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CEA says generators must have flexibility while phasing out coal

November 22, 2016 | By Anthony Capkun

Sergio Marchi, president & CEO, Canadian Electricity Association. Photo courtesy CEA.

November 22, 2016 – “[The Canadian Electricity Association] has previously communicated to the [federal] government its concerns regarding the potential impacts, such as rate increases, that an accelerated coal phase-out may have on the regional economies reliant on coal-fired electricity,” said CEA president & CEO Sergio Marchi in a statement responding to the Government of Canada’s announcement regarding the accelerated transition away from traditional coal-fired power.

Marchi says individual electricity companies “must have the flexibility” to:

• Minimize the impact on Canadians’ electricity bills

• Maintain safe and reliable power to customers

• Safeguard the investor confidence required to continue this transition

“While it is too soon to know if these mechanisms will be sufficient, flexibility is the key to achieving the outcomes that Canadians want—GHG emission reductions and better air quality—with the least cost and disruption to their lives and livelihoods.”

Marchi added he is heartened to see three specific flexibility mechanisms embedded in the announcement: equivalency agreements, the use of the Canadian Infrastructure Bank to finance projects, and the conversion of coal plants to gas.

“[This] announcement provides clarity and a regulatory framework to allow the conversion of our coal fleet to gas,” said Dawn Farrell, president & CEO of TransAlta. “These are low-cost investments that could lengthen the average life of our coal fleet by up to 15 years, and allow our existing coal fleet to be transformed to the lowest-cost source of capacity in the Alberta market.”

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