Natural Gas: Status, Challenges and Opportunities

Report
Natural Gas:
Status, Challenges and Opportunities for Heating
Fuels Systems in Ontario
Keith Boulton
Director Energy Conservation Strategy
Union Gas
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Status: Natural Gas Basics
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Natural gas is the cleanest burning conventional fuel:
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Domestically available:
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90% of natural gas’ energy value is delivered to customers
Customers today use 40% less natural gas than 40 years ago
Abundant:
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98% of natural gas consumed in Canada & US is produced in North
America
Efficient:
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45% less CO2 than coal
30% less CO2 than oil
Over 100 years of proven supply
Union Gas. For the energy.
Union Gas Distribution Area
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Union Gas. For the energy.
Status: Natural Gas in Ontario
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3.2 million residential, commercial and industrial customers
serviced by Enbridge Gas Distribution and Union Gas Ltd.
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In the residential market:
95+% of customers use it for heating
• 85+% use it for domestic water heating
• 20-25%% use it for cooking
• 20-25% use it for clothes drying
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Union Gas. For the energy.
Opportunities: Energy Efficiency
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Since 1997, through DSM programs, Union Gas has helped
customers:
• save 820 million cubic meters of natural gas
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1.6 million tones of CO2 emissions – the equivalent of taking more
than 295,000 cars off North American roads
Moving from a “programmatic” view of energy efficiency to
a “market transformation” view, ie:
• high efficiency furnaces
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Energy Star for new homes
Importance of full fuel cycle cost analysis
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right fuel for the right application
Union Gas. For the energy.
Emergence Of NA Shale Resource
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Shale reserves are helping to provide 100+ years worth
of supply
Union Gas. For the energy.
Shale Projection
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Union Gas. For the energy.
Future Supply into Ontario /
Dawn
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Union Gas. For the energy.
Opportunities: Fuel switching water heaters,
dryers, furnaces, ranges: 10 year potential
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1,100 MW (DD) to 6,400 MW (CD) saved
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6 million tonnes of GHG emission reduced (gross)
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Average cost per MW saved:
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$58,000 (CD) to $335,000 (DD)
10% (CD) to 60% (DD) of gas fired generation per MW
3% (CD) to 20% (DD) of renewable generation per MW
Union Gas. For the energy.
15.5% Transmission & Distribution Loss1
Gas Water Heater
Total gas water
heater efficiency:
49.0%*
84.5%
Full Fuel Life Cycle Cost Comparison
(.59 energy factor)
Electric Water Heater
Total electric water
heater efficiency:
32.3%
28.3%**
(.88 energy factor)
35.5% Generation Efficiency1
3.2% Transmission & Distribution Loss1
1.
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**
Natural Gas and Electric Residential Appliance Efficiency and GHG Emissions: A
Complete Fuel-Cycle Perspective
Assuming a 40 Gal natural gas water heater with an EF of 0.59
Assuming a 40 Gas electric water heater with an EF of 0.88
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Union Gas. For the energy.
Major Gas Fired Power Generation
Ontario Power Market Growth Phases
CES Coal Closure
Early Movers
Lennox Conversion
• SRCP 505 MW 2003
• BBPS 550 MW 2004
• IOL 95 MW
2004
• St. Clair 577 MW
2008
• GEC 1005 MW
2008
• Sithe Goreway 839 MW 2009
CES Ministerial Directive
• Portlands 550 MW
• EWC 84 MW
• HHGS 680 MW
• Thorold 236 MW
• York Region 393MW
2009
2009
2010
2010
2011
• 1050 MW 1998
• 1050 MW 2000
• Nanticoke Ignition 1998
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NUG Market
Union Franchise
• Union North 777 MW 1990-1997
• Union South 185 MW
1996
Enbridge Franchise
Other
Union Gas. For the energy.
Going Forward: Integrated Energy
Systems
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The majority of natural gas power generation in Ontario is
still confined to large scale centralized systems
Decentralized and integrated energy systems is the next
path to lead
Fundamental to this thinking is to move from the current
discussions of “smart grid” to a wider view of constructing a
“smart energy network”:
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CHP and Micro-CHP
Micro-grids
District Energy Systems
On-site integration of natural gas and renewables: passive solar
Union Gas. For the energy.
Smart Electric Grid
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Union Gas. For the energy.
A Vision for Integrated Community
Energy
Conceptual Scheme of the Smart Energy Network
Diagram from
Tokyo Gas
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Union Gas. For the energy.
Quality Urban Energy Systems of
Tomorrow
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The Canadian Gas Association was instrumental in
founding QUEST five years ago
The mission is to have every community in Canada
operating as an integrated energy system:
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Improve Efficiency
Optimize Exergy
Manage Heat
Manage Waste
Use Renewable Sources
Use Grids Strategically
Union Gas. For the energy.
Opportunities: Biomethane
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Biogas from anaerobic digestion and gas from landfill sites
can be upgraded to biomethane and injected into the
natural gas system
Enbridge & Union are working jointly to establish a
Biomethane Reference Gas Price:
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Enable the biomethane market by establishing appropriate
pricing and supply contracts
Looking to the future new “gasification” technologies can
further transform the market by allowing biomass to be
moved via pipeline
Union Gas. For the energy.
Natural Gas future in Ontario
Over the last decade, natural gas has often been referred to as
a “bridge fuel”—going forward it is a “foundation fuel”
• The transformation of Ontario to a lower carbon future requires
the flexibility of natural gas
• The significant infrastructure of the natural gas transmission
and delivery system in Ontario needs to be leveraged through
integration with community energy systems
• As “green gas” sources are developed (biogas and gasification
of biomass), the existing infrastructure can help in directly
delivering a lower carbon future
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Union Gas. For the energy.

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