Corporate Responsibility Report 2013

Greenhouse Gas Emissions

Greenhouse Gas Emissions

We are managing GHG emissions for the near, medium, and long term. Near-term practices focus on:

  • Renewables: We are investing in the development of renewable power sources:
    • Capital Power has invested over $1 billion in three wind projects that have been commissioned between November 2012 to November 2013.
    • Capital Power, in partnership with Pattern Renewable Holdings Canada ULC and Samsung Renewable Energy Inc., is currently constructing the 270 MW K2 Wind facility in Ontario.
    • Our facilities in Southport and Roxboro, North Carolina, produce Renewable Energy Certificates (RECs). Both facilities blend a fuel made from recycled tires, biomass, wood waste, and coal. Our North Carolina RECs are generated from a portion of the tire-derived fuel and all of the biomass. North Carolina has a mandatory renewable portfolio standard, and the RECs are marketed to state compliance buyers.
    • Our Cloverbar Landfill Gas facility, one of our carbon offset projects, uses decomposing organic material which produces methane gas that is captured and burned to produce electricity. Methane is 21 times more powerful a greenhouse gas than carbon dioxide, and transforming it into electricity allows it to be used as resource rather than as a pollutant in the atmosphere.
  • Compliance: Many of our facilities are already required to reduce or offset their greenhouse gas emissions. In Alberta, nearly 650,000 tonnes of Capital Power’s GHG emissions were offset in 2013. Capital Power is also developing new sources of power generation to replace older coal-fired units that will be retired due to Canadian federal regulations. By capacity, the regulation will close 14% of Alberta’s coal fleet by 2019, rising to 28% in 2027 and 59% by 2029.
  • Offsets: We are investing in a portfolio of carbon offset projects and participating in the development of carbon markets to meet current and future requirements. In 2013, Capital Power invested $2.6 million in emission offsets. Since 2007, Capital Power has registered nearly 10 million tonnes of carbon offsets for the Alberta market.
  • Efficiency: We seek continuous improvement in the efficiency of our power generation fleet.

To lay the groundwork for medium- and long-term transition to lower-emission and zero-emission technologies, we also pursue:

  • Scientific and engineering research: We support university scientists and engineers in both basic and applied research, including through our partnership in the University of Alberta’s Canadian Centre for Clean Coal/Carbon and Mineral Processing Technologies.

Capital Power's Greenhouse Gas Emissions

Across our North American operations, greenhouse gas (GHG) emissions were 9.74 million tonnes carbon dioxide equivalent (tCO2e) in 2013 compared to 11.40 million tCO2e in 2012. Gas-fired generation has about half the greenhouse gas intensity of coal-fired generation. Due to the sale of the New England natural-gas facilities, our overall GHG emissions and net generation were lower, but we sustained a higher coal-to-gas ratio in our fleet resulting in a higher emission intensity in 2013.

Year-over-year changes in GHG emissions, emission intensity, and offsets are generally caused by:

  • Changes in power production volume (the length of maintenance outages at thermal facilities can have a significant impact on single-year results from individual facilities)
  • The introduction of new technologies that increase efficiency or decrease emissions
  • Changes in emission reduction or offset requirements
  • Changes in our generating fleet (the development and acquisition of cleaner facilities add to emission volumes while decreasing emission intensity (i.e. natural gas, biomass, and tire-derived fuel facilities), while the addition of non-emitting sources (wind energy) leaves emission volumes unchanged and decrease emission intensity)

Our emissions profile

The fuel mix of our fleet includes coal, solid fuel (tire-derived fuel and biomass), natural gas, and wind. Generation from coal and solid fuel creates higher and more types of emissions than natural gas, while wind has zero emissions. The most obvious determinant of emissions is the generation output, or how many hours per year the facilities operate.

