Saskatchewan’s Electricity Future

Back in my home province, a legislative committee has begun a public inquiry on meeting future electricity demand. Written submissions and video of oral presentations are available online.

Saskatchewan’s traditional reliance on coal-fired electricity is challenged by concerns about climate change and the prospect of federal charges for carbon emissions. The debate has recently been polarized between proponents of nuclear power and advocates of small-scale renewables. A third option deserves more consideration: large-scale hydro.

Coal

SaskPower, the Crown electric utility, has historically relied on lignite coal. This mode of generation is not only cheap and reliable, but also supports mining jobs in the province.

Of course, the problem is that burning coal (especially lignite) emits huge amounts of greenhouse gas. This dilemma has made SaskPower, the previous NDP government and the current Saskatchewan Party government very interested in clean-coal technology. However, as long as this technology remains unproven, it would be difficult to justify building additional coal power plants.

Indeed, SaskPower has not commissioned a coal plant since 1992. It made essentially no major investments for the rest of the 1990s. The existing power system was adequate for Saskatchewan’s then-docile economy and the provincial government was unwilling to borrow to finance investments.

Over the past decade, SaskPower has met incremental growth in electricity demand from sources other than coal. Since 1999, it has added 458 megawatts (MW) of co-generation at industrial facilities, 172 MW of wind power, and 168 MW of natural-gas generation. As a result, coal has fallen from 60% to 45% of Saskatchewan’s electrical capacity.

Nuclear

Over the next two decades, SaskPower envisions faster demand growth from a stronger provincial economy and most of its existing facilities wearing out. It projects having to rebuild, replace or otherwise acquire 4,100 MW by 2030.

This looming supply gap created an opening for proponents of nuclear power. A year ago, Bruce Power pitched a nuclear reactor in Saskatchewan. The uranium-mining industry makes the province more receptive than most to nuclear development.

But all of the usual objections to nuclear power still exist. Furthermore, Saskatchewan’s grid seems too small to accommodate an economical-scale nuclear plant. SaskPower currently supplies just over 3,000 MW and expects to supply more than 4,000 MW by 2020.

The smallest reactors generate 1,000 MW, and two such reactors would normally be built on the same site to maximize economies of scale. Even assuming robust demand growth, the nuclear option would involve Saskatchewan drawing a quarter or half of its electricity from a single site.

New Brunswick does draw about a quarter of its power from the Point Lepreau reactor, but has a much less dispersed grid. As SaskPower notes, “The SaskPower system is not designed to cope with a large nuclear plant.”

Recent provincial consultations reported overwhelming public opposition to nuclear power. The Saskatchewan Party government, which had been promoting Bruce Power’s proposal, has backed away from it. (Indeed, the Premier may have been backing away from it for some time.)

Renewables

Many on the anti-nuclear side of the debate argue that conservation and small-scale renewable power can meet Saskatchewan’s electricity needs. Indeed, the province has immense natural potential for wind, solar and geothermal power. While Saskatchewan should pursue these solutions as far as possible, they probably cannot provide a complete answer.

SaskPower projects that, even with conservation, it will still need to obtain 4,100 MW by 2030. As far as I can tell, this figure includes about 1,400 MW of demand growth.

Perhaps an extremely ambitious and successful conservation program could eliminate all projected demand growth. If so, SaskPower would still need 2,700 MW because most of its existing capacity will wear out. Specifically, all natural gas, co-generation and wind facilities as well as a third of hydro capacity and all but one coal plant will need to be refurbished or replaced by 2030.

Refurbishing the co-generation facilities (458 MW), wind farms (172 MW) and dams (297 MW) would provide just over 900 MW. SaskPower has already committed to about 200 MW of new natural-gas generation. The remaining gap would be 1,600 MW, about half of province’s total demand (assuming no growth).

Solar and geothermal may ultimately be able to fill much of this gap at a reasonable cost, but they are currently nowhere near that point. For example, Ontario’s Green Energy Act provides feed-in tariffs of between 45 and 80 cents per kilowatt hour (kwh) for solar generation! By comparison, adding more power from conventional sources costs around 10 cents/kwh.

Large wind farms can also generate electricity for around 10 cents/kwh. Some provinces will build thousands of megawatts of wind power in the coming years.

Although windmills could certainly generate the quantity of electricity that Saskatchewan needs, it would almost certainly not be feasible to provide half of the province’s power from this source. Because wind power is intermittent, it must be backed-up by other types of generation.

SaskPower indicates that turbines cannot operate safely when the temperature falls below 30 degrees Celsius (a regular occurrence during Saskatchewan winters.) Last week, a couple of witnesses questioned this claim before the legislative committee, noting that some windmills generate electricity in Alaska, the Yukon, northern Scandinavia, and Antarctica. This dispute is way beyond my technical knowledge.

