Steve Baker
President
Natural Gas in Ontario’s Energy Mix Seeing The Bigger Picture
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Union Gas – A Spectra Energy Company
Robust natural gas infrastructure
Industry Economic Contributions
• Total Ontario natural gas customers = 3.4 million
• Ontario natural gas utilities employment = 4,300
• Canadian natural gas sector employment = 172,000 (Canada 2010)
• Ontario capital investment = $750 million to $1 billion annually
• Taxes paid by Ontario gas utilities = $298 million in 2011 (Municipal, Prov., Fed.)
Waterloo/Brantford District
Distribution Area: From Port Rowan, in the south, to Wiarton in the north.Pipelines: 8,400 kilometresCustomers: 263,350Property Tax Paid: $10.6M in 2012District Offices: Waterloo, Guelph, Cambridge, Brantford, Simcoe, Hanover, Owen SoundUnion Gas Employees: Waterloo/Brantford District – 143Brantford Call Centre – 127
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Ontario’s Primary Energy Mix
Natural gas: a critical fuel for Ontario
(TJ/%)
Natural Gas77571132%
Total Coal156221%
Total refined petroleum products99461441%
Coke oven gas219331% Coke
758153% Steam
31200%
Primary electricity, hydro and nuclear47198720%
Gas plant natural gas liquids (NGL's)407982%
Natural Gas77571132%
ResidentialPercentage of customers: 92%
Annual throughput: 34%
Power Generation Plants: 59% (2/3 of Industrial Consumption)
IndustrialPercentage of customers: 1%
Annual throughput: 45%
CommercialPercentage of customers: 7%
Annual throughput: 21%
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Ontario Power Mix 2012
Natural gas: a key contributor to energy mix
Hydro22%
Natural Gas15%
Nuclear56%
Wind3%
Coal3% Other
1%
Generation by Fuel Type
Nuclear36.2%
Natural Gas27.9%
Coal9.2%
Hydro22.2%
Wind4.2
Other0.3%
Installed Capacity
Electricity Generation from Neighbouring States
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Natural Gas Meeting Peak Day Demand
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Ontario’s Electricity Rates & Surrounding Provinces/States
Ontario’s electricity rates must be competitive
(Based on average residential and industrial consumptionHOEP + global adjustment)
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As energy costs escalate, natural gas remains affordable
Ontario’s Total Residential Bill Prices
(“Ontario Average Electricity” is the average price of all electricity distributors across Ontario as reported by Statistics Canada; HST and Ontario Clean Energy Benefit are not included)
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Natural Gas - Conservation Success
Union Gas conservation programs saved customers $1.4 billion in costs (2007-2011)
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North American Market Dynamics
Western CanadaDecline
2-3 PJ/d
Marcellus/ Utica
Growth8 PJ/d
Gulf Coast
Growth1-2 PJ/d
MidcontinentGrowth1-2 PJ/d
BC Growth
Ontario’s robust infrastructure has a competitive advantage
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Diversifying Ontario’s Natural Gas & Infrastructure Supply
New proposed infrastructure will move more supply to Ontario
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Opportunities for Ontario
• Natural gas prices in Canada have been on a steady decline since mid-2008 due to increasing supply and economic trends
• Residential savings of $275-$400/year due to new shale supplies
• Commercial customer savings of $9,000-$15,000/year
• Industrial customer savings of $10-20 million/year
• $3-5 billion/year in savings to Ontario consumers
Connecting New Communities – rural & remote
Opportunities for Ontario
Power Generation – greater role in fuel mix
Natural Gas for Transportation – heavy duty return-to-base vehicles
Industrial – retain and attract energy intensive industry(steel/petrochemical/fertilizer)
Northern Ontario – mining opportunities
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How Energy Industry, Government and Regulators Can Help
• Get the word out about opportunities
related to natural gas
• Create efficiency
& certainty around energy policy
& regulation
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Thank you
Natural Gas in Ontario’s Energy Mix – Seeing The Bigger Picture
www.uniongas.com www.cleanandaffordable.ca