gdpe0740icr canada power market outlook to 2030 sample 1-2 ... · canada power market outlook to...

REFERENCE CODE GDPE0740ICR | PUBLICATION DATE OCTOBER 2014

CANADA POWER MARKET OUTLOOK TO 2030, UPDATE 2014 – MARKET TRENDS, REGULATIONS,

AND COMPETITIVE LANDSCAPE

This report is available on ASDReports.com: https://www.asdreports.com/ASDR-24161

CANADA POWER MARKET OUTLOOK TO 2030, UPDATE 2014 – MARKET TRENDS, REGULATIONS, AND COMPETITIVE LANDSCAPE

Executive Summary

Outlook of Canada’s Power Sector

Renewable power remains one of the fastest

growing sectors in Canada’s power sector.

Between 2000 and 2013, the historic period

covered in this report, the country’s renewable

power capacity grew at a Compound Annual

Growth Rate (CAGR) of XX%, while renewable

power generation grew at a CAGR of XX%. Both of

these rates were the highest among all types of

energy used in Canada, such as thermal power,

hydropower, nuclear power, and renewable power.

Renewable power technologies went from

representing only XX% of the total installed

capacity in 2000 to constituting XX% in 2013. The

following figure shows the shares of various fuel

types in the total installed capacity as of 2013.

Power Market, Canada, Cumulative Installed Capacity by Fuel Type (%), 2013

Hydropower

Gas (thermal)

Nuclear

Coal (thermal)

Wind (onshore)Oil (thermal) Other renewables

Source: GlobalData, Power Database [Accessed on September 16, 2014]

Baseload power demand in Canada is met through

hydropower, thermal power from gas, and nuclear

power. The importance of nuclear power is steadily

declining, but that of gas-based thermal power

generation is growing. A few large hydropower

projects are in the pipeline, and are expected to

increase hydropower capacity from XX Gigawatts

(GW) to XX GW by 2030. As a percentage of

contribution to the total installed capacity, this will

be a decline from the present XX% to XX%, which

is expected to be replenished by an increase in

renewable energy sources. The government is also

strongly emphasizing the reduction of energy

consumption. So, while Gross Domestic Product

(GDP) has grown by XX% during this period

electricity consumption has grown only XX%, as

depicted in the following figure alongside the

forecast growth in GDP until 2019.

Power Market, Canada, GDP ($tr) and Annual Power Consumption (TWh), 2000–2019

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Annu

al p

ower

con

sum

ptio

n (T

Wh)

GD

P ($

tr)

GDP (constant prices) Annual power consumption

Source: GlobalData; IMF, 2014



Introduction

2 Introduction

Canada is a developed country with an economy that is primarily dependent upon its

manufacturing, mining, and service sectors. It has shifted over the last century from a largely rural

economy into one that is primarily industrial and urban. In 2013, the service sector contributed an

estimated XX% of Canada’s Gross Domestic Product (GDP), followed by the industrial sector with

XX% and the agricultural sector with XX% (CIA, 2014). Canada is also a significant exporter of raw

goods, which is rare for a developed country. It exports motor vehicles and parts, industrial

machinery, aircraft, telecommunications equipment, chemicals, plastics, fertilizers, wood pulp,

timber, crude petroleum, natural gas, electricity, and aluminum.

Canada’s major export partners are the US and the UK. The 1989 US–Canada Free Trade

Agreement (FTA) and the 1994 North American FTA have contributed to its economic integration

with the US, which is Canada’s principal trading partner. Canada is the US’s largest foreign

supplier of energy.

Canada is a member of the Organization for Economic Co-operation and Development (OECD)

and the G8. It has been a member of the World Trade Organization (WTO) since January 1, 1995.

The WTO is the cornerstone of Canadian trade policy and provides a forum for the advancement of

relations between established and potential global trading partners. Between 2009 and 2010,

Canada registered one of the largest increases, in real terms, in Official Development Assistance

(ODA), a measure through which developed countries promote economic development in

developing countries.

