Tom: Okay. Good afternoon and welcome, everyone. Thank you for joining us. Thank you for coming back to join our Energy Innovators Roundtables. My name is Tom Timmins and I lead the energy group at Gowling WLG. I sit in Toronto. We are joined today by Brandy Giannetta, who is one of the deep thinkers on policy, the Senior Director, Ontario and Atlantic Director, for the Canadian Renewable Energy Association, and by Travis Lusney, the Manager of Procurement and Power Systems at Power Advisory. Before we get started I just want to provide a few thoughts. This is a continuation of our Roundtable Breakfasts which we've had for a number of years now. They used to be breakfast. We've decided to hold them in the afternoon in order to facilitate people from across the country joining, since we're all on Zoom now, we're all virtual facsimiles of our former selves. The goal of these roundtables was initially to get people into a room, in a relatively small group, to have kind of in depth discussions about interesting energy matters. Matters affecting our energy system in Canada and to kind of facilitate an intimate discussion. In the old days, pre-COVID, the discussion was not recorded and it was Chatham House Rules. Today's discussion, just so everyone knows, will be recorded and so obviously Chatham House Rules cannot apply, and as they say on TV, anything you say can and will be used against you. But it doesn't normally get that exciting. Everyone is welcome to ask questions. There's a question and answer icon. I would be blown away if anyone on the call today didn't know how to use Zoom already but there is a question and answer icon at the bottom and you're all welcome to ask questions. Without further ado, thank you everyone for joining. We're going to try and cut off a little bit early. We have an hour and a half scheduled. I think we'll probably end up at around an hour and 15 minutes or so. We'll try and cut off a little bit early. If you do have questions that we don't get to answering, I encourage you, please feel free to reach out to me or to Brandy or to Travis, depending on the relevant question. If you have feedback or any further ideas regarding these roundtable sessions, we're more than open to that, and very much welcome hearing back from people. We've had some really great ideas come in over the years and it's been a really good process. So without further ado, Brandy, I'm going to pass the torch over to you and put myself on mute, and I'm curious to hear your initial thoughts. Our topic today, of course, is energy storage and I look forward to hearing your initial thoughts. Over to you.
Brandy: Great. Thanks so much, Tom, and thanks very much to Gowling for having me here today as a guest speaker, and most of you for your post-lunch attention for tuning in. So, thanks so much for that. I'm looking forward to the discussion today. Just quickly I'm going to cover a few things at the start, to sort of set the stage about where I'm coming from in this discussion, which is very much from the perspective of renewable energy and the relationship with energy storage in the context of our intro to a new industry association, being the Canadian Renewable Energy Association. I'm going to talk a little bit about the impacts of wind and solar energy on the grid. What we know about that today and the increased need for flexible resources, as a result of that increased variability, that renewables have brought to the grid and ultimately wind energy and solar energy as solution providers particularly when we pair those with energy storage, since energy storage is such an important and integral part of capitalizing on the solutions that renewables can provide. So I'm going to try and do all that in the next 5 to 10 minutes or so before we get into the formal Q&A. But again, just to try to set the stage of where I'm coming at to this discussion.
Canadian Renewable Energy Association, or CanREA, I'll use the acronym probably frequently throughout the dialogue today. We are a new industry association, as I mentioned. We are a product of what was the Canadian Wind Energy Association and the Canadian Solar Industries Associations. So if you're familiar with this space here in Canada, we're known as CanWEA and CanSIA, up until July 1 of this year. So on July 1, 2020 we did merge the two organizations to create the Canadian Renewable Energy Association, now operating as CanREA. So we are a national industry association, much like our predecessors were, but we represent about 250 members in the wind energy, solar energy and energy storage spaces that are active here in Canadian markets. We're, as an association, most active in Alberta and Saskatchewan, Ontario, Quebec, Nova Scotia and across the Federal advocacy side of things. Our mandate, as I noted earlier, covers the application of wind and solar as renewable sources as well as energy storage. We do that at multiple scales so it's quite representative of the industry in Canada. So utility scale wind and solar farms, residential applications, battery storage, etcetera, we've got the full gamut of technology represented within our advocacy mission. We do have a vision at the Association to ensure that wind, solar and energy storage play a central role in transforming Canada's energy mix. So we're really honed in and focused on that energy transition in Canada. Me, personally, I've been the Senior Director, previously at CanWEA on the wind side for about 7 years in Ontario, specifically focusing on policy and regulatory affairs for Ontario wind and that brought me into many independent electricity system operator forums like the Stakeholder Advisory Committee, the Governance and Decision Making Committee as well as the Energy Storage Advisory Group and now as CanREA I'm going to continue that work and also focus on Federal advocacy as well as Atlantic Canada. So just a little bit of everything except the West Coast. We've got a couple of events coming up that I hope to talk about too, that really highlight the energy storage side of things, so I'm talking about a webinar in October and a forum that we host in November, in lieu of what would have been our annual conference. So you can take a look at our events page to get information on that or poke me later and I'll share that with you.
So just specifically on the topic for discussion today I'm bringing forward a renewables perspective, insofar as energy storage is related to that in the complementarity of the technologies, and I really want to emphasize that throughout my comments today. So just a little bit of sort of high level overview of sort of the path of that relationship. Ultimately we know that wind and solar, the utilities scales, had rapid growth here in Canada and around the world. It continues to grow as we're integrating increased amounts of wind and solar on the grids. We're also contributing to increased variability in the electricity supply. So a broad range of approaches, ultimately, will and have emerged to manage the variability and that has enabled us to continue to steadily increase penetration levels of renewables. So things like larger balancing areas, wind and solar mix, and things like that. Energy storage being sort of that latest and greatest as the crux of contributing to more sophisticated grids. But the increasing growth of distributed energy, as well as self-supply, has, here in Canada anyway, introduced variability as well in the demand for grid produced power. So there's that balance there to be managed and understood, and in conjunction with many of the other technologies that are sort of reshaping our electricity load curve, things I'm thinking of like energy storage and peak shaving measures as well as the conservation measures and demand response, we really need to better understand the impactfulness on grids and systems and how to move forward and continue to make that progress. So increased variability is inevitably that biproduct but also creates a need for increased flexibility in flexible resources. Ultimately, though contributing to variability on the grids, wind and solar also have attributes that make them very flexible. So they can be positioned as solution providers because they're fast ramping so we've got near instant response times on wind and solar ramping down. No inertia and we've got very low marginal costs, as everybody's well aware, with the renewable resources. Modular deployment. So quite decentralized resources allows us to increase our flexibility offerings. I'm thinking of maneuvering one or two wind turbines at one site rather than sort of less flexible maneuverable things like a nuclear reactor, for example. So offering very different merits as far as flexibility is concerned. Of course wind and solar can ultimately can be deployed where the powers needed. So that decentralized aspect is beneficial in providing flexibility where the power is needed. So you can put solar right in the community that requires that power. You can connect a wind project to the distribution grid and supply that gird, ultimately locally.
