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Off Grid Energy Independence
Posted on October 24, 2019 by  & 

CGA Warns Switch to Electricity Could Raise Costs by $1.4 trillion

The Canadian Gas Association has released the study Impacts of Policy Driven Electrification in Canada. Prepared by ICF, the study assesses four scenarios that quantify what effects, requirements and costs electrification of roughly 40 to 50 per cent more of energy use would impose on generation capacity, electricity infrastructure, peak demand supply capability, emission reductions, and energy affordability. The study makes clear that:
Electrification will require a massive build out of new infrastructure
Currently only 20 per cent of Canada's energy requirements are met by electricity. Based on ICF analysis, fuel switching to electricity of an additional 40 per cent would require an expansion from 141 gigawatts (GW) of generating capacity today, to between 278 GW and 422 GW of capacity by 2050, depending on the electrification strategy deployed. That represents a tripling of generation capacity to meet peak demand on the energy system.
The infrastructure required will be enormously expensive
The expansion, along with the associated incremental costs of energy, electric technology adoption, new transmission infrastructure, and renewable natural gas (RNG), could increase national energy costs by between $580 billion and $1.4 trillion over the 30 year period between 2020 and 2050.
The expense for the average Canadian household will be significant
The cost is equivalent to increasing average Canadian household spending by $1,300 to $3,200 per year. The capacity requirements and associated costs could be significantly higher were it not for the study's aggressive, cost-conservative assumptions related to the improvement of electric technologies (e.g., heat pumps) and assumed steep reductions in the heating loads of residential and commercial buildings.
Environmental policy goals can be pursued at significantly lower cost through a multi-grid approach that integrates natural gas solutions with the electric system rather than an electric-only option
GHG reduction policies that entirely favour electricity over multi-grid approaches are significantly more costly (at $289 /tCO2 for electric alone vs $129 /tCO2 for integrated systems). Canada's existing natural gas and electricity systems and existing infrastructure working together can be optimized for a reliable, affordable, low emissions solution.
The goal of this report is to help better inform the public discourse on options for Canada's energy future. What is clear from the research is that the cost to electrify additional parts of the Canadian economy will come at tremendous cost. More importantly, pathways that leverage both natural gas and electricity systems can deliver important emission reductions much more affordably. For more information see the IDTechEx report on Distributed Generation: Minigrid Microgrid Zero Emission 2018-2038.
Canadian Gas Association
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