Project Green District Energy Feasibility Study - Partners in Project ...

TRCA Pearson Eco-Business Zone District Energy Feasibility Study 10 April 2012
• Public-Private Ownership – the municipality (Peel and/or Mississauga) and another public
sector body could partner with a private-sector partner (i.e. Enbridge) to develop the project
in partnership.
• Private Ownership – an interested private sector company could develop the project and
provide the municipality annual easement fees for use of its right-of-ways.
• Public Ownership – the municipality and another public sector body could develop and
implement the project and operate it as a utility similar to water and wastewater services.
Regardless of the ownership model, the Partners in Project Green District Energy Team agreed
that a champion from the local municipalities is critical to the success of the system – as the
public trust and influence of the local municipality is important in ensuring buy-in of potential
customers; while access to easements, proper permitting and favourable development
conditions, are crucial to the facility’s development.
Regulatory Considerations
The district energy system is not expected to face significant regulatory or legal obstacles. If
federal funding is accessed it may trigger an Environmental Assessment screening. It would not
be expected to trigger a provincial Environmental Assessment.
Municipal easements and permits would be required for the development of a system.
Risk Assessment
There are a number of risks that the development of the district energy system could face,
including:
• Customer Connections - the primary risk with the development of this district energy
system is that customers will not connect. A concerted marketing campaign to educate
potential customers and obtain their intent to connect will be required before development.
In addition, new development in the vicinity of the proposed system should be educated and
encouraged to connect as part of the development process.
• Natural Gas Price Volatility - rates can be structured with a fixed rate and variable rate
component so that customers take-on or share-in the volatility of the energy prices. In the
extreme, district energy systems are resilient to changes in fuel type and can typically be
modified for a new fuel source more cheaply than individual buildings.
• Land Availability - suitable and affordable plots of land appear to be available to host the
central thermal facility, however the owners would need to be identified and availability and
price confirmed.
• Project Financing - availability and cost of capital will be key constraints for the successful
development of the system.
Economic Conditions for GTAA’s Central Utilities Plant to Supply Thermal Energy
Currently the GTAA has a CUP that consists of boilers and a CHP plant. While the boilers are
limited by their physical capacity and GTAA’s demand for heating and cooling, the CHP is
currently limited by market prices for electricity.
The CHP plant is dispatched when it is profitable based on market rates for electricity and the
cost of natural gas. In order to utilize GTAA’s CHP as the thermal source for the proposed
district energy system, GTAA would need improved contract terms so that it is profitable to run
ES-iv