Regardless of temperature, the wind only blows some of the time. Placing windmills in different areas can mitigate this problem by tapping into different weather patterns. But as the Pembina Institute noted at last week’s hearings, weather patterns are less geographically diverse in Canada than in Europe.

Also, spreading out windmills undermines the economies of large wind farms. For example, SaskPower estimates that small-scale wind power costs between 12 and 22 cents/kwh.

Certainly, Saskatchewan should expand wind power and invest in developing solar and geothermal power. But it is doubtful that these sources will contribute 1,600 MW in the next two decades.

Hydro

While hydroelectricity is eminently renewable, renewable-power advocates have not emphasized it. In general, they have been willing to endorse only small-scale hydro projects.

Large or small, hydroelectricity is extremely reliable, emits nothing and costs almost nothing, beyond the initial expense of building the dam. The significant up-front construction costs make dams an ideal stimulus project (e.g. the Tennessee Valley Authority during the Great Depression). The historically low interest rates now available to governments make it a good time to undertake such capital investments.

Despite hydroelectricity’s huge advantages, it garners little attention in political debates about future energy sources because most North American utilities have fully exploited available hydroelectric sites. Saskatchewan is exceptional because it only built a few small dams, but balked at larger projects.

In the 1970s, SaskPower proposed the Wintego Dam on the Churchill River. A public inquiry rejected the plan in order to preserve the natural area and traditional ways of life there.

These same issues would again confront large-scale hydroelectric development today. However, the historic decision to not dam the Churchill was made in a context of it being perfectly acceptable to just burn more fossil fuel instead. Today, I suspect that climate change and carbon pricing would far outweigh the original objections to the Wintego Dam.

Such a project would generate hundreds of megawatts. It would also enable a much larger expansion of wind power. Large-scale hydro provides the perfect balance for intermittent wind.

When the wind is blowing, SaskPower could close the hydro turbines and allow water to build up behind the dam. When the wind is not blowing, it could open the turbines to replace the lost electricity.

Small, run-of-the-river hydro projects should also be pursued. However, they would not generate as many megawatts and would not provide reservoir capacity to complement intermittent wind power.

A common suggestion is that Saskatchewan should simply import hydroelectricity from Manitoba. But Manitoba already sells power to the US at premium rates and has no reason to sell to Saskatchewan at cheaper rates.

Also, every megawatt of hydroelectricity redirected from the US to Saskatchewan would presumably cause the US to generate another megawatt from carbon-emitting sources. If Saskatchewan’s goal is to reduce global emissions, it should expand clean hydroelectric capacity rather than divert Manitoba’s.

Of course, every power source has problems and limitations. Every jurisdiction needs strong conservation initiatives and a mix of different generating technologies.

I think that large-scale hydro should be part of Saskatchewan’s electricity mix. At a minimum, the 1970s decision against the Wintego Dam is worth revisiting in light of what is now known about climate change and the coming need to replace most of SaskPower’s generating capacity.

7 comments

  • You make several good points, especially about the infeasibility of nuclear, but you also make a few questionable ones regarding renewables and large scale hydro.

    You say:Because wind power is intermittent, it must be backed-up by other types of generation.
    Later, you mention one way to mitigate that problem:
    When the wind is blowing, SaskPower could close the hydro turbines and allow water to build up behind the dam.
    Good point!
    There are other ways to store power besides reservoirs. Large scale air compressors are being used in the US southwest to store solar power. The compressed air is bled off at night through turbines to produce energy when the sun isn’t shining.

    Speaking of solar, you didn’t give it the attention you gave wind. Solar technology is one of the most rapidly advancing and it is getting more economical every year. Additionally, solar panels mounted on rooftops generate electricity right where it’s needed, reducing transmission costs.

    Here in my southern Ontario area, oyur school board recently signed a partnership agreement with a solar energy outfit to put solar panels on the many flat school roofs in the two counties the board serves. The board expects to save money on it’s own electricity costs and also to cash in on selling energy to the grid. The estimated income is $200,000 – $300,000 per year.

    Solar energy can also be stored in the form of heart. Molten salt technology allows solar energy to power boiling water generators up to 14 hours after sunset.

    You say: spreading out windmills undermines the economies of large wind farms.

    Transmission lines are very expensive. Building industrial wind turbines closer to where the energy is needed may cost more during construction but can save millions on transmission corridors.

    You say: Large or small, hydroelectricity is extremely reliable, emits nothing…

    I am a big proponent of re-utilizing existing dams and millponds that were mainly developed in the early part of the 20th century. Many small communities had hydroelectric generating stations that they gave up when cheap coal power went on the grid. Again, this is distributed energy — produced close to where it is consumed.

    Large scale hydro may not emit CO2 when it is producing energy but there are a couple of caveats. Like any mega project, large dam projects require years of carbon intensive construction and tonnes of carbon intensive concrete production and transportation. Eventually, it can be argued, the CO2 created during construction will be offset by emission free generation.