Ultimately when we get down to energy storage, and talking about pairing that with renewables, we sort of blow the roof off of flexibility offerings. We talk about load shifting to meet multiple objectives at that point. Peak shaving, cost savings, grid stability is enhanced when you throw energy storage into the mix and we're able to do that now much more efficiently and effectively, which boosts the value proposition for renewables to act as solutions providers, as I alluded to earlier. So wind and solar alone, but coupled with energy storage in particular, provide a number of ancillary services. OR, operating reserve, frequency response. I think I talked a little bit about ramping, peak shifting and those ancillary services really it's not a new technological challenge that these technologies are solving. It's more about market structures and the ability to capitalize on those technological options. So we've got wind and solar operators right now. They're integrated into systems and OEMs, original equipment manufacturers that are developing new technology panels, installation and new turbines, for example, as well as existing asset owners that don't really have a lot of incentive right now to make use of those additionalities, like the ancillary services offerings because they're really not incented to do so because our grids aren't currently set up, and our markets are not currently set up, to optimize those assets in that regard and there certainly isn't a compensation measure that we can point to that incents those folks to be able to put those solutions forward. So it's not the technology it's sort of the market and regulatory framework that needs to catch up. Then accessing new revenue streams ultimately becomes the crux there for wind and solar energy producers and providers, particularly in a deregulated electricity market. As we continue to grow the levels of penetration of renewables, driving down market price of energy and then ultimately looking to enhance flexibility for grid operators by tacking on those ancillary service offerings, particularly like I said, when paired with energy storage.
That's a whole bunch of reality, I guess, insofar as where renewables sit and how energy storage can sort of continue to boost us forward and increase the value proposition for those technologies. But how do we do that? What is it going to take to continue to have momentum and see progress in the Canadian markets and beyond? In wholesale markets in particular, we need new market rules to integrate energy storage. We're scratching the surface a little bit here in Canada and in the Alberta and Ontario markets, in particular, but we really also need to see the treatment of hybrid energy storage and renewable energy projects. We also need our Crown utilities that are operating their own systems, to recognize the value and services provided by energy storage, in particular, within their electricity planning processes. So it's a big picture of our system, overview. The technology is there. It's keeping pace but we need the systems and the markets to continue to evolve and at a rate that's potentially faster than what we're currently tracking. One way to do that, I think, system operators also need increased visibility on the distributed energy side. So those resources aren't currently accessible or visible to a system operator. The data and the tools that allow sufficient management of the resources is something that we're trying to better facilitate and understand. We look to the outlooks, globally, domestically and we see folks like Bloomberg New Energy Finance, and IRENA and the IEA talking about the trajectory for investment in renewables in energy storage. I think it's Bloomberg who just came out recently projecting that 77% of all new investment in the power sector, globally between now and 2050, so in that short 30 year window, is going to be for the most part in wind, solar and storage. 77% of all new investment in wind, solar and storage. So it's going to require a lot of attention going forward to keep that momentum, and to potentially surpass those projections, as quite the disruptive resources that they've proven to be. So it's not easy. We're not going to get there overnight. This level of change and need, it's got a lot of questions. I think we're going to get to a lot of them today. We have to understand electricity system management and the processes that feed into that. System controls, the cost sharing, is obviously a major driver of how we move forward. We need to continue to learn from each other. So forums like this today for discussion, advocacy with government policy and system operators to ensure that though the grid is becoming in fact more diverse and decentralized, our technological evolution isn't going to slow down. So if we can't keep pace we certainly need to try to keep on track to move progress forward. So, again, really hopeful to scratch the surface on some of those topics more in depth today and I'll turn it over to Travis to kind of get his angle on things and see if we can marry some of our ideas in the discussion.
Travis: Great. Thanks, Brandy. Thanks, everyone, for having me. As an electricity sector nerd I always am excited at the opportunity to talk about exciting changes in the power sector. So I'll touch on a lot of similar stuff that Brandy spoke about, as a starting point, and then get into questions and discussions. But prior to that, a little bit on myself and Power Advisory. Our firm's a management consulting firm. I've been with them for almost a decade. We operate across Canada, throughout the North America offices in Boston, Calgary and Toronto. We kind of cover four general areas. We're traditional management consultant. We do asset valuation, price forecast, all with the electricity sector specialization, but we're a mixture of power system engineers and market economists. So we do a lot of more technical analysis. Whether it's needs assessment on the power system, financial modelling, perform kind of technical analysis with existing assets or development assets. The development of renewables, conventional technologies, energy storage, wires is all part of strategy in this sector and we help a lot of different clients, many of you I can see on the call today. Through that we support developers, financiers. We do technical due diligence, investment and acquisition advice and really help people understand what can become a very complex sector, which is the electricity sector. Then finally, and any who's worked in the electricity sector recognizes, it is a regulated entity even in our deregulated markets. So we have performed a lot of policy and regulatory analysis. People within our firm, myself included, have been expert witnesses or expert consultants within regulatory filings. We perform community and stakeholder engagement, provide evidence where needed, or support our clients in providing evidence, and really support through the regulatory process which is needed for such a large and complex sector. In a former life I was a power system planner at the Ontario Power Authority. I was also a distribution engineer at Hydro Ottawa. So a unique mixture of the T&D side, as transmission and distribution, is called.
