SIXTH FLOOR, 900 HOWE STREET, BOX 250 ALANNA GILLIS VANCOUVER, BC CANADA V6Z 2N3 ACTING COMMISSION SECRETARY TELEPHONE: (604) 660-4700 Commission.Secretary@bcuc.com BC TOLL FREE: 1-800-663-1385 web site: http://www.bcuc.com FACSIMILE: (604) 660-1102 Log No. 36662 V IA E MAIL Gas.regulatory.affairs@fortisbc.com September 16, 2011 F ORTIS BC E NERGY – AES O FFERING P RODUCTS AND S ERVICES E XHIBIT A2-13 Mr. Shawn Hill Director, Regulatory Affairs FortisBC Energy Inc. 16705 Fraser Highway Surrey, BC V4N 0E8 Dear Mr. Hill: Re: An Inquiry into FortisBC Energy Inc. regarding the Offering of Products and Services in Alternative Energy Solutions and Other New Initiatives Commission staff submits the following document for the record in this proceeding: - FortisBC CDEA-IDEA Integrated Energy Solutions Presentation June 2011 – dated June 2011. Yours truly, Alanna Gillis /yl Enclosure cc: Registered Interveners (FEI-AES-RI) PF/FEI_AES Inquiry/A2-13_Submission
Integrated Energy Solutions in British Columbia CDEA - IDEA Conference June, 2011 Gareth Jones Director, Business Development
Overview • District Energy is becoming a more significant component of the FortisBC energy delivery mix • This presentation will describe: • FortisBC scope • Regulatory & legislation framework in British Columbia, • Integrated energy projects underway (including biomass & biogas) • Working to overcome development obstacles & enable progress to a low carbon future.
Forward looking statement By their very nature, forward-looking statements are based on underlying assumptions and are subject to inherent risks and uncertainties surrounding future expectations generally. Such events include, but are not limited to, general economic, market and business conditions, regulatory developments, weather and competition. FortisBC cautions readers that should certain events or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. For additional information with respect to certain of these risks or factors, reference should be made to the Corporation’s continuous disclosure materials filed from time to time with Canadian securities regulatory authorities. The Corporation’s disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Fortis Inc. in BC • Over one million energy customers • 135 communities across BC • Combined assets of $6.4 billion • Over 2,000 employees • Planned capital investment $2.5 billion over next five years • $1.03 billion invested since 2007 • Integrated energy solutions portfolio
FortisBC Integrated Energy Utility Model
BC Utilities Commission Act • " public utility " means a person,…, who owns or operates … equipment or facilities for the production, generation, storage, transmission, sale, delivery or provision of electricity, natural gas, steam or any other agent for the production of light, heat, cold or power to or for the public but does not include a municipality or regional district in respect of services provided by the municipality or regional district within its own boundaries, • Summary: As well as gas and electricity, thermal energy delivery is either a regulated utility or municipal utility business in British Columbia.
British Columbia Legislated Targets • Reducing BC’s GHG emissions by at least 33% below 2007 levels by 2020 and at least 80% below by 2050 8
BC Energy Customers • Two thirds of British Columbians are interested in incorporating low carbon energy into their home • 85% are willing to pay a premium (primarily up to 5%) for low carbon energy options • One half of BC residents believe we should offer low carbon energy • Strongest support for our low carbon energy offerings coming from residents age 18-34
BC Energy Infrastructure • Existing natural gas systems • Up to 100 years old • Interconnected • Scalable • Relatively low average cost • Relatively low commodity cost • Existing electricity grid • Supply anchored by low-cost legacy hydro dams
Transforming Thermal Energy Delivery in BC Energy System Evolution GHG Reduction Energy Cost Convergence Natural Gas Electricity DES/Alternative Energy Sources Geoexchange Biogas Solar
QUEST Vision “By 2050 every community in Canada is operating as an integrated energy system, and accordingly, all community development and redevelopment incorporates an integrated energy system.”