Between 1993 and 2007, Canada benefited from steady economic growth. In 2008, its economy

went into decline, due to the global economic crisis. Its export-oriented economy was adversely

affected by the recession of 2008 and 2009, recording a GDP decline of XX%, in 2009. After 2009,

the major banks emerged from the financial crisis due to its tradition of conservative lending

practices and strong capitalization. The economy recovered in 2010, with GDP growing at XX%. In

2011, its GDP growth rate decreased to XX% and was even lower in 2012, at XX%. However,

there was a slight improvement in 2013, with GDP growth of XX% being recorded (IMF, 2014).

The petroleum sector is rapidly becoming a major economic driver in Canada, and its growth is

expected to be driven by increasing exports of energy and energy-related products, including oil,

gas, electricity and petroleum.



Introduction

Natural Resources Canada (NRCan) is the ministry responsible for the development of policies and

programs related to natural resources, energy, minerals, metals, forests, earth sciences, mapping

and remote sensing. The National Energy Board (NEB) and the Canadian Nuclear Safety

Commission (CNSC) are Canada’s two independent regulators, and the Canadian Electricity

Association (CEA) is its national forum for electricity business. Those electric utilities that are

involved in the generation and Transmission and Distribution (T&D) of electricity are members of

CEA.

2.1 GlobalData Report Guidance

The executive summary captures the key growth trends in the Canadian power market.

Chapter three provides a snapshot of the key parameters that affect Canada’s power sector, as

well as key points about the power market.

Chapter four provides analysis of Canada’s power market, including the market shares of the

leading power generation companies, a ratio analysis of the leading power utilities, and an

analysis of electricity consumption.

Chapter five details the regulatory structure of the power market and the inward foreign

investment scenario.

Chapter six provides information on Canada’s cumulative installed capacity and annual

generation trends, by individual generation source.

Chapter seven describes the power T&D infrastructure in Canada and provides information on

interconnectors with neighboring countries. The section also covers electricity imports and

exports and upcoming grid-related projects in Canada.

Note: From 2013, the report provides actual or estimated data depending upon the availability of

information at the time of writing.



Market Analysis

4.4.1 Consumption by Sector, 2013

The industrial sector was the largest consumer of electricity in Canada in 2011 and 2012. This

trend continued in 2013, with the industrial sector accounting for the largest slice of annual

consumption, estimated at XX%. The residential sector came next, with an estimated consumption

share of XX%. Trade and commercial institutions are estimated to have contributed XX% to total

power consumption in 2013. Agriculture, transport and other smaller sectors are estimated to have

together been responsible for the remaining XX% of total power consumption in 2013.

Figure 7: Power Market, Canada, Power Consumption by Sector (%), 2013

Industrial

Residential

Trade, commerce, and other services

Agriculture and fisheries

Transport

Other

Source: GlobalData

Table 8: Power Market, Canada, Electricity Consumption by Sector (%), 2013 Sector Share

Industrial

Residential

Trade, commerce, and other services

Agriculture and fisheries

Transport

Other

Source: GlobalData



Capacity and Generation Overview

6.2 Canada, Power Market, Cumulative Installed Capacity and Annual Power Generation, 2000–2030

Cumulative installed capacity is expected to grow at a CAGR of XX% during the 2014–2030

forecast period to reach XX GW. The relative shares held by hydropower and renewable sources

are expected to be about XX% and XX% in 2030, and the installed capacity of both sources is

expected to amount to XX GW and XX GW, respectively. The reason for this is the increased focus

on emission-free electricity generation. No major increase in thermal power is expected, because

of a shift in focus away from coal-fired power plants to natural gas-fired power plants as a source

for power generation. In 2030, Canada’s installed thermal capacity is expected to be XX GW. As a

contribution to total capacity, this is expected to amount to XX%. Coal, gas and oil are expected to

hold respective shares of XX%, XX%, and XX% of total installed thermal capacity. The share of

total capacity contributed by nuclear power is expected to be about XX%.

