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Five takeaways from Premier Moe’s announcement on power plans

Moe outlines SaskPower is committed to net zero in 2050; won’t go along with 2035 target which he says will be unaffordable and impossible to meet.

REGINA - Premier Scott Moe has revealed Saskatchewan’s electricity generation plans for 2035 and the future, and they stand in contrast to the clean-electricity vision of the federal government.

Officials at the province's news conference on Tuesday, which also included SaskPower CEO Rupen Pandya, Minister for SaskPower Don Morgan and Minister of Justice and Attorney General Bronwyn Eyre, painted a grim picture about what it would take to meet a federally-mandated 2035 target under their coming Clean Electricity Regulations. According to the province, rates would more than double, and the Premier raised the prospect there would not be enough power for the province with the shutdown of coal and natural gas.

"Folks, now you can see the impossible position that our province of Saskatchewan, and SaskPower have been put in as the federal government continues to move ahead with policies that quite simply are not based in reality,” Moe said. "We’re coming to a crossroads and at stake is affordable and reliable power across the province.”

Here are five things to know about the announcement from the province on electricity generation targets.

The issue: aggressive federal clean electricity targets by 2035

The province was responding Tuesday to the federal government’s clean electricity regulations with an aggressive target of 2035 to achieve net zero. 

But the province and SaskPower had already signalled that this is unachievable. SaskPower had previously been committed to a target of achieving net zero by 2050. 

At the news conference Tuesday, Pandya made it clear that SaskPower achieving net zero by 2035 is “not possible” due to technological and logistical challenges.

“Unlike provinces rich in hydro power like Manitoba, British Columbia or Quebec, we don’t have the geographic benefit of being able to develop zero-GHG (greenhouse gas) emitting large scale baseload hydro production,” said Pandya.

In their presentation, SaskPower pointed to low customer density and their significant reliance on fossil fuel generation sources. With a current capacity of 5,437 megawatts, SaskPower sources 65 per cent from thermal fossil fuel emitting generation. 

The percentages are 40 per cent natural gas from ten facilities and 25 per cent coal through three facilities, with 16 per cent hydro, 11 per cent wind, five per cent through power agreements and three percent solar. To meet a growing population of an estimated 1.5 million people, the province estimates it would need 7,000-plus megawatts of available generating capacity by 2035.

Grim outlook painted for future under Fed regulations

Premier Moe told reporters that they expected the federal clean electricity regulations to be “so severe that Saskatchewan Power would not be able to operate any coal or natural gas power plant, even with the CCS (carbon capture and storage) technology that we currently have employed today.”

“That means we would be faced with shutting down our Boundary Dam 3 facility. It means we would have to consider shutting down our natural gas plants including the ones that we have just opened and the ones we have not even yet opened. And that begs the question to our province and to SaskPower is where are we going to get our baseload electricity from. Wind and solar can supplement power production but they can’t provide baseload generation.” 

According to SaskPower, under the federal clean electricity plan 65 per cent of Saskatchewan’s current electricity production — the portion relying on fossil fuels — would need to shut down, with $46 billion in capital costs by 2035 and a 107 per cent increase to utility bills. 

“Natural gas generation will be required beyond 2034 and without access to natural gas generation to back up wind and solar to meet customer electricity demand, SaskPower will be unable to meet Saskatchewan’s electricity needs in 2035,” said Pandya.

Pandya also said importing more hydro from Manitoba would not be possible, saying there was maybe 100 or 200 mw of capacity they could access. But that won’t be sufficient. 

“Manitoba does not have surplus power to meet Saskatchewan’s need to meet net zero by 2035.”

The province’s position: achieve net zero by original 2050 target

At the news conference Tuesday, the province outlined its “affordable and realistic” path forward, through sticking with their original goal of meeting net zero by 2050.

Premier Moe said they will continue to invest to replace generation that has come to the end of its life, and to grow electricity production to keep pace with their economic and population growth. He also said the investment would also help further reduce emissions through adding more renewable power, more technologies such as small modular reactors and a safe and reliable and affordable power system for Saskatchewan people.

According to the province, this will mean continued emissions reduction by incorporating nuclear power as part of the mix, continuing to incorporate wind and solar at an ambitious pace, and leveraging natural gas to ensure reliability. 

“And so today, we are asking the federal government to support Saskatchewan’s plan,” Moe said. 

Province seeking federal financial support

Moe asked that the federal government recognize the province’s plan to achieve net zero by 2050, and to contribute to the cost of emissions reduction by providing 75 per cent in funding for the first small modular reaction in Saskatchewan, and 50 percent funding for renewable technologies or low emitting power. 

Under the province’s plan the total cost of $28 billion, with $22 billion from Saskatchewan and $6 billion coming from the Feds.

“With that federal contribution the Saskatchewan plan can hold annual rate increases to about three per cent, which is in stark contrast I would say to the unaffordable plan by the federal government which results in a total rate increase of 107 per cent by 2035.”

Additionally, to achieve affordability the province wants to see a stop to any further increases of the carbon tax, and consider running their fossil fuel facilities until the end of life.

Moe characterized the federal plan as “unaffordable,” jeopardizes the reliability of their power system, and imposes unrealistic timelines and damages Saskatchewan’s economy with power rates expected to more than double. By contrast, he said, Saskatchewan’s plan will keep rates affordable, keep reducing emissions to net zero by 2050 and continue to grow Saskatchewan’s economy.

Premier Moe repeated similar talking points to those made recently in his address to oil producers at the Williston Basin Petroleum Conference in Regina, when he made clear the province would not attempt the impossible in meeting the targets.

“In Saskatchewan we will not attempt the impossible when it comes to power production in our province,” Moe said. “We will not risk plunging our homes, our schools, our hospitals, our special care homes, our businesses into the cold and darkness because of the ideological whims of others. We will not increase power costs for our businesses and our families to the point where they become completely unaffordable…

“Saskatchewan must have affordable and reliable electricity on demand and under our watch it most certainly is going to. We are choosing a Saskatchewan plan and I would say the federal government has a choice as well. Let’s hope they make the right one.”

NDP response

The opposition New Democrats issued their response to the announcement soon afterwards, with their SaskPower Critic Aleana Young accusing the Sask. Party government of being “completely missing in action when it comes to expanding renewables at SaskPower.”

In speaking to reporters, Young said "when it comes to where we need to be as a province, this is one of the most important files that we have. It impacts everything from cost of living to business development. You know, as important as this file is, again I didn't see very many details. I saw a lot of 'province mad at federal government', and I think what people want on this file is government that is going to act like the adults in the room, get some accountability and some transparency when it comes to what we're actually talking about, and ensure that people in Saskatchewan have affordable, reliable and sustainable power."

As for what the province could be doing differently: "There's a lot a little things. We could be doing things like working with some of our large industrial customers to look at things like self generation, to look at things with households." 

She also pointed to the "lack of urgency over the last 16 years" and said because of that inaction it meant the 2035 target was unachievable right now.

"That doesn't mean we shouldn't try to ensure that we're reducing our emissions and ensuring we have affordable power for people in Saskatchewan. 2035 can we hit it with where the government's put us now? Probably not."

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