I'm going to give a little bit of my view into what energy storage, I've concentrated on it for the last few years, why's it important now? What's changing and what kind of needs to be tackled? Similar to what Brandy raised. Why are electricity markets kind of turning towards storage and why is it an important component or at least a very hot topic right now? I think it's very clear that there's a growing global, regional local consensus on action on climate change but there's also economic drivers from continued cost drops from renewable resources. In most jurisdictions wind and solar generation are becoming the lowest cost supply option and they're bringing new challenges with their variable output. At the same time the demand side of the equation, which is really where all generation assets are driving for, is changing itself. Whether it's adjustment in how economies are shaped, new technologies that provide innovation and emerging capabilities for end use customers or just electrification in response to climate change. This is all raising issues in maintaining a cost effective and reliable power system that we've known for the last century. So energy storage with its vast reaction, its ability to shift low cost production to high demand periods, is really a key tool in that toolbox that system operators and grid operators have to use to tackle these changes. Energy storage has the capability to enhance reliability, but probably most importantly, increase the utilization and efficiency of existing assets, and that provides long term cost benefits for a sector that's built on long term capital spends. Many of the infrastructure that you deal with is 40 or 50 year operating or if you have, for some of our vertical utilities, large hydro assets which have practically an infinite accounting life. How do you maximize the value for the benefit of customers, both locally and across other regions? Given the potential value that storage can provide to the sector, what is the state of energy storage resources? I think it's clear, given the media attention and cost drops, that battery based energy storage is kind of the frontrunner, especially for short to medium duration, which I kind of define as 10 minutes to around 2 to 3 hours. That comes a lot with the piggybacking with other applications of battery based energy storage and it's capability to be very modular. It can be sized up on capacity or extended on the duration of hours, quite quickly, which is a real benefit on scalability and flexibility. Key components of kind of prudent power system planning. But that doesn't mean that batteries is the only thing out there and, if anything, because of batteries frontrunning on those short to medium durations, you're seeing a lot of investment and activity around that. On the ultra short duration for ancillary services there's some exciting technologies that have been around for a while, or new applications, whether it's flywheels providing regulation service in very quick increments. On the longer duration, which is kind of the next frontier for energy storage, there's a lot of activities and long duration can provide key benefits on off diesel, for remote communities, medium distribution network needs at end of lines and really changing fundamentally how you might plan and operate your system. These include advanced compressed air energy storage, potentially pump storage applications at the transmission level or new and innovative technologies, many of which are growing here in Toronto. One that comes to mind is the e-Zinc technology which has a very high scalability to long durations and looking at utility applications.
As Brandy mentioned, and I firmly believe as well, what needs to change? What are the issues we're tackling immediately to kind of unlock these benefits and values? In particular I think we start with market operators. This would be the independent electricity system operator that oversees the Ontario electricity market or the Alberta electricity system operator for the Alberta electricity market. Both are undergoing consultations and procedures to change their market designs, so that the full characteristics and attributes of energy storage can be integrated with the markets, and that they can participate on fair and equitable grounds. This very much links to where US jurisdictions are being told to go by the Federal Energy Regulatory Commission, FERC, with their Order 841, which essentially directed all markets to figure out how to integrate energy storage fairly and recognize, one, that energy storage is a unique asset. While it acts like a generator and a load, it is its own being in the electricity sector, and two, that there is benefits that customers and markets can grab from storage. So that this is something that needs to happen and should happen quickly. So both the AESO roadmap, the Alberta system operators roadmap, and the independent electricity system operator, Ontario Storage Design Project, are slowly moving towards that integration and tackling those challenges. Our analysis, in terms of the value that we've done, and we've completed this for Energy Storage Canada earlier this year, there's a potential for upwards of almost a billion dollars in savings from deploying Energy Storage Ontario over the next decade and while that may not be a huge chunk of the total spend, it is savings for customers and it's something that is a hot topic, especially in rate payer's minds that any savings is good savings and using equipment that exists today more efficiently and more effectively, is just kind of a prudent approach.
Beyond the kind of market operations, the real difficult question to tackle is treatment within regulatory space. The wires part of the business, so transmission and distribution, is a heavily regulated entity. It's a monopoly type of base system. Your local distribution company or electricity distributor, is the only one that can provide that service, they make prudent cost spending decisions on maintaining their network and determining how and where to plug in energy storage is kind of a new question. But really when you boil it down, energy storage is core value, is value stacking the ability to offer multiple services to either grid operators, that being distributors, or to the wholesale market or directly to customers. How do you do that all? Well not having conflicts or difficulties and important for the regulatory discussion, at least in my view, is who bears the risk of market revenue for an energy storage asset that has initially been deployed to meet a reliability need within the utilities distribution or transmission network? That's a question that's ongoing and really kind of raises core questions on principles of application of rate design in going forward. There also is a key conundrum brought on not just by variable renewable energy resources and energy storage, but also the change in flexible demand, and how do you plan the power system going forward with all these new tools? There's a more deterministic, we have a peak demand, we need to serve it, still the best approach or do we need to move to a more probabilistic? In other words, accepting the errors in our forecast and potentially spending a little bit more in the near term to provide long term optionality and the benefits that flow out from that and that's something that you're starting to see. Probably a great example of that right now is Nova Scotia's integrated resource plan which is considering 13 different scenarios on how they're going to manage the future, all with different sensitivities and recognizing there's a lot more uncertainty as we move forward, both from climate change impacts but also climate change policies, economics on our inputs and the like. So a very interesting time but difficult from a kind of planner's hat point of view.
Then finally, and agreeing again with what Brandy had said, there likely is going to need to be a lot of investments to help unlock these benefits and so there's a cost prudency. Whether it's investing to have more visibility into distribution and transmission networks to understand how load patterns are changing, or changes in how those distributors control and operate their system, where historically they've been a delivery entity. Having to actually tackle the potential to be a dispatching entity, and working with energy storage to make sure it meets reliability needs within the distribution system, while potentially meeting services upstream to wholesale markets.
The last one, in terms of changes, is somewhat related to government policy. One of the core things for energy storage that's located at a customer's site is it gives customers kind of a mutually exclusive option to determine how much electricity they consume from the grid while not changing their consumption pattern. The storage can cycle and change what you consume versus how the grid operator sees it. That's a big change where before if you wanted to react you actually had to change, as a customer, how you are consuming. Whether it's shutting down factories lines, or adjusting your business practices, or making investments, storage can kind of do all that on the side without making you change how you operate your business. That's an important impact on how we're going to perform cost recovery for large fixed costs in the system, how we're going to adjust rate design and, ultimately, how we are going to reflect the value of staying connected to electricity networks that, again, have been built for over a century.
So I'll kind of part with where are the best opportunities for storage, at least in our view. I think when you start here, in Ontario where I'm based, the avoidance of global adjustments still is a frontrunner despite uncertainty in that potential value from government policy changes. As mentioned there's a lot of long term funding committed. That funding is going to have to end up on customer bills, and the ability to adjust your consumption to either minimize the bill or avoid future spending is a real key question, and a value that can be delivered to customers. When you look across other jurisdictions, the kind of second opportunity which exists in all jurisdictions in Canada, is providing ancillary services. So this might be frequency response or operating reserve. Experiences across the globe have kind of shown that's low hanging fruit for energy storage, especially with its vast response time and the ability to kind of provide multiple services from one spot. Then finally, and probably the toughest nut to crack is, how do you provide reliability services to utilities such as distributors or transmitters, in a way that doesn't put undue risk on rate payers but maximizes that value from a modular resource that can be placed and increase that utilization and efficiency of those networks. That is going to provide long term benefits to customers that have typically been left with build out the system more is the only way to kind of manage growing load. You have a potential to kind of increase the utilization and fill the pipe more often throughout the year versus just during peak summer periods. So I'm excited to kind of start tackling and answering questions and, again, thank you for having me here.
