The topic of powering the province of Saskatchewan was front and centre Monday at the Rotary Club's noon luncheon.
Robert Watson, CEO of SaskPower, was there to provide Rotary members with an overview of activities at the provincial utility, as well as some of the pressing issues the company faces in providing electricity to the province.
The main issue, he said, are infrastructure concerns. The grid is aging, and significant investment is being made in that infrastructure.
The need for power continues to go up. Watson noted power demand grew by six per cent last year, the highest in North America.
The result is SaskPower will have to find a way to generate even more power in the future.
"We will have a significant gap till 2033," said Watson. Approximately 1300 MW will be needed by then, he said.
One way to meet the need is building more gas plants. Watson described one likely in the Swift Current area and another west of Saskatoon.
Another issue that will need to be addressed is the reliability of the grid, which SaskPower is not happy with right now, Watson noted.
Addressing it will not happen overnight. Even if they replaced 100,000 poles for 10 years, it wouldn't happen for 10 years. "Even if we doubled your rates," said Watson, it would "not happen in the short term to help you out."
SaskPower is trying to keep rate increases reasonable, in the middle-single-digits, said Watson, to allow people to plan . An average 5.5 per cent increase is coming annually over the next three years.
As for what will feed the grid in coming years, Watson does point to more wind power as a possibility. He says the economics of bringing wind to the grid are "quite good" so that probably could be added over the next 10 to 15 years.
The cost of gas remains low right now but Watson notes "the cost of gas is going up. So we have to be cautious about gas."
There is also the possibility of hydro in the far north, but those projects would be pursued only "on an economic basis. We don't do subsidies," said Watson.
Coal also remains part of the mix, and some big changes are coming in that regard in the southern part of the province at Boundary Dam Unit 3.
Watson described the big Boundary Dam Carbon Capture Project at that facility as having "the world's first full-production carbon capture facility for a coal-burning power plant."
"When that's into production we will capture 90 per cent of CO2 emissions," said Watson, "100 per cent of SO2 and 50 per cent of the NOX."
It will be the first of its kind in the world, Watson said. "With coal so plentiful down in the southern part of the province and so readily available, it's something that we felt we had to look at in the business model."
The plan is to get it into operation this summer and test it out over the next two years, to test the technology and the costs. In 2016 SaskPower will be able to recommend to the government whether they do more or not, Watson said.
Tougher federal environmental regulations are also on the way in July 2015 that SaskPower intends to meet.
By the time they are finished with Boundary Dam 3, he said, "it will get down to 150 tonnes per gigawatt power, it will be better than any gas plant, any fossil fuel plant ever. So it will be well within the regulations."
Another thing people can expect is more private-power purchase agreements, such as the one SaskPower made with Northland Power for power from the North Battleford Generating Station.
However, Watson emphasized SaskPower will "always compare a power-purchase agreement with us doing it (the financing) ourselves."
What does not seem likely for the foreseeable future, Watson made clear, is nuclear power.
Some Rotary members were interested in that issue in the wake of the possibility of Bruce Power building a nuclear power facility in the Northwest a few years ago, a project that ultimately did not go ahead.
Watson noted that reactor would have been "too big for the province" and the whole transmission grid would have needed to be upgraded to accommodate it.
However, a smaller reactor might be something SaskPower could consider, Watson acknowledged. "They're developing small-modular reactors, SMRs, and we're keeping a watching eye on those," said Watson.
Those would be the perfect size for Saskatchewan, he said. But Watson also made clear that "we're not going to be the first at it."
