Renewables dominate future electric capacity additions

This article was published by the Canada Energy Regulator on Jan 20, 2021.

Canada’s Energy Future 2020: Energy Supply and Projections to 2050 (EF2020) is the latest long-term energy outlook from the Canada Energy Regulator (CER). The Energy Futures series explores how possible energy futures might unfold for Canadians over the long term under different circumstances.

The EF2020 report analyzed two scenarios, Reference and Evolving. The Evolving Scenario assumes that action to reduce the greenhouse gas (GHG) intensity of our energy system continues to increase at a pace similar to recent history, whereas the Reference Scenario assumes limited action to reduce GHGs beyond policies in place today.

The graph below shows the historical and projected electricity capacity mix for Canada under the Evolving Scenario.

Figure 1. Installed Electricity Capacity 2005 – 2050 Evolving Scenario

Figure 2. Installed Electricity Capacity 2005 – 2050 Reference Scenario

The overall results are similar between the two scenarios, with a few key differences. In both scenarios, coal is phased out and hydro remains the dominant source of electricity. Nuclear capacity retirement and refurbishment schedules are assumed to remain similar in both scenarios.

Total installed capacity is 19 per cent higher in the Evolving Scenario, due to higher electrification of end-use demand, relative to the Reference Scenario. One of the key differences between the scenarios is the much larger additions of solar and wind in the Evolving Scenario.

In 2050, wind and solar capacity in the Evolving scenario is 80 per cent higher than the Reference Scenario. This is because the Evolving Scenario assumes lower capital costs for renewables along with a higher carbon price. Natural gas additions are also 10 per cent higher in the Evolving Scenario, due to both the need for capacity to back up the larger renewable additions and higher overall electricity demand.