Weekly Energy Charts
November 25, 2022
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Featured Stories
A Made-in-Alberta Climate Plan
Andrew Leach
A little trip down memory lane for me this week, as it was seven
years ago on November 22, 2015 that I got to see a plan I’d helped
develop shaped into policy. As many of you know, I chaired Premier
Notley’s Climate Leadership Panel, which recommended a lot of the policies
implemented by her government. Many of those policies remain in
place today. Of them all, I think I’m most proud of the carbon pricing
framework (now a part of federal policy under the Greenhouse Gas
Pollution Pricing Act) and the impact of our policies on power
sector emissions in Alberta (see below).
Dividing the pipeline pie
Kayla Layden
Enbridge announced increased apportionment along the mainline this week, which is likely to leave more oil in Alberta and have negative impacts on the already discounted price of Canadian heavy oil. The new apportionment levels are the highest since November last year.
Apportionment is typically higher in the winter when Canadian production is at its highest, and higher proportions of diluent have to be added, increasing volume. The current levels are still well below historical peaks, but they come at a time when Canadian heavy oil is already trading at a significant discount. The differential grew significantly in October, and some experts do not expect it to improve until late 2023 when the Trans Mountain pipeline expansion comes online. Canadian heavy crude prices have been impacted by unplanned refinery outages in the U.S. Midwest, concerns around shipment on the too-dry Mississippi River, high natural gas prices, and releases from the U.S. Strategic Petroleum Reserve, which have been putting negative pressure on WCS prices for months. The differential was almost US$30 this week, close to its largest since 2018.
UK Tidal Power
Marc Vermette
Unlike traditional tidal energy generation through barrages, where turbines are mounted in walls, tidal stream turbines are directly lowered into strong tides within specific sea locations.
Global marine power capacity breakdown, 2020 (MW). Credits: ENERGYMONITOR.
The cost of tidal stream power generation has fallen 40% since 2018.
Because of this, we see increasing potential in this energy source that generates power from something very predictable and omnipresent: the changing of the tides.
Offshore Renewable Energy Catapult, a government research centre, forecasts that prices of tidal stream energy may drop below those of nuclear power by 2035.
Simon Cheeseman, a researcher, stresses the importance of facilitating the research and development of tidal energy.
Active tidal power plants, sized by capacity (MW). Credits: ENERGYMONITOR.
He compares its potential development to the successful history of offshore wind power generation, which has gone from generating energy for 4% to 33% of UK homes in only 11 years.
Solar Power in India
Marc Vermette
In 2021, India’s prime minister Narendra Modi pledged that they would hit net zero by 2070, (20+ years after many of the Western countries).
The largest solar farm in the world (as of 2019), Bhadla Solar Park, located in India’s northeast, has grown to cover a 5,700 ha desert.
Solar energy capacity in India from 2009 to 2021 (in megawatts). Chart credits: Statista.
This solar farm currently generates enough electricity to power 4.5 million homes, and has contributed to the ~44% YoY growth of the country’s solar energy generation.
Mohua Mukherjee, an economist at the Oxford Institute for Energy Studies, discusses the project’s success despite India’s lack of “experience” and “regulations” at the time of construction: “solar panels were commercially viable in 2013 in a lot of places, it was just that the cost of generation was not competitive [compared to coal] in places like India.” According to Mukherjee, “the cost of technology has come down so much that it’s [now] incredibly viable.”
CAOEC State of the Industry
Kayla Layden
The Canadian Association of Energy Contractors (CAOEC) held its State of the Industry Conference this week in Calgary and touted an optimistic outlook for the coming year.
CAOEC CEO Mark Scholz discussed several areas of growth predicted in the CAOEC’s forecast for 2023. The forecast projects 6,409 new wells in 2023 for an approximately 15% increase year-over-year. CAOEC also expects a year-over-year increase of 5,400 jobs for a total of 42,350 people employed directly and indirectly by the drilling sector in 2023. The growth is expected to come as the Trans Mountain pipeline expansion and Coastal GasLink project are completed, increasing capacity. Drillers are also expecting to get a boost from emerging energy transition fields like helium, in-situ hydrogen, mineral extraction, and carbon capture utilization and storage.
Alberta Premier Danielle Smith gave the keynote speech. Like Scholz, she talked optimistically about the outlook for next year and expressed the government’s support of the industry. Smith touted the oil industry’s importance for the Alberta and Canadian economies, and argued that oil and gas demand will remain for decades, and, therefore, production must as well, albeit in a greener form through emissions reductions technology. The Premier also discussed the emergence and possibilities of growing clean hydrogen production and increased activity along the natural gas value chain.
France’s First Off Shore Wind Farm!
Yousaff Habib
France has completed construction of their first commercial offshore wind farm, and it is now in full operation. The project, which has been in the works since 2012, cost roughly 2 billion Euros. Consisting of 80 turbines, the project has a capacity of 480 MW, and should generate enough energy to power 400,000 homes. Interestingly, the project was completed in partnership with Enbridge, Alberta’s energy infrastructure giant.
The Saint Nazaire Offshore Wind Farm
Enbridge is best known for oil and gas projects, but like other companies in the space, Enbridge has an increasing stake in renewable power. Enbridge has a 25.5% stake in the project, and has also partnered with the Government of France on three other projects in Fecamp, Calvados, and Provence Grand Large. Given the energy crisis that Europe is facing, the project will have a considerable impact. For more reading, check out this report!
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