Tom: Thanks, Travis. Great points. A lot in there, both of you, a lot to unpack. We're getting questions already so I'm absolutely delighted. Brandy, I'd like to go back to something that you said, for a moment. It's not the technology, it's the regulatory environment that needs to catch up. That's something that I've thought about and, of course as lawyers, we see a lot of different industries and the regulatory environment surrounding the energy system, in particular the electricity system, is of course quite complicated and there are very few people, I'd be surprised if there's anyone alive who really fully understands Ontario's energy regulatory environment, end to end. But it's a lot of complexity. It's a critically important industry, obviously, so we do need to be careful about change but one of the things that worries me is that if our regulatory systems don't adapt we, in Canada, whether it's Ontario or Quebec or wherever, we could be left behind because there's a lot of innovation occurring. We are competing every day with people in California, with people in Germany, with people in Shenzhen, so do you see that as a possibility or something that we should be worried about, our government policy makers should be worried about at all?
Brandy: Absolutely we should. I think there's no doubt that the speed of technological change is a tremendous challenge, generally, and then for market and regulatory design and grid operations overlaying on that, it creates the risk to stagnate investment. One way to look at it is we've got power grid planning cycles that are on the order of decades, and they're quite conservative in their approach which is appropriate, but the technological cycle, however, is in the order of just a couple of years at times and we're seeing that now where technology goes through multiple iterations and capabilities are realized within the scope of what would normally be one integrated resource planning cycle or one transmission planning process. So just inherently those two processes don't align. So I talked a little bit earlier about how we've already made good progress at integrating renewables into the grid. We know what challenges that presents. We also have put our thumb on the pulse of what opportunities are there but innovation and investment signals can't be motivated or driven just by the fact that we know it can happen. The processes have to be enabled. So I think one of our challenges, recognizing the technologies are there, we have things that can provide energy right now but they're also capable of providing ancillary services, like Travis was alluding to, and all the other really great things they can do. How do we get there and how do we compensate? So what's the line of vision? What's the investment signal and how do we stimulate those things? When we look at integration of energy storage, and we look at just the Ontario and Alberta electricity markets, we see variance in the ability to catch up and keep pace. Alberta, for example, has mapped out what has been a pretty practical approach in a short period of time whereas Ontario's taking a bit of a longer view and potentially, I would argue, hasn't made as much progress in that period of time. So it's really important, and I think I'm kind of like going all over the place here, but ultimately, back to the thesis of the question is, how do we not fall behind? It's almost hard to say when we can't even put our thumb on how we keep up. I think ensuring stable policy environments, ensuring that system operators, grid operators have the tools and processes available to them to continue to explore and enable these resources is important. But progress has no patience so we often tend to have our concerns highlighted in these forms where we can't really put our thumb on the end goal. We know the end goal but we don't know how to quickly get there. The short answer, yes, is the short answer to your question. Absolutely I think there's a risk that we'll fall behind and we will potentially lose out where other jurisdictions are making gains, for example.
Tom: Travis, maybe I'll put the same question to you but I'm going to change it slightly. Is there a possibility here, and I do see this in other industries, you see this in the nuclear industry where there's actually the hope that our preferable regulatory environment might actually drive innovation and drive investment, make us a good place to invest. Do you think that's a possibility in Canada?
Travis: I think when you look at Canada it's a difficult place to kind of give a sweeping brush because we have such different regulatory regimes. We have certain Provinces that have made long term commitments to large hydro and have had that be a great play, in terms of not just meeting their own local needs in a climate change matching way, but also being able to export to neighbouring jurisdictions where you have open markets in others. But I do think we have a fairly robust regulatory system that can support this. It just requires accepting the changes you're going to have to make with your core assumption and foundations and I think Brandy already touched on it. We have planning cycles, from a central planning point of view, which have not adjusted that much and with all these changes that are coming in you're really being pushed to revisit certain assumptions, and you're seeing that play out not just in Canada in terms of the commentary going back, but very much in the US on State policy rights and customer needs. Without that kind of consumer choice coming through, within a central planning system, you stifle innovation and you're not letting customers make their own choice. I think that when you look back on IRPs and integrated resource plans, or other kind of choices, it's a forecast for the future and there's a certain amount of uncertainty and error that's going to occur. If you centralized all that error on a single body and have to kind of push that down onto rate payers you're going to have them squirm away and look for options to reduce their costs, and it's a very difficult kind of ability to do that, and our regulatory structure doesn't really help breathe that innovation. I think that's one of the things that has to change is you need to look and say, what do customers want and how do we support them making that choice, but at the same time be very clear that there's a risk that they must carry with that and what's a prudent balance between that. That kind of ties into Brandy's other point on the movements in Alberta and Ontario. From the market operation it will be a little different. Alberta's market design is quite simple and straightforward. It's very much package as much stuff into the price, push risk onto producers and it's energy only encourages bi-side activity. In other words, customer's making the choices they want, whether it's green energy, low cost energy, consistent firm energy. Where under Ontario's regulatory system it's very much a command and control. There's commitments whether it's IESO contracts or rate regulate which can provide long term benefits. You can invest in nuclear power, for example, that provides long term consistent baseload power but it also means you're hitched to that ride, whether it goes well or wrong. Customers, again, kind of push back and there's price action. I agree with Brandy. I think there is a risk. I think all the activities, and stakeholder fatigue, is an example of the fact that the sector recognizes change needs to come and the difficulty is where do we start and how do we make sure we don't either fall behind, or get sideswiped later, by innovations that come forward directly for customers.
Brandy: Exactly. I just want to pick up on the planning aspect and the notation that we're still all at the table as stakeholders, as investors. We think we've got some great solutions. We're looking for structures and forums to insert those and markets ultimately. I think the planners need to start thinking about things differently. We've got a lot of really traditional reliability metrics that we rely on and that's how we put forward these conservative forecasts and outlooks. But I can point to one example, in particular, around value is not currently, at least not sufficiently I would argue, is not being placed on reliability services proper needed as we continue to see these peak year demands, our load curve is shifting. Building that into the planning process more succinctly is something that we can do because I don't think that there's any black and white template, or single option, for how to do this because every control area is different, every system undertakes its own planning in different ways, but as a general principle it's important to start with that definition and more placing value on the flexibility and reliability services that are now required across the system, as a whole, and then we can hammer down into the more specific pockets of the system to establish frameworks. That will allow those services and products to be acquired from a broader potential range of resources like energy storage and hybrid projects. So transparent, clear definition of all of those services is a great starting point. Something in the planning world that is, I think, a principle but applied differently. So requiring that transparency and definitions to allow service providers, like energy storage and other products, to step up and understand what the needs are and how best to meet them and working against multiple objectives at the same time. I could probably write a thesis on this, and hire a good consultant to help me with it, but it's an ongoing process is the point. It's iterative but we have to keep pace. We have to be able to provide those positive investment signals and make sure that these opportunities for competitive procurements are enabled. We can talk about flexibility metrics, which actually aren't a real thing, but I'd love to see them evolve and maybe we'll get there eventually in the conversation.
