Cogeneration: Potential Impact on the Competitiveness of Canada's Pulp and Paper Industry
DOI:
https://doi.org/10.15173/esr.v5i2.298Abstract
Canadian manufacturers in several energy-intensive industries face a serious competitive disadvantage by not having the same opportunities as their American counterparts to install cogeneration facilities. Industry and Science Canada (ISC) worked closely with 29 pulp and paper mills to document the potential benefits of enabling Canadian firms to sell excess cogenerated power to utilities at the utilities' avoided cost rates. Assuming that the utilities were in need of additional base-load power, the benefits to Canadian firms would be great (approximately 3% of sales, or about $55 million/mill). In essentially all cases, these benefits could be at-tained without resorting to crosshauling subsidies (i.e., selling power at a high avoided cost rate and repurchasing the same quantity at a lower average industrial rate).
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