Canada’s North struggles to ditch diesel

Solar and wind power promise few gains for a generator-dependent population

July 01, 2011

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Illustration by Douglas Jones

Covering some 1.9 million square kilometers of land but with only 33,000 residents, the territory of Nunavut is mostly devoid of evidence of the imprint humans have left on the planet. But there is at least one area in Nunavut where that imprint can’t be denied: electricity generation. The territory is 100 per cent dependent on diesel to generate electricity, a reality its residents, business and political leaders would desperately like to change. “It’s critical to reduce this territory’s dependency on fossil fuels,” says Peter Mackey, president and CEO of Qulliq Energy, the Crown corporation responsible for delivering power to Nunavut’s 11,000 residential and commercial customers.

Mackey thinks it’s critical because, as a northerner, he knows the price of electricity creates a heavy financial burden in this region. It is a major contributor to the high cost of living in Nunavut and other remote communities across Canada. According to Natural Resources Canada, there are more than 300 isolated communities in the country that rely on diesel generators for electricity. Almost half of them are in Canada’s three territories or along the northernmost regions of the country’s provinces.

With organizations like the International Energy Agency predicting demand for oil will reach 99 million barrels a day by 2035, the cost of oil and the products derived from it – like diesel fuel – aren’t about to get any cheaper. In 2009-2010 Qulliq Energy used 45 million liters of diesel fuel at a cost of $39 million. There is also an environmental cost in using diesel generators that spew copious amounts of greenhouse gases into the atmosphere. Northerners claim they are seeing the effects of climate change faster than other parts of the world and ridding themselves of diesel-generated electricity could help reverse that unwanted trend.

The question is what can displace diesel electricity in Canada’s northern outposts? Can the North’s territories go green when it comes to electricity generation? Affirmative answers to those important questions can’t be given right now. The Yukon is the greenest of Canada’s three territories by a wide margin – 94 per cent of its electricity is generated by hydroelectricity. Nunavut isn’t so lucky with all 25 of its communities using diesel generators. The Northwest Territories isn’t in much better shape; 26 of its 33 communities are powered by diesel-generated electricity.

If Nunavut and the N.W.T. are ever going to ditch diesel, hydro power is the most realistic option to replace the fossil fuel. One reason for that is the vast hydro potential both territories possess. The N.W.T. has approximately 11,000 megawatts (MW) of hydro potential, and Qulliq Energy has identified significant hydro opportunities in each of its three regions – the Baffin, Kitikmeot and Kivalliq.

The other reason hydropower holds such promise is that neither territory can afford to use its limited financial resources to explore less reliable alternatives like solar and wind. It is government that must invest in electricity infrastructure in the North because the private sector isn’t keen to finance multimillion-dollar electricity projects in a region with a population of 100,000 and an equally small commercial customer base. “Hydro is our focus,” Mackey says. “We’ve avoided wind and solar because Qulliq Energy has a limited amount of funds to test and install renewable energy options on speculation.”

Qulliq’s pet project on the hydro front is the Jaynes Inlet and Armshaw River development, which would supply 20 MW of hydropower to the city of Iqaluit, Nunavut’s largest community with a population of 7,250. Mackey says the project could displace 25-30 per cent of diesel fuel consumption in Nunavut. It is still in the embryonic stage, however. A feasibility study must be done, which will cost $12 million to complete. Qulliq Energy doesn’t have the funds to front the entire cost, so a proposal was given to the federal government to see if it can provide some financial backing for the study.

Money remains the biggest stumbling block to Nunavut and the N.W.T. realizing their hydroelectric dreams. Hydro projects don’t come cheap, with the N.W.T.’s Taltson hydroelectric project being a case in point. The territorial government has been backing the proposed 36-56 MW expansion of the Taltson hydroelectric system to supply hydro power into the diamond mining district northeast of Yellowknife, the territory’s capital. But Taltson has a $700-million price tag and proponent Dezé Energy Corporation Ltd. has so far been unable to secure the capital to build it.

The Talston expansion wouldn’t get any of the N.W.T.’s communities off diesel electricity initially, but the N.W.T. government says it would cut territorial greenhouse gas emissions by 15 per cent as the diamond mines transition from diesel-generated power to clean hydro power. Building Talston could also improve the economics of other potential mining projects in the mineral-rich Slave Geological Province by eliminating the need for new mines to use expensive diesel power. “There are about seven or eight mining projects on the horizon that need cheap power, so Taltson is very important to our future,” says Bob McLeod, the N.W.T. government’s minister of industry, tourism and investment.

Much like Qulliq Energy’s Mackey, McLeod says the federal government needs to step up before the North can move away from diesel-generated power. “We’ve got to get the federal government engaged as a partner on some of these larger hydro projects,” he says. “So far, we haven’t been able to do that.”

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Comments

  • Joe Dusseault

    Has natural gas been considered as an alternative fuel source to diesel for the engine driven power generators or natural gas fuelled co-gen for larger power/heating applications?

    • Darren Campbell

      Joe:

      Natural gas has been considered in the NWT to replace diesel power with natural gas. Nunavut hasn’t and I’m pretty sure the Yukon hasn’t either – but it’s mostly on hydro anyway.

      If you are interested, go to this link: http://www.iti.gov.nt.ca/publications/#mackenziegas and check out the report that’s titled” Feasibility Study of Conversion of Diesel Power Plant to Natural Gas in Fort Simpson.

      The catch is they’ve determined it’s only feasible in three communities: Fort Simpson, Tulita and Fort Good Hope and it’s all dependent on the Mackenzie Gas Project getting built, which is in deep trouble.

  • Stephen Envoy

    Hi Darren,

    Thanks for the interesting article. I’m doing some research into renewable energy as supplement for diesel-generated electricity in remote northern communities. Would you be able to direct me to any resources that indicate the cost and volume of diesel that is currently used in remote, northern communities in Canada.

    Any help would be much appreciated.

    Stephen

    • Darren Campbell

      Hi Stephen:

      Thanks for your email. I don’t have any links for you off the top of my head. I will do a little checking. Sometimes the various provincial/territorial government websites include these statistics.

    • Darren Campbell

      Hi Paul:

      Thanks for taking the time to write down those other ideas.