Travis: I think the easiest kind of starting point, I mean planners want to plan. They want to get to the solutions. They want to get to what's going to get built but when you're looking at trying to encourage, not just innovation but ensure you're capturing the best solution for an uncertain future, you have to have the planning process start, very clearly, at defining the problem and then going out to market in one way or another, and this doesn't necessarily have to be a free for all. It can be much clearer defined or it can be an open procurement to say, we have a problem. What are the solutions out there to solve it? Then look at those solutions kind of from is it viable? In solving the problem I've identified is it the most cost effective? And then the hardest one is, is it scaleable and flexible? I have a certain view of the future that's my base case but what are the sensitivities around it? Is there a chance my best solution for the base case could be my worst solution under a certain sensitivity? If you've kind of looked at any kind of planning documents, the core view is can I kick the can down the road a little bit more, so I can get more uncertainty? Can I make the right decisions until my long term decisions are fairly locked in? But under my uncertainties this is the right thing to do and I'm going to go forward. I think that, almost you'd call it cultural change, it's really difficult because it needs all stakeholders to come forward. It needs the planners to stop and have a robust process to encourage solutions but it also needs stakeholders and developers to come forward with viable cost effective solutions that can demonstrate that scalability. I think as we're heading towards that path we're going to start to see a lot of that innovation unlocked. Whether it's in partnerships with distributors and new technologies, customers bringing forward their own solution, whether it's demand response or distributed energy resources at their sites, or just something out of the blue in terms of new technologies and providing it. It starts with planning because planners, while they might want to plan, at the end of the day they're really analysts to the system. They know it the best and they're trying to communicate to all stakeholders, this is what I need in the near term and in the long term, who can help me and what's the best path forward?
Tom: Fascinating. Lots to unpack there. Planners definitely do want to plan and that's what they do well. In the meantime, the private sector is driving forward and I've been amazed by this sector in the last 5 or 6 years, how much is happening and how much I wouldn't have predicted. I've been involved with CanWEA for at least 15 years, maybe closer to 20 years, and if you'd asked me in 2005 or 2006 how energy storage would roll out in Ontario and whether it would be GA, I wouldn't even have thought that. It wouldn't even have occurred to me. So things are happening. Things are also happening at the microscale and residential. Residential customers are taking this up. So if you go to the Cottage Life Show, we used to have a Cottage Life Show before COVID, but it used to be you'd go to the Cottage Life Show and you'd see 5 or 6 vendors selling batteries and DC current products that you could put in your cottage, so direct current products like refrigerators and stoves and things like that. That I found amazing. Any thoughts in terms of what the exciting technologies are? We had a question to this effect, coming down in the pike in the energy storage space, is there anything that amazes or you think might be overlooked?
Travis: I think I'd start with, and I mentioned a little bit off the top, that some of the kind of innovations happening on long duration storage, especially something that's modular and scaleable and being able to cite, is really interesting. You mentioned cottages, but rural and remote locations are very difficult to serve for kind of a wires solution, and you're seeing a lot more discussion on microgrids that connect stuff that is, I'll call it cost effectively and reasonable interconnected communities, that may not stay connected to the larger grid. Or may not have great reliability as it stays connected to the larger grid. So when you see long duration storage technologies that can provide 8 or 12 hours of storage that means that you can start really chasing some of the renewable generation, to provide your generation supply locally, but be able to maintain what is kind of a common reliability set. The one day in 10 years outage target that most central planners do without using traditional kind of solutions. I think that change, along with control software, is probably the other big component. You hear a lot about artificial intelligence but I think really it comes down to do you have the visibility of the system? Can you manage changes that go forward? Can you understand how demand might change? If you can marry that altogether you don't necessarily need that billion transmission line. You could reinforce it by making investments directly in the communities that are being served, in a more cost effective manner that utilizes and under certain conditions can actually start exporting to other neighbouring communities, under certain circumstances.
Brandy: I would say, just on the flip side of that, the utility scale. The hybrid hopes. This is where we all like to focus as the angle, is having these true, what we call true hybrids, on the grid providing those solutions at a utility scale. I think we, as a concept, accept that pairing energy storage with renewables is a great idea. You've got the non-emitting generation as your marginal costs, and fuel, and you've got firm power. But we're not there yet. We appreciate the reality of what that can be but highlighting systems for variable renewable energy has provided grid friendly support in more than just energy only applications. We're getting the research now, and I think I dropped all of the institutional research names at the front end: the International Energy Agency, the National Renewable Energy Laboratory of the US, IRENA even is opining on it, Global Wind Energy Institutions, they're all taking a look at this and the research is showing, increasingly, that variable power isn't necessarily leading to unstable power systems because we can put these projects on the grid to create the right mix of renewables and controls within the system, to have the unique sort of capability. So a new type of power plant. So it's just, again, blowing that back out to the large utility scale for potential, for energy storage. We're proving it. We're realizing it through research, through actual demonstration projects at utility scale as well as smaller demonstrations. This scale is across the board. So it's exciting. You can probably have a whole hour and a half webinar just about small scale applications for cottagers or grid level. Running your cottage with hybrids. It's very exciting and what's exciting about is that it's not just a notion or concept anymore. It's proven. The economics are there. The technology is there. The systems and controls are coming together. Very optimistic in that regard.
Travis: It's interesting because we've talked a lot about kind of, I'll call it technology solutions, and what's innovative. One that's starting to kind of be at the frontline, and where I see storage is long term view, is more on the financial markets and storage being probably being one of the first somewhat true physical hedges that you can operate within electricity markets. The ability to go and dump your excess energy into a device and use it later, whether it's for your own reliability or for active retail markets like you see in Alberta or in the Texas ERCOT market, the ability to then produce standard retail blocks and sell that into forward markets, and allowing customers a lot more flexibility to manage their electricity needs, and not have to be left to kind of spot market or real time prices. That they can actually look forward and say, energy storage is going to give me high confidence that if I buy 100 megawatt hours it's going to be there when I need it and at a price that I've agreed to through a long term contract, whether it's with renewables or some other technology. That's really interesting in terms of how that might actually realize the original benefits of deregulation. Of giving consumers choice. Having hedges going through the market and having kind of a wholesale participation and a retail participation married together to ultimately meet and use customer's electricity services needs.
