) covers the period from July 2015 to December 2016 and forecasts that there is adequate generation and transmission to supply Ontario's demand.
About 2,200 megawatts (MW) of new supply – mostly wind and solar generation – will be added to the province's transmission grid over the outlook period. By the end of the period, the amount of grid-connected wind generation is expected to increase by 1,500 MW to about 4,500 MW. The total distribution-connected wind generation over the same period is expected to be about 700 MW. Meanwhile, grid-connected solar generation is expected to increase to 380 MW, complementing the embedded solar generation capacity of about 2,200 MW located within distribution networks, by the end of the outlook period.
In May 2015, the IESO signed a 500 MW seasonal firm capacity sharing agreement with Hydro Quebec Energy Marketing. The agreement takes advantage of the provinces' complementary seasonal peaks – Ontario summer and Quebec winter – to support reliability and will be in effect for up to 10 years, starting December 2015, with Ontario supplying 500 MW of capacity to Quebec for the next two winter seasons.
With more typical summer weather expected this year, Ontario will return to experiencing annual peaks in the summer, which could reach as high as 24,700 MW under extreme weather conditions. However, the Industrial Conservation Initiative, growing embedded generation output and the impacts of conservation will continue to put downward pressure on summer peaks, mitigating any demand increases from a growing population and an expanding economy.
"Ontario's electricity system is well positioned to handle demand and supply variations, whether it is due to summer peaking or increased variable renewable generation," says Kim Warren, IESO's Vice-President of Market and System Operations. "Ongoing changes to our forecasting and control room processes over the past few years have put us in a good position and given us greater flexibility to handle these variations."
Ontario will continue to experience surplus baseload generation conditions during the outlook period, due to new generation coming online, as well as a decline in demand on the transmission grid due to conservation and embedded, local generation. Existing market mechanisms will be sufficient to manage these conditions.
The IESO regularly assesses the adequacy and reliability of Ontario's power system. The 18-Month Outlook is issued on a quarterly basis, in conjunction with the Ontario Energy Report, which highlights key trends in the energy sector. The 18-month outlook can be found by visiting ontarioenergyreport.ca or 18-Month Outlooks.
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. On January 1, 2015, the Ontario Power Authority amalgamated with the IESO. For more information, please visit www.ieso.ca.
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