Saskatchewan: The Unsung Hero of Green Energy?

The oil industry is driving Canada’s first commercial geothermal power project as Saskatchewan pushes on with its 50-percent-renewables goal for 2030

October 31, 2016

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At first glance, conservative, coal-committed Saskatchewan might not seem to be the best place to pitch a renewable energy project as its war with Ottawa over carbon pricing heats up. But still more heat is stored in vast reserves underground in the province, which an alliance between the oil and geothermal industries aims to extract.

In February, Saskatoon-based Deep Earth Energy Production (DEEP) will start drilling as part of an $8 million feasibility/FEED study into what would be Canada’s first commercial geothermal power project. Regina-based MPM Construction Services is investing the money in the project in exchange for equity in DEEP. The work plan and final reporting will be completed by GeothermEx, a Schlumberger company.

Kirsten Marcia, DEEP CEO says the feasibility study will be bankable, allowing debt to be raised to complete the remaining construction of the $45 million project. Iain Harry, Director of Innovation and Clean Energy at government-owned SaskPower says, “We’ve been working with DEEP for a number of years on pre-feasibility studies. Much more work needs to be done but preliminary results suggest that geothermal power generation at a utility scale may be economically and technically viable in southeast Saskatchewan. From SaskPower’s perspective we are very interested in purchasing clean baseload power at a competitive price and understanding the geothermal potential of the Williston Basin.” DEEP and SaskPower are discussing a term sheet for purchase of the power if the final feasibility study leads to the development of the project.

Marcia says DEEP aims to produce the first baseload power in 2.5 years due to the long lead time on turbines. The project currently anticipates 5 MW net power capacity from a 10 MW plant—half the power will be consumed driving the system—which could double if the study shows that’s the best option. Doubling the number of production wells means doubling the size of the plant, but not doubling the installed cost/MW. DEEP’s long-term vision is to build and operate multiple power plants. The bottom-hole temperatures were obtained from nearby oil and gas wells and SaskPower’s recent carbon capture injection wells. “If it weren’t for the oil industry we wouldn’t know about this resource,” she says. Fracking may be required to increase the flow of hot water moving through the aquifer. In the 2014 pre-feasibility study, Calgary-based Enerpro Engineering designed the 5 MW net system with three production wells and two injection wells. It could be the start of a new drilling-based clean energy industry in Western Canada—next door, the Alberta government has given Canadian Geothermal Association a grant to assess the province’s oil wells for geothermal potential via coproduction of oil and heat. At 3,000 meters depth, DEEP’s wells enter the same saline aquifers that store SaskPower’s captured CO2 from a coal-fired power plant. Harry says: “DEEP is using well-understood generation technology at surface. However, there are a number of technical questions that need to be better understood related to the quality of geothermal resource in the aquifer, the permeability of the formation at the bottom of the well and the impact of the very high salinity values of the water on overall performance and lift of the wells and the above ground equipment.”

Kirsten Marcia, however, is convinced that experience gained in the U.S as the largest developer of geothermal power in the world, and the technology that the oil industry has developed in moving high volumes of fluids in Williston Basin, which crosses the border into North Dakota, which is home to a commercial coproduction power plant at an oil well, will help ensure the success of these projects.

In addition to SaskPower’s Boundary Dam CCS power plant, which sends CO2 to oil fields and stores the surplus underground, the firm also runs a Carbon Capture Test Facility (CCTF) at the 300 MW Shand Power station. SaskPower built the CCTF facility in partnership with Mitsubishi Hitachi Power Systems to help innovative companies from around the world test and develop new CCS technologies. “Our goal in developing the CCTF is to encourage innovation in the development of the next generation of CCS technologies and to contribute to the development of a robust and competitive marketplace for CCS that ultimately improves performance and lowers the cost of carbon capture at a utility scale on conventional fossil fuel generation,” Harry says. SaskPower’s world-leading investment in CCS will not only help to cut emissions from its generation fleet in Saskatchewan, it has the potential to be transferred to developing countries particularly in Asia where use of coal fired power generation is rapidly expanding,  he says.

China, Korea and Japan are big coal markets, and China is introducing a national cap and trade system in 2017, to unite its current regional carbon pricing systems.

Today, 25 percent of SaskPower’s generating capacity comes from renewable sources, primarily wind and river-based hydro. By 2030, SaskPower plans to increase its renewable generating capacity to 50 percent by adding at least 1,600 MW of wind and introducing new generation from solar, geothermal and biomass. By 2030, conventional coal is expected to make up just six percent of SaskPower’s total generation capacity. Furthermore, SaskPower is working with the provincial government and the oil industry to use methane produced as a by-product of oil production to generate zero emissions power.

The biggest change will be to focus on solar, Wall says, thanks to “advancements in technology”. The province’s goal is to add as much as 600 MW of solar by 2036 and it’s already started the tender process to build the first utility scale 10 MW solar project in Canada outside Ontario. The immediate goal is to develop 60 MW of solar generation by 2021. SaskPower plans to develop 20 MW through competitive procurement by Independent Power Producers, 20 MW in collaboration with the First Nations Power Authority and 20 MW through a community based approach that will be developed in consultation with stakeholders over the next year.

SaskPower is also working with First Nations on burning wood waste, ‘biomass’, to produce power.

It’s also working with Manitoba Hydro power on cross-border power supply and is evaluating the potential of developing nuclear power from Small Modular Reactors —the province’s uranium account for more than five percent of U.S. generation.

SaskPower’s 2030 goal is to slash its emissions by at least 40 percent of what they were in 2005, while boosting its power generation capacity by more than 50 percent of what it is today. This is the goal of a conservative government that has locked horns with Ottawa over carbon pricing.

kirsten-marcia

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Comments

5 Responses to “Saskatchewan: The Unsung Hero of Green Energy?”


  1. Mike Hogan says:

    Interesting article. I do question several deceiving statements. Like good thing for oil, we found geothermal sites. Its a similar notion as good thing Hitler experimented on humans so we could advance medical science.

  2. Mike Priaro says:

    Commercial? Really?
    While I give them an ‘A’ for effort all right, the $45 million project, plus $8 million feasibility study, “…currently anticipates 5 MW net power capacity.” That’s about $9 million per MW.
    Calgary’s new $1.4 billion Shepard power plant has a capacity of 800 MW, at about $1.75 million per MW.
    It burns 65 mmcfd of natural gas adding $0.130 million/day in costs at $2/mcf.
    Based on the numbers provided in this article, DEEP has a long, long way to go to establish affordable geothermal power.

    • Wayne says:

      Considering SaskPower spent 1.67 Billion on the CCS unit which COSTS energy to run, just to prolong the inevitable demise of coal plants, this project doesn’t seem so bad. The cost should go down as well after the initial project. The first geothermal unit will involve a lot of learning and development, refinement of processes, etc.

      Natural gas wouldn’t be so bad, depending on where we get it. Traditional processes for obtaining the gas are quite dirty, but utilization of the gas to generate electricity is quite clean. I think we could look to biodigesters for gas production, capturing methane waste from manure and food waste normally destined for landfills. There are a number of such facilities already in Canada and they are performing quite well.

  3. Andrew Palans says:

    65mmcfd @ $2/mcf would equal $0.0130 million/day or $13,000/day.