The data

The data below represents the entire plant - not our financial share of the operation. This includes Genesee 3, co-owned with TransAlta, and Genesee 1 and 2, whose capacity and output is sold under an Alberta Power Purchase Agreement to the Alberta Balancing Pool. Capital Power holds the operating permit for these facilities.

Data from Keephills 3, Joffre, and our Sundance Units 5 and 6 power purchase agreement are not included because we do not hold the operating permits.

Data provided in the below section is for the facilities that we held the operating permit for as of December 31 of each respective year.

The Genesee Generating Station provides 1,266 MW of base load power to the Alberta electricity grid, which is enough energy to supply approximately 1.1 million homes (based on average household energy use).

Emissions Intensities - Greenhouse Gases 1

By Country Greenhouse Gases2,3
(tonnes CO2e/MWh)
Year 2011 2012 2013
Canada 0.91 0.90 0.81
U.S. 0.43 0.43 0.59
All 0.75 0.73 0.79
  1. Emissions intensities include only power generation operations. Emissions intensities do not include emissions from indirect sources, such as those resulting from electricity usage at our offices. Intensity is calculated using the net production (MWh) from all Capital Power facilities based on operating permit, including all renewable and fossil fuel facilities.
  2. In accordance with the Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard [World Resources Institute and World Business Council for Sustainable Development (2004)], carbon dioxide released at facilities from combustion of biomass and landfill gas are not included in emissions totals and intensities.
  3. GHG emissions intensities are stack emissions only and do not reflect the impact of offsets.

Total Air Emissions - Greenhouse Gases

By Country Greenhouse Gases
(tonnes CO2e)
Year 2011 2012 2013
Canada 9,626,000 8,997,000 9,278,000
U.S. 2,293,000 2,400,000 466,000
All 11,919,000 11,397,000 9,744,000
Values represent direct emissions from power generation operations.

Greenhouse gas emissions

Greenhouse gas emissions and intensity from FOSSIL FUEL facilities

2011 2012 2013
Values represent direct emissions from power generation operations.
Greenhouse gases (tonnes CO2e) 11,529,000 10,906,000 9,277,000
Net production MWh 15,108,000 14,633,000 10,494,000
Fossil-fuel emission intensity (tonnes CO2e/MWh) 0.76 0.74 0.88

Greenhouse Gas emissions FLEET-WIDE and intensity from Canadian and U.S. facilities

2011 2012 2013
Greenhouse gases (tonnes CO2e) 11,977,000 11,397,000 9,744,000
Net production MWh 15,939,000 15,626,000 12,297,000
Fossil-fuel emission intensity (tonnes CO2e/MWh) 0.75 0.73 0.79

Reducing emissions through offsets and licensing

Offsetting emissions in Alberta

Our Alberta plants are subject to the Specified Gas Emitters Regulation (SGER) under the Climate Change and Emissions Management Act (Alberta). SGER requires companies that emit more than 100,000 metric tonnes of carbon dioxide equivalent (metric tCO2e) to reduce the emission intensity of a facility by 2% per year to a maximum of 12%, compared to the calculated baseline intensity for the specific facility. These companies may choose to purchase carbon offsets equal to their reduction requirements as one of four compliance mechanisms. Alternative compliance strategies would be to purchase Emission Performance Credits from other companies, implement performance improvements, or pay $15/tonne into the Climate Change and Emissions Management Corporation’s Technology Fund, widely referred to as the “Tech Fund”. As the risk-free compliance option, the price of a Tech Fund contribution sets a cap on the market price for SGER reductions. In 2013, Capital Power paid into the Tech Fund to meet compliance.

The baseline emission intensity for Genesee 1 and Genesee 2 is the average emissions intensity from 2003-2005. However, for new facilities, such as our Clover Bar Energy Centre, the baseline emission intensity is based on the facility’s third full year of commercial operation. In 2013, under SGER, Genesee 1 and Genesee 2 were subjected to a CO2e intensity reduction target of 12%, and Genesee 3 had a CO2e intensity reduction target of 10%. 2013 was the second year that our Clover Bar Energy Centre was subjected to SGER GHG reduction targets of 4%.