Tom: That's a really great way of looking at it, Travis, and I want to come back to the topic of GA and the postponement of the GA ICI program. But before I do we had a really interesting question from a gentleman, I'll just call him Ian, regarding the GA and the question was, are there any other markets where we have a global adjustment, I'm using jargon here, global adjustment, which is still jargon, but Ontario's global adjustment, are there any other markets or policy environments around the world where they have something similar? It's a good question.
Travis: It's a very good question. Through my almost decade of consulting I've always said, if you can understand the Ontario electricity market, all the other markets look quite easy to understand. Part of it is because we have this hybrid market design where we have a wholesale market that handles the scheduling and dispatch in real time of our supply resources. But that our investments are driven either by rate regulation or long term contracts and that kind of hybrid mixture is what creates global adjustment, which is the top up payments for our regulated and contracted assets. There's not a lot of other jurisdictions that have it. Some of the jurisdictions that have vertical utilities but have a more open retail set up may have it but Ontario is very unique. When I mention global adjustment creates value for storage, the main aspect is whatever rate design you determine to recoup costs for those funding commitments you've made, whether it's for, again, a rate regulated or a contract and supply, customers are going to look for ways of reducing the costs that are applied on them. So if you are putting them in as a peak demand or non-peak, you're going to use storage to try and shift your consumption away from those time periods. If you're going to be charging on a per megawatt basis for your ancillary services, customers are going to look how do I reduce my megawatt calculation out of there? So when you look at Alberta, their 12 CP example kind of helps level it off, but in Ontario our global adjustment for large customers who have been 5 coincidental peaks. How much you consume the during the 5 peak hours. But because you have so much locked in cost, that's where the value of avoidance really sits, and it is going to be there for at least the next decade given how long the contracts are and our commitment to our rate regulated assets, and that's just going to drive, again, consumers who are going to look for ways to save money. I think more importantly what you're seeing is proponents and technology providers are going to seek out markets. When you have a market that you don't have to worry about the avoided costs, you only have to worry about the policy, that's one less risk and that's going to be attractive compared to other markets that very quickly can go from being over supplied to under supplied and vice versa. You have to kind of manage that market risk which, at least given the current contract today, doesn't exist and even the ISOs, in the Ontario system operators report to the government says we don't have a lot of optionality to manage the contract costs we have. So we kind of have to live with it and because of that you have a lot options. Energy storage being one of them but other resources are also available to provide that.
Tom: Thank you, Travis. Any other thoughts on that from your side, Brandy? There's another question but go ahead.
Brandy: I think, just anecdotally, I was chatting with Nova Scotia Power a couple of weeks ago about something different. It was behind the meter talk and net metering things like that and the global adjustment in Ontario came up, which really surprised me. But to the tune of, so what's this global adjustment all about? What is that? Off guard it's really hard to just break down the global adjustment into a simplified definition or explanation so thanks, Travis, for that actually. That was a great overview. I go back to understanding the metrics that we're grappling with, or at least trying to optimize here in Ontario, from a market perspective. Businesses, whether your DR or energy storage provider, are looking and the metrics associated with solving the challenges for large loads are something like, I can't remember and I'm sure someone on the line will correct me, but there was like if you reduce your peak demand by a megawatt, it's like a half a million in savings the following year. That metric always stood out to me and certainly some of the members that we represent are looking to continue to provide those solutions to large loads, but are navigating this really complex system of rules and regs, and incentive programs, and non-incentive programs and things like this. If anything, I just want to hone in on the complexity of the GA, it's not just a cost. It's a market, I don't know if you want to call it opportunity or hindrance, it's a reality that is unique to Ontario like no other jurisdiction.
Travis: I almost find it funny is Ontario's kind of fallen backwards into where most other jurisdictions are somewhat heading. In that if you want the lowest cost supply resources you need to make long term funding commitments. Whether it's through rate regulation or long term contracts. Now Ontario, I think it's safe to say, got ahead of itself both in how they constructed those contracts and in the diversity of term, or the lack of diversity in term. But that's not to say contracts and rate regulation is bad. It's to recognize there are risks in how you go about doing that and you need to manage those risks. When you look at other jurisdictions, they try and push a lot of this into short term, they really struggle to kind of capture some of that value, and they're starting to shift towards longer term contracts or forward markets that can capture the long term value of a wind or solar or potentially a nuclear large hydro, for example New England's 83D procurement of renewable resources, which was primarily a hydro Quebec export success. How do you marry those? I think the situation in Ontario is a good example of some of the risks and hopefully Ontario, as they manage through this global adjustment, can kind of figure out how do you maximize the benefits of those long term funding commitments but minimize the risk of fleeing load, but still provide incentives for customers to kind of manage it. To go on a little bit of a sidetrack but that's part of the issue is your policy changes are going to change your load. Ontario's freezing of the industrial conservation issue, which is essentially that large customer's global adjustment application, saw a jump in demand of 1,500 megawatts during the peak demand date. That's a massive jump for a system that peaks at 20,000. So you start to see the conundrum planners are faced with, not just on how they contract a rate recovery, but when policy changes to react to things outside their control, such as a global pandemic, how do you ensure you have the right resources available and more tools in the toolkit is going to help you, storage being one of them, in my mind.
Tom: Just before we leave the topic of GA, the kind of the postponement of GA which you just alluded to, Travis, how do you think that was received by the market and any thought, maybe Brandy, you might have some thoughts on this as well. How was that received by the market? How are people feeling about these GA busting projects that people have been working on? A lot of them are literally under construction. How do you think that's resonated? Then, Brandy, maybe for you and this is the back part of this question, which I think is an excellent question, what, if anything, is CanREA saying about this to the government agencies of the Province of Ontario? Maybe I'll start with you, Travis, and then, Brandy, you can answer.
Travis: So our firm, and myself in particular, have done a lot of due diligence on these projects and it's really boiled down to government policy risk. As I said, the cost to avoid is there. The framework, as it exists, really amplified the benefits the storage could provide these large customers but the government did have the capability to change, quite quickly, and so projects that moved forward it was kind of an accurate risk and reward. If you look at some of the estimates, for example Lazard which is an investment bank and does an energy storage annual outlook, it identified Ontario as one of the better places to invest for global adjustment avoidance with an IRR, plus 20%. But that plus 20% came with the risk that we're seeing play out. So while you likely have seen a freezing, and a lot of investments that were being considered taken off the table now, I think it was a recognized risk and now it's going forward, how do I maximize either assets I've already put into the ground, or I'm building, for those customers? There are services beyond GA that can provide value. Where can I find different customers to sell? So, in particular, if you have a storage facility behind the meter at a customer can you start approaching the local distribution company and say, can I help you meet your reliability needs and operate this battery, as a way of reducing demand on a feeder or a substation, or provide power quality improvements or enhancements that is more cost effective than other ways? That's always been the long term play for a lot of the storage developers that we've dealt with. Is that at the end of the day you're trying to value stack and provide services and diversify your customer base.
