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Announcement brings some clarity to expected regulations

Federal environment minister visits clean coal construction site
Federal Environment Minister Peter Kent

It may not have been the announcement that the media and provincial officials were hoping for, but federal Environment Minister Peter Kent's statements last Friday afternoon at least provided a bit of clarity as to what can be expected ... soon.

Kent was in Estevan at the Boundary Dam Power Station, the home of the world's first commercial-sized carbon capture pilot project, to announce that a draft of proposed regulations to govern coal-fired power plants in the future, will be published this coming weekend (Aug. 27) and that will be followed by a 60-day public consultation period. After that, the regulations, perhaps with some tweaking, will be in effect.

So while media and administrators didn't get the actual announcement, what they received was the next best thing, plus a few strong hints that the new regulatory regime won't be too stringent.

Later during a media scrum, Kent noted that such items as cap and trade, cap and tax or cap and invest regulations that might have governed greenhouse gas emissions in the future, are "off the board and have been off the board for about a year now."

What is expected now will be regulations that will place coal-fired power stations in a situation where their greenhouse gas emissions will only need to match those pumped out by natural gas fired units.

With SaskPower building a carbon capture (clean coal) retrofit on Unit No. 3 at Boundary Dam that will eliminate as much as 90 per cent of the noxious gases from the environment, the local project will meet that anticipated regulatory level quite easily, say SaskPower management and officials.

Kent, speaking to a gathering of about 60 people on the lawn in front of the power station, said there will be a gradual phase-out of traditional coal-fired generating plants with July 2015 being the benchmark date for the start of compliance with the new rules. He noted during the media scrum that Canada currently has 50 coal-fired plants that are nearing the end-of-life scenario (40 to 45 years) with 19 of them actually there by 2015. Without refitting them with life-extending clean coal capabilities, they will have to be phased out. Boundary Dam's Unit 3 will now be spared that situation since the aging structure is being rebuilt with a new turbine and carbon capture technology that will boost its life span for another few decades.

Decisions on Boundary Dam Units 4, 5 and 6 will be made shortly after the Unit 3 project has been assessed. Since existing plants will be given a generous "grandfather" clause and time limit for compliance (approximately another 10 years after 2015) the prospects of continuing to provide electrical power in Saskatchewan using coal as the main fuel, appear very good.

"Our strategy to lower emissions is based on making improvements sector-by-sector," said Kent, noting that this is in compliance with the Copenhagen Accord that allows plenty of room for consultation which he said "is the best way to go forward with environmental planning to meet 2020 targets."

Kent said he felt the announcements slated for this weekend will "help Canadians breathe easier" and they will be working in concert with their American counterparts as the sector-by-sector regulatory standards roll out into transportation, steel industries, et al, in an orderly process."

Kent called Saskatchewan a clear leader on the clean coal/environmental protection file having shown additional leadership by committing over $1 billion to the BD3 project. He noted that by the time the regulations kick in, the additional cost to electrical consumers will probably be about $5 per year.

Earlier in the conference, SaskPower president and CEO Robert Watson said that placing a value and conducting sales of carbon dioxide as an enhanced oil recovery tool, will add value and reduce costs associated with the carbon capture project.

Kent later said the roll out of environmental regulations will not only be sector-by-sector but will probably come through region-by-region as well with various transition phases "without stranding capital," while eventually eliminating 31 megatons of noxious gases within the next decade.

When asked by the media if he felt Alberta was playing fair by racing forward with approvals for their Maxim coal-fired electrical plant to get it operational before July 2015 and therefore dodging the expected 2015 regulations, leaving them in the grandfathered group of power plants, Kent said he would "not comment on corporate citizenship" questions and wasn't going to be dragged into questions of whether Alberta was violating the spirit of the regulations. He said they would not be moving the regulatory dates up or back.

During the media scrum, Watson said that working with a conservative model and pace established with the Unit 3 project, the economic model for retrofitting Units 4 through 6 at Boundary Dam will be rolled out in stages.

Dustin Duncan, Saskatchewan's minister of the environment, said the proposed regulations pretty well "assured the use of coal to fuel provincial power plants in the future."

Kent said the government of Canada's target is to reduce the country's greenhouse gas emissions 17 per cent from 2005 levels by 2020 throught the sector-by-sector system and in alignment with the United States.

During his opening address, Watson, who served as emcee for the event, issued thanks to Boundary Dam plant manager Mike Zeleny and his employees for protecting SaskPower's interests and providing continued efficient services in spite of the additional demands being placed on the plant due to the $1.24 billion clean coal plant construction process that is now well underway.

"This is a first in the world carbon capture facility," he said, which drew a hearty round of applause from the audience, then he added, "It's a scary thing, actually," which then drew a hearty round of laughter.

Watson called on Souris-Moose Mountain MP Ed Komarnicki to introduce Kent, a former CBC television news anchorman, who is now the MP for the Toronto area riding of Thornhill.

Duncan said that the provincial carbon footprint will drop dramatically with the start-up of the BD3 carbon capture unit in early 2015 and the decommissioning of BD Units 1 and 2 shortly after. These two generators, the first to enter into service at Boundary Dam in the early 1960s, are now considered too small to qualify for a major clean coal refurbishing.

The afternoon events included a quick tour of the clean coal construction site by Kent and other officials and a barbecue on the Boundary Dam lawn that was enjoyed by visiting dignitaries as well as SaskPower employees who were on their lunch break.

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