Promoting Green Power in Canada - Centre for Human Settlements

Promoting Green Power in Canada Pollution Probe8. Conclusions, Observations and Recommendations8.1 ConclusionsThe following conclusions have been reachedbased on the research conducted for thisreport:With respect to renewable power this reportasserts that:• The environmental benefits of energygeneration from renewables compared tofossil-fuel based generation are large, butuncertainty exists about the ecologicaleffects of some emerging renewabletechnologies.• Europe is leading the renewable powerfield, both technologically and withrespect to installed generation capacity.• Renewables currently play a small role inCanada’s plans for generation capacityexpansion and the replacement ofobsolete power plants.• Canada’s renewable resources are notevenly distributed across the country, butthe highest potentials appear to exist incoastal Provinces, with ocean-basedresources leading the field, followed bywind and small hydro.• Many renewable resources can be tappedat generation prices approximately 2–3¢/kWh more than combined-cycle gas power.• Renewable power technologies tend tohave stable operating costs relative tofluctuating fossil fuel prices; if renewablesenter electricity markets in substantialquantities, they might form an effectivehedge against unstable and increasingelectricity prices due to changing demandpatterns and international developments.Green power was found to:• Capture a small niche market amonggreen buyers (around 1% of thecustomer base in most countries, but13% in the Netherlands where ecologicaltax reform is the main driver).• Have difficulties penetrating the marketdue to a low awareness level amongcustomers.• Have high marketing costs, resulting insmall financial benefits for renewablepower producers.• Be most successful when green power isoffered at a discount to conventionalenergy sources, whereas marketpenetration is low if customers have topay a premium (i.e., the market beyondmotivated green buyers is price-driven).• Have most potential among largeindustrial and commercial consumersdue to their higher energy use andsmaller marketing costs.• Have a low penetration rate, or even tocollapse, if the default service price wasset too low at the outset of deregulatedmarkets, or if rising wholesale pricesreduced the margins companies couldobtain from mixed green power products.• Have little effect on customer educationwhen offered at a discount as manyconsumers simply chose the cheaperproduct without making consciousdecisions to help improve theenvironment.155