On March 4, 2014, the Standing Senate Committee on Energy, the Environment and Natural Resources initiated a study of energy use and supply in Canada’s territories.
The report examined existing territorial energy systems and identified obstacles and opportunities facing each territory in making energy affordable, reliable and sustainable for its residents and businesses. A focus was placed on electricity systems.
As a whole, the committee found electricity systems aging, underperforming and at capacity. Also, the committee observed that territorial communities were highly dependent on diesel generation. The committee also found a lack of financial capacity among utilities and territorial governments to advance major projects due to small rate and tax bases. Utilities face high costs associated with servicing many small remote communities which predominantly rely on diesel generation. Also, energy options are constrained as the territories are not connected to the North American electricity and natural gas grids.
Many energy issues are shared pan-territorially; however, each territory faces distinctive challenges and opportunities due to dissimilar geography and degree of community remoteness. Also, territories have different energy resources and asset profiles. Electricity prices in the Northwest Territories (NWT), and in particular Nunavut, are high compared to the rest of Canada, which increases the cost of living and requires subsidization to keep energy affordable. Nunavut’s unique and sizable energy challenges stood apart from its territorial counterparts.
In all three territories, heating of homes and buildings is predominantly provided by furnace oil (diesel), which is reliable but costly and carbon-intensive. While substantial petroleum deposits are estimated in the territories, much of these resources are undeveloped and underexplored.
All three territories have developed energy strategies that differ in scope and implementation, to promote and support renewable energy, increase energy efficiency, and reduce the dependency on carbon-intensive fuels. In Yukon and NWT, new opportunities for natural gas generation and biomass heating are helping to diversify the territorial energy mix.
The report makes five recommendations to the federal government to help improve the energy circumstances of the territories. The recommendations are aimed at improving energy efficiency and conservation, enhancing community-based energy solutions and coordinating federal resources under a central hub. The committee also recommends that the federal government assist with upgrading and improving aging diesel generation facilities and infrastructure investment in qualified territorial energy projects.
That the federal government develop a strategic plan to actively improve energy efficiency and conservation in the territories.
That the federal government significantly increase funding to the ecoENERGY for Aboriginal and Northern Communities Program with the objective of reducing the consumption of carbon-intensive fuels, increasing energy efficiency and enhancing community economic viability.
That the federal government create a federal resource and knowledge hub to focus on territorial energy issues and conditions, in supporting energy supply and technology evaluations, economic and environmental modelling and energy resource planning and assessments.
That the federal government assist in the acquisition, upgrading and installation of diesel generating facilities in remote off-grid northern communities.
That the federal government support infrastructure investment in qualified territorial energy projects.
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