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In Depth

Policy
| 07/06/16

Call for Ottawa to back western provincial electric grid integration

TCE

The federal government must spend billions to fund construction of an integrated western electricity grid to allow hydroelectricity to drive decarbonisation in Alberta and Saskatchewan, a Calgary-based think-tank has argued in a new report.

The two provinces have recently laid out ambitious emissions reduction goals in their respective electricity sectors. Alberta aims to deliver 30 percent of its electricity generation from renewable sources by 2030, while Saskatchewan hopes to see 50 percent of its electricity capacity from renewables by the same date. The non-partisan Canada West Foundation this week issued a policy document critiquing the focus of political discussion in both provinces on wind power as the lowest-cost path to achieving such reductions. The think-tank’s analysis finds that hydroelectricity imports from neighbouring British Columbia (BC) and Manitoba is in fact the least expensive option, and also the fastest way to deliver GHG emissions reductions.

Although hydro has substantial up-front construction costs, hydro plants have the longest lifespan and lowest operating costs of all electricity generation choices, clean or dirty, the paper adds. In addition, while wind is intermittent and dependent on optimum weather conditions, hydro like fossil fuels is able to provide reliable baseload, or ‘always on’, electricity.

Both BC and Manitoba have major hydro projects in development. Importing from these admittedly controversial projects to Alberta and Saskatchewan would bring substantial clean electricity online much faster than developing internal capacity, the paper argues, and cheaper than developing new internal clean electricity capacity.

The problem is that the western provinces, and indeed the country as a whole, do not have a truly integrated electricity grid. The think-tank argues that as the lowest-hanging fruit enabling Canada to achieve its international climate pledges is cleaning up the coal and gas dependent electricity systems of Alberta, Saskatchewan and Nova Scotia. As a result, the paper’s main conclusion is that the western provinces must get behind a push for such integration and that the federal government must pay for the build-out of interprovincial transmission lines in the west to facilitate increased trade in renewable electricity. The sums envisaged would be substantial, as the cost of connecting the highly controversial Site C dam in BC to Alberta’s grid is estimated to be $2 billion. However, the federal government has announced billions in fresh stimulus spending targeting the clean transition, although much of the detail has yet to be rolled out.

The paper notes that beyond funding, the primary challenge facing grid integration is gaining public support for such long, linear infrastructure projects. Expanding transmission infrastructure from Quebec to New Hampshire has faced opposition from local environmental groups due to the impact on the landscape. Site C also has its environmental critics, and former New Democrat chief Adrian Dix in the past week has argued that new transmission lines and selling hydroelectricity to Alberta from Site C is uneconomical because the export price for electricity is half what is charged within BC. He argues that as a result, such sales would mean that the province loses out on $250 million a year in foregone revenues.

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Western provinces must get behind a push for grid integration and the feds must pay

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