Between 2014 and 2030, overall electricity generation is expected to increase at a CAGR of XX to

reach XX TWh. Hydropower generation is expected to reach XX TWh in 2030, contributing XX% of

total electricity generation. Renewable power generation is expected to increase at a CAGR of

XX% during the 2014–2030 forecast period, because of a large number of upcoming projects.

Thermal generation is expected to decrease at a negative CAGR of XX% during the forecast

period, due to lower capacity utilization. The thermal generation shares held by coal, oil and gas in

2030 are expected to be XX%, XX%, and XX%, respectively. Nuclear power generation is

expected to decrease as well during the forecast period, at a CAGR of XX%, because of the

decommissioning of some existing plants. Only two nuclear plants are expected to come online

during the forecast period.



Capacity and Generation Overview

Figure 9: Power Market, Canada, Cumulative Installed Capacity (GW) and Annual Power Generation (TWh), 2000–2030

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

Ann

ual p

ower

gen

erat

ion

(TW

h)

Cum

ulat

ive

inst

alle

d ca

paci

ty (G

W)

Cumulative installed capacity Annual power generation

Source: GlobalData, Power Database [Accessed on September 16, 2014]


Appendix


9 Appendix

9.1 Market Definitions

9.1.1 Power

Power refers to the rate of production, transfer or energy use, usually related to electricity. It is

measured in Watts (W) and often expressed in kilowatts (kW) or Megawatts (MW). It is also known

as real power or active power.

9.1.2 Installed Capacity

Installed capacity refers to the generator’s nameplate capacity as stated by the manufacturer, or

the maximum rated output of a generator under given conditions. It is given in Megawatts (MW) on

a nameplate affixed to the generator.

9.1.3 Electricity Generation

Electricity generation refers to the process of generating electricity from other forms of energy. It

also refers to the amount of electricity produced, expressed in Gigawatt hours (GWh).

9.1.4 Electricity Consumption

Electricity consumption is the sum of electricity generated, plus imports, minus exports and

Transmission and Distribution (T&D) losses. It is measured in Gigawatt hours (GWh).

9.1.5 Thermal Power Plant

A thermal power plant is a plant in which turbine generators are driven by burning fossil fuels.

9.1.6 Hydropower Plant

A hydropower plant is a plant in which the turbine generators are driven by falling water.

9.1.7 Nuclear Power

Nuclear power is the energy released from the fission of nuclear fuel in a reactor.


Appendix


9.1.8 Renewable Energy Resources

Renewable energy resources are those that provide energy that is naturally replenished but limited

in the amount of energy available per unit of time. Biomass, geothermal, solar, small hydropower

and wind are examples of renewable resources.


Appendix


9.2 Abbreviations

Table 30: Abbreviations AC Alternating Current

AECB Atomic Energy Control Board

AESO Alberta Electric System Operator

BP British Petroleum

CAGR Compound Annual Growth Rate

CCGT Combined Cycle Gas Turbine

CEA Canadian Electricity Association

Ckm Circuit Kilometer

CNSC Canadian Nuclear Safety Commission

DC Direct Current

ecoEII EcoEnergy Innovation Initiative

FDI Foreign Direct Investment

FiT Feed-in Tariff

FTA Free Trade Agreement

GDP Gross Domestic Product

GW Gigawatt

GWh Gigawatt hour

HQ Hydro-Québec

IESO Independent Electric System Operator

km Kilometers

kV Kilovolt

kW Kilowatt

MW Megawatt

NAFTA North American Free Trade Agreement

NEB National Energy Board

NGX Natural Gas Exchange

NRCan Natural Resources Canada

ODA Official Development Assistance

OECD Organization for Economic Co-operation and Development

OPG Ontario Power Generation

PHWR Pressurized Heavy Water Reactors

PV Photovoltaic

T&D Transmission and Distribution

TWh Terawatt hour

WTO World Trade Organization

Source: GlobalData


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