    The big problem with large scale hydro, however, comes from the way in which it changes the landscape. Large reservoirs flood large areas of land. That land currently has vegetation growing on it. That vegetation consumes CO2. When large areas are flooded, the wild, maintenance-free vegetation that would have kept on sucking CO2 out of the atmosphere forever is killed. Additionally, due to the albedo effect, the vast area of dark coloured water absorbs sunlight and heats the planet quicker than green, relatively lighter-coloured forest or grassland.

    Here in Ontario, the predicted growth in energy consumption was ridiculously off. Even taking the temporary economic downturn into consideration, the province’s energy bureaucracy has has to revise its estimates downward by about 40%. While your SK predictions may be more accurate than ON’s, they may well be just as high.

    JB

  • I wrote a popular piece on this recently. It seems that North Dakota does not have a problem with a major wind power development. Neither does Iowa. From what I was able to find, it seems that the private companies are undertaking these new developments with a promise of only $.075 per kwh. They get some subsidies, of course.

    Another concern of mine is that the most recent new projects for adding supply to Sask Power have all involved contracting out to private corporations. Not only does this cost more, I suspect that the NDP and now Sask Party governments have in the back of their minds privatizing Sask Power, selling it to TansAlta.

    Wind Power Takes Off South of the Border

    by John W. Warnock
    The Leader Post
    July 17, 2009

    In Saskatchewan recent governments have been promoting the development of nuclear power. But just over the border in the United States governments are giving full support to the development of wind power.
    In a recent tour of North Dakota, South Dakota and Iowa, I was struck by the dramatic increase in wind power since I was there four years ago. In Iowa there are now 2,056 wind turbines in place generating 2900 megawatts (MW) of electricity. Saskatchewan has 116 turbines providing Sask Power with 172 MW out of a total capacity of 3200MW.
    In Carroll and Crawford counties in Iowa, where I stayed for a week, MidAmerican Energy added 100 of the popular 1.5 MW GE turbines to their existing 66. This was done within one year at a total cost of around $300 million.
    Iowa farmers are major beneficiaries. They receive an annual royalty of $5,000 for the establishment of a turbine on their land. The contracts are normally for 50 years, with an increase of 2% per year. There is an additional payment of $2000 as an installation fee.
    There are federal and state incentives, which also go to individual and community projects. Farmers put up wind turbines. Communities are using them to power schools. The town of Wall Lake (population 750) has built one turbine and is considering adding a second. Wind power development is encouraged by the installation of a system of net metering, which eliminates the need to provide a storage and backup system. Demand management systems, where energy is priced higher during peak periods, encourages conservation and individual and community energy projects.
    Similar developments are occurring in North Dakota. Currently there are 488 wind turbines in operation, providing 715 MW of power, enough to supply the electricity needs of 205,000 homes. By the end of the year this total will rise to 1,000MW. As the North Dakota Public Service Commission points out, this equals the production from two new coal fired plants, which normally take around a decade to bring on line.
    In North Dakota there are now formal applications being considered by the Commission for constructing 1,412 turbines with a capacity of 5540MW of electricity. In addition, the Hartland Wind Farm project is in the planning stage, to be sited northwest of Minot. This two-stage project would add 1200 turbines. It is waiting until ITC Holdings constructs a new transmission line to take the surplus power to Minnesota and other eastern states.
    The commitment to wind power has brought Iowa eight new manufacturing plants and around 3,200 new jobs. TPI Components established a plant to manufacture turbine blades, creating 700 new jobs. President Barrack Obama recently visited this plant on a green power promotional tour.
    North Dakota’s commitment has also brought new production facilities. LM Glasfiber has a plant in Grand Forks building turbine blades and employs 800 people. DMI Industries in West Fargo manufactures towers for turbines and has opened a branch plant in Ontario.
    Saskatchewan is the best location in Canada for the development of wind power and solar energy. Our potential is much greater than Iowa. It is unfortunate that the NDP governments of Roy Romanow and Lorne Calvert showed very little interest in these industries. This attitude is shared by Brad Wall’s Saskatchewan Party government. We have lost the chance to be a leader in this field, but it is not too late to get on board.
    Why would the people of Saskatchewan choose to develop nuclear power if they knew the alternatives? Ontario asked for bids to build two new reactors at their Darlington plant. The cheapest of the three bids came from Atomic Energy Canada Ltd. at $26 billion. It takes at least ten years to build a nuclear reactor, and they always require enormous subsidies from the taxpayers. Conservation and alternative energies provide much cheaper and more flexible alternatives.

    John W. Warnock is a Regina political economist, author and long time environmental activist.

