Alberta Electric System Operator reports more generation, lower pricing

CALGARY, ALBERTA–(Marketwired – Nov. 27, 2014) – Added generation this year and a well-managed system meant no significant grid outage issues and a lower wholesale electricity price than last year.

In 2014, the province will have seen a 3.5 per cent increase in electricity demand due to population growth in the cities and energy sector development. Despite the increased pressure on the province’s electricity system as a whole, the Alberta Electric System Operator (AESO) says the system ran reliably and the pool price remained competitive.

“This year our system continued to see increased demand for the fifth consecutive year as well as a couple of weather related incidents that could have really impacted the grid, but our team — as well as generation, distribution and transmission owners — worked to manage that demand and keep Alberta’s system reliable,” says Miranda Keating Erickson, Vice President of Operations with the AESO.

The AESO connected over 1,400 MW of new generation to the system in 2014, more than 2012 and 2013 combined.

The majority of generation added this year is fueled with natural gas. A large portion of that was from the Shepard Energy Centre that was energized this year and will contribute up to 873 MW to the system in the future. The next most significant source of generation was wind, with 300 MW of capacity added from what is now the largest wind farm in Canada, Blackspring Ridge.

“This was a big year of added generation due to two large scale projects and really helps when we think about our forecast for generation over the next 20 years, which tells us we will require another 11,900 MW by 2034,” Keating Erickson adds.

The healthy supply, paired with low natural gas prices this year, affected downward pressure on the wholesale price of electricity. The average price year to date is $51.76 per megawatt hour. That is down 38% from 2013 when the average price was $80.19/MWh. The 10-year average price is $68/MWh.

As an independent system operator, the AESO leads the safe, reliable and economic planning and operation of Alberta’s interconnected power system. The AESO also facilitates Alberta’s fair, efficient and openly competitive wholesale electricity market, which in 2014 had 184 participants and approximately $6 billion in energy transactions.