Integrated Energy Utility - Biogas
Biogas Supply Model FortisBC invests in “upgrading” plant and interconnection assets Metering, FortisBC Terasen Biogas Upgrading Monitoring, Transmission and Source Plant Odourizing Distribution System
Biogas vs. Biomethane • Biogas is gas generated from organic material • Raw biogas – typically 50% - 60% methane • Potential Sources: • Anaerobic Digester Gas • Landfill Gas • Biomethane: • Methane from a renewable source – “Upgraded Gas” Raw Biogas Biomethane 40% - 60% CH 4 >96% CH 4 Upgrade 30% - 50% CO 2 <2% CO 2 0% - 2% O 2 <0.4% O 2 0-2000+ ppm H 2 S Sulphur free
Catalyst Project • Partner Catalyst Power Inc • Digester Project • FortisBC Capital ~ $0.7M • Total Capital ~ $6.0 M • Average 120,000 GJ/year • FortisBC owns interconnect equipment only • Commissioned Sep 2010
Salmon Arm Project • Partner CSRD • Landfill Gas project • FortisBC ~ $2.2 Million • Total capital ~ $6.0 Million • Average 30,000 GJ/year • FortisBC owns upgrade equipment • Commissioned June 2010
Integrated Energy Utility - Thermal
Discrete to District Thermal Energy Systems Discrete = one building District = many buildings 20
Discrete Energy Systems Need: • Low carbon energy solutions • Technical & economic feasibility • Customer & Approvals Existing FortisBC discrete assets: • Approx 60 geo-exchange systems • Operating since 2007; approx $8 million assets Under development by FortisBC: • Numerous developer-based systems; $10 million capital • Numerous public sector-based retrofit systems; $80 million capital • Private sector-based retrofit systems; $12 million capital
Aquattro, Colwood BC Geo-Exchange Systems for Multi-Building Residential Development Type of Development: • 563 residential units total • 24 buildings Aquattro Site Energy System: Geoexchange loop fields by FortisBC Phased installation as community develops Environmental Benefits Reduced demand on BC’s electricity grid Savings of 2 tonnes of GHGs / year for each 2,000 square foot residential unit Geo-Exchange drilling 22
Public Sector Retrofits – School Districts • Low carbon energy delivery for all buildings • Challenges: • GHG reductions must be maximized • “All - in” costs must not exceed BAU • Varying degrees of retrofit complexity & cost • High effort to evaluate & optimize • Lead-in collaboration with Delta SD:
District Energy Systems Need: • Low Carbon Energy Solutions • Technical & Economic Feasibility • Customers & Approvals Existing Fortis District Energy: • Cornwall • Dockside Green Partnership Under development by FortisBC: • Two plant retrofits to biomass; $50 million capital • Two host-based NG cogen systems; $130 million capital • Five community-based systems; $100 million capital • Two developer-based systems; $30 million capital
Cornwall, Ontario Cornwall DES Heat provided to: • 2 hospitals, 6 schools • 7 other facilities Operational since 1995 CoGen Energy Centre: • Natural Gas • 5.5 MW electricity • 11 MW heat
Dockside Green, Victoria BC District Energy for Brownfield Re-development Energy System: 2.5 MW Biomass Gasification Plant 3.4MW natural gas back-up & peaking Also serves buildings outside development Environmental Benefits LEED Platinum 15 acre harbourfront Greenhouse Gas redevelopment Neutral – no net • 1.2 million sq. ft emissions residential • 150,000 sq. ft commercial/retail • 20,000 sq. ft. light industrial
Biomass Plant Retrofits Key considerations: • Fuel supply • Emissions • Reliability • Sizing to compete • Approvals
• Total CO 2 e (i.e. CO 2 equivalent) emissions 2007: about 780,000 tonnes • Business as usual to 2020: 1,200,000 tonnes, or 8.3 tonnes per capita • The City’s 2020 target of a 33% community -wide emissions reduction: • 257,000 tonnes against 2007 levels • 677,000 tonnes against business as usual • City & FortisBC district energy collaboration:
Kelowna City Centre • $30 million, 20 MWth • Key considerations: • Stakeholder interests • High grade heat source • Central vs. decentralized • Heating vs. cooling • Existing buildings vs. new • Congested utility corridors • Optimization: • Heating only hot water system • Decentralized peaking
Kelowna South Pandosy • $17 million, 10 MWth • Key considerations: • Stakeholder interests • Low grade heat source • Central vs. decentralized • Heating vs. cooling • Existing buildings vs. new • Congested utility corridors • Optimization: • Heating & cooling ambient system • Decentralized peaking
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