  • No mention of energy conservation and energy efficiency where Sask. has been behind for a long time. No mention of smart grids that are being developed to better utilize power and allow renewables to function as baseload. What is the Manitoba hydro going to the States to be used for? Perhaps to work with the large increase in wind power that is happening there? Where is the detail on this large projected demand? If we open up too many new potash mines at once, over production will reduce prices. Then the potash companies will being crying for even lower royalties. Will there be a net gain for OUR resource if we have to pay big bucks for their power supply and get less royalties per unit of production?

  • Generally, I agree. One question though, why not contract with Manitoba for additional hydro development as opposed to competing for their existing capacity?

    As for most of North American utilities having exploited their hydro resources, maybe that’s true in the U.S., but not really in Canada, where B.C., Manitoba, Quebec and Newfoundland (and to a lesser extent Saskatchewan and Ontario) all have substantial options left untapped

  • Jim and Mike, you may be correct that SaskPower’s demand forecasts are too high and I am all for conservation. But even if Saskatchewan could reduce demand growth to zero, it would still need to replace existing generating capacity as it wears out over the next couple of decades.

    Jim, you are correct that constructing hydro dams emits carbon and that reservoirs flood land that could otherwise provide a carbon sink. However, building windmills and solar panels also emits carbon and occupies territory.

    John, I share your concern about creeping privatization. It makes sense to allow individuals or co-operatives with small-scale power sources to sell electricity onto the grid. However, I do not see the case for large-scale generation from any source being undertaken through the private sector rather than by SaskPower itself.

    Declan, North American debates about electricity policy often seem to start from the premise that hydro potential has already been fully developed (except the Lower Churchill in Labrador). This premise certainly does not apply to Saskatchewan. You may well be correct that this premise is also false for other jurisdictions.

    I was assuming that Manitoba had fully developed its hydro potential and was selling all it could to the US. However, if there is undeveloped potential in Manitoba that could reasonably be connected to Saskatchewan’s grid, I would not object to SaskPower contracting for it.

  • In Saskpower’s release to the Energy Inquiry they declined, as far as I know, to give any documentation as to where their numbers come from. Further they are saying that about 45% of the demand comes from 35 customers. For confidentiallity reasons they are not allowing us to know who those 35 are. Also, when you look at the information they are offering their conservation and efficiency measures by 2020 represented about 3% of their capacity. Most jurisdictions are looking at 20%. When you look at their demand predictions they are looking at a small increase in the oil patch but a large increase in industrial demand – without saying where that demand will be coming from. Their picture in their power point has a picture of a potash excavator. Personally, I think Saskpower is striving for clean coal and carbon capture and sequestering technologies, which don’t come cheap, and they use about 25 – 35% of the energy produced by a clean coal plant to compress the recovered CO2 into a liquid and pump it under ground. I don’t think this is great economics and I don’t think it is going to reduce our carbon footprint and our net capacity possible will be diminished. If we are goijng to design a grid we have to know where our demand is going and what are our options for reducing that demand to reduce our carabon footprint. Thermal electric plants can not deliver to their customers more than a third of the enrgy they consumed to produce that energy. Conservation can have three times the carbon impact – for every kilowatt you save you don’t burn the equivalent of 3 kw or you don’t have to produce that capacity in some other way. Carbon is what it is about. We have to target the major consumers of our electricity – if they are the potash mines then there is a lot of cogeneration potential there that has to be considered. we have to look at smart grid. Without it we can not run an efficient system of distributed , variable capacity renewables. Smart grid also gives the consumer the tools they need to dfetermine how they can make a difference – in an era of high energy prices a minimum of 15% reduction is not unreasonable. we have to look at shaving and levelling our peak capacity. If we can offset our peak to lower density usage times we can probably probably reduce our capacity by another 10% easy.
    What we really need to do is bring in some independent energy consultants who have extensive enough experince with modern, integrated grids to help us determine how we can make the biggest carbon reduction impact at the most reasonable cost while stimulating a wide spectrum of our local economies. The flooding of land and the subsequent releases of organic mercury and methane into the atmosphere must be carefully considered with hydro. On the other run of the river hydro must also be looked int he context of reducing line losses and possible economic benefits to remote comunitties.
    steve

  • I salute your overview of the topic at hand. I have been following Saskatchewan’s development intensely for about two years now (I am originally from there). My volunteer group and I have been working on topics very closely related to this.

    Firstly, we have an ongoing project regarding Saskatchewan’s Energy Future. This project is slowly growing into looking at the energy future of the prairies.

    Secondly we just finished an article about how we believe SaskPower can introduce a new power buying system to support renewable energy development. Basically what we are proposing is that people can directly financially support those projects that they want to. The proposal is detailed, far too much to go into here. If anyone is interested they can find it prominently on our site, or directly at: http://www.visionofearth.org/featured-articles/publicly-administered-green-energy-futures/

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