In a move to keep reducing its coal use, Nova Scotia Power (NSPI) announced March 28 that it will seasonally operate two of the four units at the Lingan power plant.
“We’re able to cut our coal use because of significant changes happening in our business – including a decrease in industrial load, more renewable energy on the system and increasingly stringent environmental requirements,” said NSPI President and CEO Rob Bennett. “Like any responsible business, we have to adjust to these changes so that we can continue to serve our customers and control costs.”
The seasonal operation will lead to one Lingan unit being shut down temporarily this spring, with another unit expected to shut down temporarily later this year. The company expects both units will still be needed during the coldest winter months.
In line with provincial renewable energy standards and emissions limits, Nova Scotia Power said it is significantly changing how it makes electricity. Progress over the 2006-2011 period has seen coal use cut from 80% of total generation to 57%. Over the same period, the use of cleaner natural gas has increased from 3% to 20%, and renewable energy has increased from 11% to 17%.
Lingan was commissioned between 1979 and 1984 as a coal-fired facility. It originally used Nova Scotia coal, but has burned mainly imported coal since the closure of the local Cape Breton Development Corp. mines in 2001. The station’s four units have a total production capacity of 640 MW.
Utility ratchets down emissions due to regulatory restrictions
NSPI is a unit of Emera Inc. (TSX: EMA), which explained some of the background behind increased renewable energy targets in a March 2 financial statement.
“On May 19, 2011, the Nova Scotia Government approved The Electricity Act (Amended) to facilitate the eligibility of energy from the Lower Churchill Project in Labrador as a resource for meeting Nova Scotia’s renewable electricity targets,” Emera said. “The amendment requires regulations to be developed that increase the percentage of renewable energy in the generation mix from the planned 25 percent in 2015, to 40 percent by 2020.”
Greenhouse gas emissions from NSPI facilities have also been capped beginning in 2010 through to 2020. The regulations allow for multi-year compliance periods recognizing the variability in electricity supply sources and demand. Over the decade, the caps will be achieved by a combination of additional renewable generation, import of non-emitting energy, and energy efficiency and conservation, Emera wrote.
In 2011, Environment Canada announced proposed regulations for a new national CO2 framework for the electricity sector in Canada. These proposed regulations would apply to new coal-fired units; and existing coal-fired units that have reached the end of their deemed economic life of 45 years after commissioning. These proposed regulations will be effective July 1, 2015.
The province of Nova Scotia’s existing greenhouse gas regulations require reductions in NSPI’s emissions similar to those reflected in the federal framework. NSPI is engaged with federal and provincial agencies in reviewing the implications of this federal framework and its alignment with its current operating plans under existing Nova Scotia regulations, Emera noted.
NSPI already controlling coal units for SO2 and NOx
NSPI completed its capital program of retrofitting low-NOx combustion firing systems on six of its seven pulverized coal units in early 2009 at a cost of C$23.3 million. NSPI now meets the NOx emission cap of 21,365 tonnes per year established by the Nova Scotia government effective 2010. These investments, combined with the purchasing of low-sulfur coal, allows NSPI to meet the provincial air quality regulations. NSPI will meet ever-reducing SO2 emission cap requirements through the use of a blend of lower-sulfur-content solid fuel.
NSPI, created in 1992, is a fully-integrated regulated electric utility and the primary electricity supplier in Nova Scotia. NSPI provides electricity generation, transmission and distribution services to about 493,000 customers. The company owns 2,374 MW of generating capacity, of which around 52% is coal-fired; natural gas and/or oil comprise another 28%; and hydro and wind total 20%.
In addition, NSPI has contracts to purchase renewable energy from independent power producers (IPPs). These IPPs own 229 MW, increasing to 259 MW in 2012, of wind and biomass generation capacity. A further 83 MW of renewable capacity is being built directly or purchased under long-term contracts by NSPI and is expected to be in service by the end of 2013, the Emera statement noted.
A substantial portion of NSPI’s coal and petroleum coke supply comes from international suppliers. The company has entered into fixed-price and index price contractual arrangements for coal with several suppliers as part of the fuel procurement portfolio strategy, Emera wrote. All index-priced contractual arrangements are matched with a corresponding financial instrument to fix the price. The approximate percentage of coal and petcoke requirements contracted as of Dec. 31, 2011, are as follows: 2012–94%; 2013–32%; and 2014–15%.