Power Play

Ontario is phasing out coal-fired power generation by the end of 2014. The options are to close these plants prematurely (wasting taxpayer capital expenditure) or to use alternative fuel. The province touts its Green Energy Act as “…expediting the growth of clean, renewable sources of energy, like wind, solar, hydro, biomass, and biogas…” So why is it replacing coal with another fossil fuel?

The feasibility of converting the province’s four coal-fired power plants to biomass has been explored. Plans are under way to convert Atikokan to wood pellets, with some new infrastructure required, such as pellet storage facilities and modifications to pulverizers and burners. Although there was talk of converting the other plants to biomass, they now face different plans.

The Ontario Ministry of Energy announced in late November 2010 that the Thunder Bay plant will convert to natural gas, requiring new infrastructure such as a pipeline to feed the boiler.

Ontario’s Long-Term Energy Plan, released by the same Ministry on the same day, says that in addition to the Thunder Bay conversion, the remaining coal-fired units at Lambton and Nanticoke will be shuttered or possibly converted to natural gas “if required for system reliability.” It also says, “Ontario will continue to explore opportunities for co-firing of biomass with natural gas…” Decisions will depend on “the ability to bring in fuel supply and the cost of conversion.”

On the supply front, no large-scale pellet plants are producing yet in Ontario, partly because they’re still waiting on the province’s wood supply competition. However, pellet producers from the rest of Canada are actively pursuing additional markets for their more than two million tonnes/year capacity because of depressed export markets.

On the cost side, it appears the plan is first to spend the money to put in natural gas infrastructure, and later, to consider the additional cost of replacing handling systems similar to those used for coal to co-fire biomass. This seems strange, given that a study of Nanticoke and Atikokan conversions, led by a University of Toronto researcher, estimated higher initial capital costs of conversion to natural gas than to 100% pellets. Why not convert to pellets and skip the additional cost of the natural gas intermediary stage?

European utilities co-fire pellets with coal or use 100% biomass. An exception is Denmark-based Dong Energy’s Avedøre plant, which co-fires wood pellets with natural gas and oil. However, a 2009 document by Foster Wheeler researchers states, “The difficult properties of the biomass fuels and their ashes are better compensated when wood is co-fired with coal instead of oil or gas…”

The wisdom of eliminating coal and replacing it with natural gas in Ontario is far from clear. A more practical solution might be to co-fire coal with biomass until the plants are obsolete. The poor transparency of the decision-making process has left the northern Ontario forest industry, the Canadian pellet industry, Ontario taxpayers, and other affected stakeholders in the dark.