Getting Canada’s electricity grid to meet climate goals is achievable: reports

There are problems with building the big electricity projects that Canada needs to meet its climate commitments– but these problems can be solved in simple, practical and achievable ways, according to two new reports published by Electricity Canada. 

Electricity Canada developed two reports that look at the challenges to building the infrastructure needed to bring the electricity grid to net zero by 2035 and the Canadian economy to net zero by 2050. They investigate the problems from two different, but interconnected perspectives: the perspective of the regulators, and the perspective of those who are doing the building. 

The first of these reports, “Build Things Faster” identifies the barriers to building infrastructure quickly in Canada, which range from the limited capacity of permitting and regulatory bodies to assess and approve applications, to problems with planning large-scale interprovincial projects. From there, Electricity Canada worked with its members to develop recommendations for government and regulators to fix the biggest obstacles to building, including: 

  • Coordinating federal project permitting and approvals through a single central federal office;
  • Building capacity for regulators to deliver on net zero goals in their decisions, promptly and effectively;
  • Implementing the “One Project, One Approval” framework described in Budget 2023. 

This report was based on months of work performed by Dunsky Energy + Climate advisors, who interviewed experts from across Canada and scanned for best practices and provided case studies from seven jurisdictions with distinctive regulatory approaches. 

(left to right) – Raegen Bond of Dunsky Climate + Climate advisors, Francis Bradley of Electricity Canada and Julia Muggeridge of Electricity Canada launch the “Build Things Faster” report

The second of these reports, “Back to Bonbright: Economic regulation fundamentals can enable net zero” brings regulators back to first principles, literally. Namely, the principles enshrined in 1961 by James C. Bonbright’s book Principles of Public Utility Rates, a work that has informed public utility investment and building for the past 60 years.

Regulation is the backbone of any large-scale public investment, and Bonbright’s principles for regulation are the foundation of public utility pricing theories and policies and form the basis of the rates the public pay utilities. However, such principles pre-date concerns about climate change. This new report states that Bonbright’s principles can indeed work in a world driven by concerns around climate change and net zero. The report discusses different options and regulatory mechanisms that can enable regulators to support technologies that can help the world of 2023—and into the future. 

“In our recent state of the Canadian electricity industry report, we talked about how if we want to build a clean, reliable and affordable electrical grid, we need to start building now. Which is difficult when you consider that a couple of years ago the World Bank ranked Canada 64th in the world for ease and speed of obtaining construction permits,” said Francis Bradley, CEO of Electricity Canada. “Both of these new reports demonstrate there are achievable solutions to this. We can implement processes to fix the things that slow down major federal projects. We can also provide regulators with needed clarity that the cherished principles that inform their work can, and should, embrace the reality of net zero. Both of these two new reports show that we can build things now—and build things faster.” 

Brandon Ott of Utilis Consulting launches the report “Back to Bonbright”
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