Brandy: Yeah and maybe I should have started first because I have more of a practical reality that I have to state, particularly in response to the question of what CanREA is saying about it. The impact it's had on our members, and to be clear we're really talking about the government pulling out of the Industrial Conservation Initiative Incentive Program as opposed to postponing GA, proper, it's still going to be there. So Travis definitely, I think, is on point with the path forward. So as an association that's where we want to bring our members as well is to start to explore the path forward. Post-ICI, or in lieu of ICI, but to answer the question, pointedly because maybe it's a CanREA member who hasn't engaged with us, we were quite vocal on that as CanSIA, ultimately because this all came down just before our merger on July 1. So the Canadian Solar Industry Association was on the record with the government really trying to encourage them to take a measured approach to the ICI. Where Travis started his remarks, identifying this as a government policy decision/therein lies the government policy risk, I would have coined it more as a political risk because there is no policy attached to that decision, ultimately. They don't have a path forward or have they not yet put one forward. The government has thrown the ball over into the court of the IESO to survey DR participants to see what they've got going on. I don't know to what end, and so if I do sound a little pessimistic about it it's because I don't have confidence that that process is going to lead to the path forward that Travis much more practically, I think, spells out. So we're concerned about the decision. We don't have a position specifically on whether or not the government should re-enact it in it's right. It was a draw on the tax base and so if there is a better policy, or a better way to go ahead and continue to incent investment and protect investments already made, we'd like to be at the table to help inform that. But I think it's really about moving forward, looking to what those market signals are and how we optimize these opportunities for large loads and other customer classes. The CNI market really needs a boost here in Ontario and the solutions are here. We need the frameworks to be able to build them. I really think Travis should have gone second, so he could've got my little pessimistic rant out of the way, and then sort of target it with that path forward.
Travis: When you look at, and Brandy I agree with everything you said, from a more fundamentals point of view and you look at where this Province is going, we're long on energy for the foreseeable future, but we're short on capacity to meet peak demand. That naturally kind of suggests to you if I have some way of shifting that peak demand into other hours, away from our peak demand and use up that excess energy that I kind of have, that makes sense. If you can encourage doing that through some risk taking by your CNI customers, with benefits, that's a path forward. Our value assessment on Ontario, a large portion of it was you do have a lot of curtailed energy in this Province, and it's referred to as surplus base load generation. Which means we have too much and we're exporting. There's at times where we can't even export enough, and we have to start turning off resources that we're paying to turn off, and turn someone else on.
Tom: Sorry, you also have a wonderful domestic industry that's kind of blossomed. Not just pure storage products but all of the ancillary products including the algorithms, peak prediction algorithms, and the battery system operating software. There's a lot of pieces to this puzzle including even the financial solutions. This industry has kind of blossomed despite really nobody paying attention to it.
Travis: Yeah. To use the phrase, try not to throw the baby out with the bathwater. You've got a lot companies that provide solutions. How do you take that long on energy, short on capacity and shift around? It's clear with the ICI you've exaggerated your problem. You've added an extra 1,500 megawatts of shortfall, the 2 to 3,000 that you're predicting right now from the ISOs view. So that sort of government policy/market policy, whatever you want to call it, that's where you kind of need to focus in on and not just try and deal with the problem as it exists right now and start to look at how do I deal with other problems coming down the pipe?
Tom: Brandy, how do we use storage to enhance reliability? How do we use storage and, Travis, you'd made reference to the billion dollar savings. I know that there are a number of policy makers on this call today listening. Where's the billion dollars? Where do we find these savings? How does energy storage fit into that?
Travis: Maybe I'll jump in. So our study kind of looked at a few different areas. I'll bucket them into two groups. One is on the wholesale market side. So these are services provided to the transmission grid or to the ISOs market. The second is on electricity infrastructure. So this is primarily transmission and distribution. I've already mentioned one of the core groups which is avoiding curtailing cheap energy and storing it and shifting it into more high demand periods. There is a significant amount that happens. The ISOs latest projections look at potentially 15 to 18% of wind in the previous year was curtailed. That's a lot that had to be dumped because we didn't have enough demand. Storage can ensure that the demand's there in those off-peak times and it's shifted to more valuable. But there's also other values in the wholesale market that aren't direct payments. Where storage likely would need some sort of external payment structure or change to market design. A good example, and what we looked at was, the Generation Cost Guarantee Program. Which essentially said, can we make sure that we have enough generation online to meet our demand for the day, while prepaying for that when it's not needed once the real time day plays out, is potentially wasteful money. If storage can reduce the need for that it provides value, in the long run, because you have storage sitting around. On the deferred transmission and distribution investments, a lot of that requires changes to regulatory. How can utilities, such as distributors or transmitters, get this into their rate base or into their rates in a cost effective manner that doesn't expose rate payers to unforeseen, or unneeded, risks but avoid large investments? Whether it's kicking it down the road for a few years or, potentially, if demand changes deferring it even longer. That scalability and flexibility was another kind of core component of that billion dollars over the next 10 years of savings. It really is operating the system differently but also funding and providing cost recovery in alternative ways.
Tom: Okay. That's great. In terms of the kind of deferred transmission and distribution costs, are we anywhere close to having our regulatory regime set up? I know there's been a lot of discussion in California about that. Where are we in Canada, Ontario, Alberta?
Travis: I think what's missing a little bit is a price discovery event. We really don't know what the costs would be for storage to provide those services. We've had some kind of pilot projects look at it but nothing on large scale. In my view what it comes down to, and New York has tried to tackle this is, there's a reasonable disincentive for distribution companies to not pursue non-wires alternatives. The main thing is it's not clear how they make the same amount of revenue for their shareholders. They don't grow their asset base or they're not able to put it into rates. So it's difficult for a distributor, while they are doing public good in their planning they are also beholden to their shareholder, and in many cases municipalities that depend on the dividend. So we need to kind of change our regulatory structure so that when you pursue a non-wires alternative that's cheaper, you're providing a very similar returns to that utility, of following a wire solution. This can either be using a regulated backstop solution as determining how you're going to do it. In other words, you would have built the wire solution and it would have made you X dollars, we'll still pay you X dollars if you choose the cheaper option. These sorts of things take a while to kind of sort their way out and then it adds onto the second question which is, you know storage is the right approach but you can't treat storage by itself. You need to factor in all those additional revenues. How do you ensure those revenues, from the markets, aren't putting undue risk on rate payers? So is that a fixed rate payment to storage, through a third party contract of which the utility can wipe their hand of the risk ,and know they're getting the reliability through contract provisions? Or do you need to kind of have some rate payer exposure once it reaches a certain threshold? That there's enough of a reliability benefit, the sprinkles on top of the cake are worthwhile, to get the project across the finish line. These are very complex questions and Ontario has, for the last little while, had a change in regulatory regime with the new OEB mandate, Ontario Energy Board mandate. But it's going down there. In Alberta, the Alberta Utilities Commission, has completed its distribution system inquiry. They've tackled this and are starting to look at it and the AESO is looking at storage as a transmission asset. So there's concentration there but it's very complex and deals with a lot of kind of principle questions on what should be regulated activities and what should be unregulated activities.
