Lonsdale Energy Corp'

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• Lonsdale Energy Corp.
• Lessons Learned and Beyond
• A Presentation to Sustainable Communities Forum
• Glenn Stainton Ben Themens
• March 6, 2008

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History of LEC

• Late 1990s Planning began on waterfront areas
  for 1.9 million square feet of mixed use,
  residential and commercial space on what was then
  City-owned land.
• 1998 First feasibility studies for district
  energy
• Investigated several options including
  geothermal, conventional hot water or steam
  technology, cogeneration and high efficiency
  boilers as well as business as usual case
• High efficiency hot water systems seemed best
  from environmental, technical and financial
  perspectives

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History of LEC (continued)

• Beginning of the decade The Breakthrough
• Use of mini-plants instead of a large central
  plant
• Requires less capital initially as the plants are
  added to the system as demand grows
• Provides flexibility as each plant can use the
  most appropriate technology available at time of
  construction

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Business Model
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• Lower Lonsdale
• first building was connected in 2004

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• LEC System has now expanded
• to include the Lonsdale Corridor

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Pre-insulated pipe imported from Denmark with
self-monitoring leak detection system.
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Implications for the Building

• More in-building leasable space
• Lower mechanical equipment costs
• Can be cost neutral
• Excellent marketing feature
• Potentially higher property value
• Less responsibility
• No major replacement costs
• Increased reliability
• Potentially more competitive rates

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District heating tariff how it worksThe theory

• A fixed charge
• Covers fixed costs such as administration and
  capital costs that do not vary with demand
• Based on capacity reserved by the customers.

• A variable charge
• Covers variable costs such as fuel, electricity
  and portion of maintenance cost that varies with
  demand.
• Based on the amount of heat consumed by
  customers.

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District heating tariff how it works

• Commodity Charge
• Variable charge of 0.04498 per kilowatt hour of
  heat delivered (January 08)
• Covers the cost of gas purchases and adjusted to
  follow Terasen Gas Rate 3
• Takes into account system efficiency and
  purchasing power

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District heating tariff how it works

• Meter Charge
• Fixed monthly charge of 299.34
• Covers the cost of the customers heat exchanger
  meter and metering and invoicing

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District heating tariff how it works

• Capacity Charge
• Fixed monthly charge of 2.93 per kilowatt of
  capacity reserved by customer (determined by
  P.Eng.)
• Covers all costs except gas purchase and customer
  specific equipment (meter, HX)
• 20-year financial model - 5 rate of return on
  City investment

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District heating tariff how it works

• Service Connection Fee
• 20,000 plus 30 per kilowatt of capacity
  required by a customer (determined by P.Eng.)
• Ensures that developers contribute as they are
  saving by not providing a boiler room
• Provides an incentive to build energy efficient
  buildings to decrease capacity requirements

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Lessons Learned

• Diversity of building loads and over-sizing by
  building engineers means lower capacity than
  predicted
• Temperature drop less than 1ºF / km
• Low temperature system not common so some issues
  with building designers
• Building commissioning is critical

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Lessons Learned

• Expect the unexpected
• Administration / Organizational processes
• FCM Loan and Grant Negotiations
• Announcement November 2003
• First Disbursement December 2005
• Request to extend the service area June 2006
• Amendment to extent service area Sept. 2007
• PST
• Continued efforts to ensure level playing field

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Lessons Learned

• Expect the unexpected (Contd)
• Public Relations
• Communicate with customers
• Communicate with the public
• Communicate with other organizations
• e.g. BC Hydro, Conferences

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Lessons Learned
Citys/LECs view on BC Hydro energy The
Provinces hydro-electric resource is of
extraordinary value, especially in an e-commerce
age, and should not be consumed in very low grade
applications such a space heating in developing
and densifying urban centres
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• The future incorporate green energy such as
  solar

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• Use of Geoexchange Systems

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Ocean-Source Geo-Exchange
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Future challenges in existing buildings

• There is a large existing building market for
  district energy systems.
• Metering consumption at the suite level will
  typically reduce energy consumption.
• Potential 30 reduction

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Implications for City or Community

• Consider District Energy systems with appropriate
  planning choices like high density
• Reduced GhG emissions
• Local energy independence

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• Thank you
• For further information
• www.LonsdaleEnergy.ca