First published Telegraph Journal October 21, 2006
When looking at an energy problem, the most evident solution is not necessarily the best. For example, one of the problems that we have is the high cost of power plant construction. Typically, they have been costing close to $1 billion and that means an annual payment of $100 million. This will translate into a 10% rate increase for all of us including the industrial customers who object to high power rates these days. One would think that they would object to a new power plant if it could be avoided.
But we have built departmental empires that don’t communicate well or understand the whole picture. NB Power’s solution to a generation deficit is understandable and automatic – build a power plant. The PUB is there as a watchdog on NB Power and gets caught up in the game – what to build and when? The Energy department may have some ideas but what is their influence? And Efficiency NB – what is the story on their programs? How far does their mandate go?
New Brunswick has a power demand of 1600 MW in the summer and roughly 3200 MW in the winter. We have to build enough power plants for the highest figure. But what would happen if we could stop or even decrease our demand peak? This would mean that we wouldn’t require another power plant and wouldn’t require a $100 million rate increase. Or if we did decide to build a power plant, it would be to reduce greenhouse gases. (Wind turbines or hydro)
Lets assume that our annual growth is 1% per year or 32 megawatts. And perhaps we can assume that a power plant would be needed in the next 5 to 7 years to meet growth. Therefore, we would have to reduce the demand by 32,000 kW each year to defer this project. Assuming that 60% of homes are electrically heated, then that is roughly 132,000 homes in the provinces. 1600 MW / 132,000 provides an average heating contribution to peak is 12 kW. This is probably high as commercial and industrial space heating is included and perhaps a figure of 8 kW / per home is more likely.
The Liberal energy conservation program for homes at $60 million per year will affect roughly 30,000 homes. Of these 18,000 are electrically heated and will reduce peak demand by perhaps 1 kW for $2000 per home. If this program is effective, then we reduce growth down to 1/2 %.
Then, imagine a program to encourage people to convert from electric to another fuel, preferably wood. If the program cost was $2000 per customer, then we would only have to convince 1750 people for a total cost of $3.5 million to reduce growth to zero. (14,000 kW / 8 kW *$2000) The cost per kW of this program is $250 per kW versus $2000 for the conservation program. Both are valuable programs, but it can be seen that the off electric version is more cost effective.
One thing that tourists coming to New Brunswick note is the amount of forests here. Many people here heat with wood already and save money doing it. While there are many systems out there today, I want to talk about the pellet stove as it overcomes the basic problems with the standard wood stove.
Pellet wood stoves are growing in popularity for several reasons and particularly in the United States due to government support to reduce oil dependence. One of the major strength of these units is that they can provide an even heat for 24 hours or more by the use of its automatic feeding system. The pellets are made of waste wood, compressed into small pellets and packaged in 40-pound bags. According to George Jenkins, a researcher at the UNB Wood Science and Technology center, there is room for a large expansion of the pellet fuel market as there is considerable waste left in the woods. Perhaps 30% is left to rot on the forest floor, as some trees are crooked or partially rotten and have little commercial value. In addition, the emissions of these units are very good when compared to standard wood stoves, as the air intake is not restricted.
Burning wood is considered a carbon neutral activity as the rotting of wood is equivalent to the burning of wood from a CO2 point of view. However, when waste wood displaces carbon-based fuel such as natural gas or oil fuel, it actually reduces the CO2 load on the environment. As well, the expenditures on wood as a fuel stay within Canada and support our balance of payments.
Will we choose the standard answer for $100 million per year or the alternative at less than $10 million per year? Will the upcoming PUB hearings on load forecast be more of the same high-priced consultant feeding frenzy considering the minute mathematical details without understanding the greater options that are available to us? Will a real approach to demand control even be considered? Is the Liberal government ready to take control and organize the energy file? The previous government was considering a new coal plant. Will it be business as usual with politics trumping common sense? Only time will tell.