On July 9, 2012, record high temperatures led Alberta’s demand for electricity to reach an all-time summer high of 9,885 megawatts at 2 p.m. During this time, three coal-fired units and one gas unit experienced unplanned outages. This was combined with another coal unit already down for scheduled maintenance, representing a total loss of over 2000 megawatts of power. Due to lack of wind, only about 5 megawatts of 970 megawatts of installed wind generating capacity was available. As a result, load (electricity demand) exceeded available generation (electricity supply). The Alberta Electric System Operator (AESO), the independent agency that manages Alberta’s electricity grid, requested transmission facility operators and distribution companies to curtail power so the system didn’t fail.
EPCOR and ENMAX employed rotating outages throughout Edmonton and Calgary to reduce demand as the AESO continuously monitored the grid, sending out notifications to transmission and distribution owners as soon as sufficient power became available.
Alberta law requires that generators offer all their available power to the electric grid unless there is an acceptable operating reason, such as a safety issue, that prevents the owners from doing so.
The Alberta Electric System Operator and the Market Surveillance Administrator have access to this information and are reviewing events of the day accordingly.
When the temperature increases dramatically, demand for electricity for cooling systems like fans and air conditioning units also increase. Traditionally, December and January see the highest demand, and summer the second highest demand. So far in 2012, winter peak demand on January 16 was 10,609 megawatts.
Alberta’s electricity system is very reliable. Private investors have built over 6,800 megawatts of new generation valued at over $12 billion – keeping up with the fastest growing economy in North America. The circumstances on July 9, 2012 were very unusual as there were many generators unexpectedly off line at the same time. In case of such unlikely circumstances, the Alberta Electric System Operator (AESO), the independent agency that manages Alberta’s grid, has a well-established plan to ensure the overall system stays operating by reducing supply to some areas. This practice is used in many other jurisdictions in North America.
Unfortunately, such outages affect some customers. However, by reducing power to some areas, the electricity system as a whole remains operational. In this situation, by shedding two per cent of the load, the remaining 98 per cent remained operational.
These are relatively infrequent circumstance and the last time a similar event occurred was six years ago in July 2006.
The AESO has a tiered alert system when there is an electricity shortage. On July 9 the alert level went to the highest emergency level in just minutes, so utilities didn’t get the lead time they normally would to alert consumers.
In accordance with AESO procedures, when the electricity demand exceeds generation supply, the system operator directs transmission facility owners and distribution system owners to reduce what’s called load – in short – to reduce demand. In turn, utilities follow established protocols to ensure that electricity service was reduced in areas deemed non-emergency – and for only brief periods of time.
The AESO works with industry to coordinate planned outages so that they can manage the system requirements, with a reliance on industry to share the information to the media. The AESO also issued a news release asking Albertans to voluntarily reduce electrical usage.
As the manager of the grid, it’s AESO’s job to anticipate and plan for demands on the system. AESO has operating policies and procedures in place to manage contingencies and worst-case scenarios. Although relatively rare, it is possible that similar outages could occur in the future.
The last time the AESO asked Albertans to reduce electricity consumption was six years ago in July 2006. On that day there were a number of unexpected generator outages and a lightning strike on the Alberta to B.C. transmission line, which resulted in the additional unexpected loss of electricity being imported from B.C.
As demonstrated by the events on Monday July 9th, our province’s appetite for energy is high and is only expected to grow. We need a robust generation and transmission system to ensure we can generate what we need and bring it to where it is needed. A robust transmission system ensures that generators can deliver electricity to consumers, helping increase investor confidence, meaning more companies want to build generators in Alberta. Think of generation as a distribution centre. Without the proper transportation infrastructure, no one would build it.
During a short period of time, the wholesale pool price rose, but only a small number of commercial users were impacted by the temporary spike.
Residential consumers do not pay the wholesale pool price. If a consumer has not signed a contract for their electricity use, they pay the variable rate. This electricity is procured 45 days in advance.
If a consumer has signed a contract for their electricity use, they pay a fixed rate for electricity.
Most industrial consumers choose to hedge some or all of their power and are not exposed to the real time pool price.