Brandy: Right and how to do it. I know that in Alberta, you just mentioned that, Travis. I thought you might get into a little more. Transmission cost deferrals aren't really an option there. So you are probably going to see a transmission review, this fall in Alberta, based on the need to move forward with their energy storage planning. It's an interesting dynamic there and it's not simple, as much as I like to have the ideology conversations around wouldn't it be so great if we just had hybrid resources and we could do it all? Getting there is a challenge. The transmission cost deferral doesn't fly in Alberta, for example. So it is complex. We see these complexities as opportunities to provide solutions and move the needle but it's a real big challenge, for sure. When you've got both the AUC and the AESO tackling similar challenges to solve one challenge, which is how do we get energy storage functioning in our markets economically and effectively? So yeah, it's interesting. I'll just sort of touch on, again at a high level, Saskatchewan. Not a hotbed of a market, generally, but they're really keen at Sask Power to understand what does energy storage look like for us and how do we do it? Sask Power ran an RFI back earlier this spring to understand what's the investment like? Can we buy a battery? Simple concepts in putting into a sophisticated system. The consensus, I believe from the input garnered from that RFI, was strong enough to enable a market to go ahead and Sask Power will likely put forward a procurement and run an RFP, or something similar, for a battery energy storage. That's a great start for a system like Sask Power on the utilities. So these are the optimistic highlights that I like to bring forward to the practical realities behind the scenes, of implementing them and integrating them, are a little bit more technical and complex but there is potential. Despite the complexities so we like to focus in on those solutions.
Travis: I think you bring up a good point. Every power system has different where they stand today and different constraints they're trying to deal with, and where you might talk in Ontario about avoiding new supply build or deferring new wires in growing urban areas, you're correct. In Alberta it's not so much about avoiding new transmission but it is very much focused on, we built a lot of transmission, how do we increase the utilization of it? How do we get more resources on without having to build new transmission wires and still meet our zero congestion? In Sask Power, being the engineer's vertical utility, they have a unique problem in being very spread out and having to deal lean their neighbouring jurisdictions during certain operating hours. You don't want to do it. It's costly to lean on your neighbours too often.
Brandy: It's a little risky too. Yeah, the visibility from Manitoba, the interconnects, is causing challenges and they're small in scale. We're talking 20 megawatt system but they're really looking to have a made in Saskatchewan solution to those challenges, for sure.
Travis: For those that do kind of trading in electricity markets a lot, the view of storage is kind of seen as you can import and export over interties with neighbouring jurisdictions or you can put storage wherever you want in the system. You kind of a black hole import/export point right there where you can push it out of the system then pull it back in when you need it. That's a huge tool to kind of help power system planners kind of manage real time problems in their power system.
Brandy: Yeah, at their own scale. For sure.
Tom: We're coming down to just a few minutes left. We've had some great questions. Brandy, in terms of Canada's kind of climate commitments, where do you think storage fits in there? Is this an essential piece of the puzzle?
Brandy: Absolutely. I really wanted to have a chance to talk a lot more about the non-emitting factor and climate change. We talk about ourselves as solution providers because we're talking about grid level issues and integration of renewables and storage, but climate change continues to be the number one challenge that we're facing as a society, and the solutions that we put forward, at a global scale and right down to the local level with renewable energy and energy storage, are a bit part of that. With the Federal Government right now, that's tasked with understanding how to restimulate our economy post-COVID, and we have a large movement to bring something back better. Bring back better. Build back better. I was thinking when I said it out loud it didn't sound right. Maybe it's been entrenched in me for so long. Build back better. What that means is do it in a way that also stimulates a clean economy. We have the research and we have the cleantech here in Canada and we are one jurisdiction, globally, that can genuinely set targets like having an emissions free electricity sector by 2050. By whenever you want it to be. Those are real goals that we can accomplish in Canada built on the back of our already highly non-emitting electricity system. We're already over 80% non-emitting in Canada, as an electricity sector, and we really need to leverage that capability and deep electrification is a part of that. But overarching Federal, I'll call them incentives, but policy is going to be a big part of that. We need to continue to push that forward and now is the right time. So our climate policies have been strong already, Federally in Canada. We have diversity in the Provinces. insofar as how those policies are viewed and ultimately implemented, and we're not talking just about the simple conservative narrative around carbon tax. It's a bigger picture. We can really continue to build off clean electricity sector to encourage investment, that doesn't increase emissions, and something that we can do across all sectors. So we all get into the weeds, as I think Travis introduced himself as an electricity sector nerd, but we're there. We're here. We have to continue to make sure that we are integrating more renewables and energy storage, and that we're leveraging our massive hydro resources across Canada, so that we can contribute to those broader economic policies and goals that will ultimately create a clean economy and lots of economic stimulus that is non-emitting.
Travis: An interesting thing to add to that is, Nova Scotia's integrated resource plan is kind of simple conclusion to policy makers is electrification, while it is a cost to do so, can end up actually lowering rates for all rate payers. The more people consume the lower the unit costs can be and from Nova Scotia Power's kind of view, that's an interesting conclusion as you try and clean up your electricity sector and support other government policy goals, whether it's Provincial or Federal. That sort of analysis and application is going to be really interesting and that's where storage can be a big help in capturing low costs resources that not just support the electricity sector but potentially support other economic sectors in meeting their climate change requirements.
Tom: We haven't even gotten on to the topic of EVs. We've had a couple of questions about EV, electric vehicles, but unfortunately we probably don't have time here today. I'd like to finish just thanking both of you. I think you both qualify as electricity system nerds, or as Roman Mars puts it, beautiful nerds. Thank you both for participating. Excellent insights. Thank you everyone for the questions today. It's been an absolute pleasure. Please join us again for Roundtable #2. That's coming up on October 15 when my partner, Laura Van Soelen, is going to lead the group, taking us through with what's going on with SMRs, small modular reactors, in Canada. Then our third Roundtable, topic yet to be determined, on November 19, Thursday, November 19. Same time, same station. Thank you again, everyone, and Brandy, Travis, really great comments and really much appreciated. Enjoy the rest of your days. Take care everyone. Cheers.
Brandy: Thanks very much.
Travis: Thanks everyone.
Tom: Bye now.