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Energy Efficiency Trends in Canada, 1990 to 2004

Chapter 7. Electricity Generation Sector

Definition: The electricity generation sector includes the transformation of other forms of energy (fossil fuels, hydro, nuclear, etc.) into electrical energy by utilities and industrial generators.

Between 1990 and 2004, energy used to generate electricity increased by 30 percent, from 3002.0 PJ to 3903.0 PJ, while energy-related GHGs increased by 36 percent, from 94.6 Mt to 128.8 Mt. Due to a variety of circumstances, there was a break in the historical trend – a modest decrease in energy efficiency in 2003 and 2004. As a result, energy use rose by 30 percent between 1990 and 2004, instead of the 28 percent that would have occurred without the energy efficiency effect (Figure 7.1).

Figure 7.1 Energy Use, With and Without Energy Efficiency Effect, 1990– 2004 (index 1990 = 1.0)

As Figure 7.2 indicates, the following influenced the change in energy use and related GHGs between 1990 and 2004:

• a 23 percent increase in the amount of electricity generated led to a 712.5 PJ increase in energy and a corresponding 23.5 Mt increase in GHG emissions;
  
  
• structural changes in the electricity generation sector (the mix of electricity production by energy source) – in particular, a relative decrease in the share of hydro production combined with higher shares for more energy intensive natural gas-, biomass- and petroleum coke-fired generation – resulted in a 136.7 PJ increase in energy use and a corresponding 4.5 Mt rise in GHG emissions; and
  
  
• different from previous reports, the energy efficiency effect in the electricity generation sector led to a 51.9 PJ increase in energy use and a 1.7 Mt increase in energy-related GHG emissions. This result is due to a number of factors; most importantly, in some provinces, coal-fired and other plants used to meet peak demand were started and stopped more often than in the past, which impacted negatively on their performance efficiency.

Figure 7.2 Impact of Activity, Structure and Energy Efficiency on the Change in Energy Use, 1990– 2004 (petajoules)

Overall, as Figure 7.3 shows, the increase in energy consumption between 1990 and 2004 was largely driven by the increase in activity, or the amount of electricity generated to meet the needs of the end-use sectors. The structure effect, which varies with changes to the production mix, has also been trending upwards in recent years. This is because hydro's share of total production has been in decline since 1996. To meet increased demand for electricity, suppliers are using more energy intensive processes such as natural gas-fired generation. In addition, the energy efficiency effect, contrary to historical trends, has contributed to increases in energy use since 2003. In 2003, hydro reservoirs in some provinces had low water levels, which resulted in a shortfall in electricity production. To maintain production levels, older, less efficient coal plants were used more often than in the past, impacting on overall energy efficiency in the electricity generation sector. In 2004, water levels returned to normal, but fossil fuel plants were not operating at their optimal efficiency due to the frequent starts and stops in production required, in that year, to meet electricity demand in the end-use sectors.

Figure 7.3 Changes in Energy Use Due to Activity, Structure and Energy Efficiency, 1990– 2004 (petajoules)

As Figure 7.4 shows, GHG emissions from the electricity generation sector were 36 percent, or 34.2 Mt, higher in 2004 than in 1990. The increase was driven by higher energy consumption combined with an increase in the GHG intensity of the energy used. Compared with 1990, a relative increase in the production of electricity from natural gas and petroleum coke, and a relative decrease in GHG-neutral nuclear and hydro, resulted in a 5 percent rise in GHG intensity. However, this intensity effect is at its lowest level since 1997 because three nuclear reactors in Ontario, which had been shut down since the late 1990s, returned to service in 2003 and 2004, displacing electricity produced from coal and natural gas.

Figure 7.4 Impact of Energy Use and GHG Intensity on the Change in GHG Emissions, 1990– 2004 (megatonnes of CO₂ equivalent)