In addition to SGER, we are also required to reduce our share of Genesee 3’s GHG emissions by approximately 53%, which is to the level of a natural-gas combined-cycle plant. Offsets have been retired every year since commissioning in 2005 and will continue to be retired to meet future obligations. In 2013, Capital Power retired 641,466 tonnes of GHG offsets in Alberta, which were created primarily from coal mine methane projects.

Capital Power also retired 8,280 Canadian renewable energy credits against our power consumption for the Edmonton and Calgary offices for 2013, and we retired 663 Canadian-based offsets against our gas consumption for the Edmonton and Calgary offices for 2013, resulting in a total of 2,679 metric tonnes of CO2e being offset. We plan to continue the practice of offsetting our carbon footprint for our office space in Edmonton and Calgary in subsequent years.

Leading Emission Offset Practices

  • In 2013, Capital Power invested $2.6 million in emission offsets. Since 2007, Capital Power has registered nearly 10 million tonnes of carbon offsets for the Alberta market.

We have been acquiring offsets for almost a decade and have entered into more than 35 offset purchase agreements.

We have expertise in the origination, purchase, and sale of verified emission offsets. We also developed two of the Alberta Offset System Quantification Protocols.

Capital Power has been active in the Alberta SGER emissions offset market since 2007 and has used offsets for 100% compliance for 2008-2012. Capital Power continues to be active in the Alberta offset market and anticipates continuing to use offsets to meet future compliance obligations. Emission offsets are audited and verified by independent third parties.

We continue to invest in emission offset markets and have become an active buyer of Climate Reserve Tonnes (CRT) offsets. We are also an active member of the International Emissions Trading Association.

We have purchased offsets from a variety of Alberta and CRT projects in 2013. Some of these project types include composting, ozone-depleting substances, forestry, agricultural methane, no-tillage agriculture, and landfill gas.

Future emission reductions from coal unit retirements

  • Canadian regulations will close 14% of Alberta’s coal-fired generation by 2019, rising to 28% in 2027 and 59% by 2029, which will significantly reduce future greenhouse gas emissions.

Capital Power has long supported Canadian targets and regulations to mandate emission reductions from coal-fired power generation, including national and provincial regulations that would significantly reduce GHG and air emissions from coal-fired electricity plants, to help Canada achieve its Copenhagen commitment to lower GHGs.

The Canadian federal regulation mandates the closure of coal-fired generation facilities in Canada once they have reached a defined end of life and prohibits new coal-fired generation after 2015, unless units are either retrofitted or constructed to achieve carbon capture and storage. In the near to medium term, it is anticipated that units will be retired and replaced with alternative forms of generation, including natural-gas-fired generation.

The Canadian regulation mandating orderly coal unit retirements provides certainty for generators, accelerates carbon reduction, avoids stranded investment, and facilitates planning of cleaner replacement generation.

In Alberta, for example, the regulation signals the timing and volumes of replacement baseload generation that will be required and provides certainty about greenhouse gas reduction. By capacity, the regulation will close 14% of Alberta’s coal fleet by 2019, rising to 28% in 2027 and 59% by 2029.

Replacement generation for all the pre-2025 coal unit retirements is already in development, and includes the proposed Genesee Generating Station Units 4 and 5 - a baseload gas-fired facility.

  1. See Report Scope for an explanation of which facilities and offsets are included in these totals. For example, no emissions or offsets are included with respect to Capital Power’s 50% ownership interest in Keephills 3 because Capital Power does not hold the operating permit; however, 100% of emissions and offsets are included from Genesee 3, where Capital Power is the operator, despite Capital Power owning only 50% of Genesee 3. This approach also aligns with Canadian federal reporting requirements, where operators report 100% of facility emissions rather than emissions based on their proportional ownership interest.

Report Tools