If there is one thing that unites the many different communities and corporations in Saskatchewan it's the problem of aging infrastructure. SaskPower has to confront the problem head-on in the coming years, and Mike Marsh, VP of Operations and COO of SaskPower spoke at a recent Chamber of Commerce luncheon about the challenges faced by the crown corporation in the coming years.
The problem is in part that power consumption is steadily increasing, but the corporation needs the supply to continue to reach the different customers, new and old. Marsh says that there was a 14 per cent increase in the number of customer hookups in 2012, with 2013 numbers set to match that trend, and the record peaks have increased by 200 megawatts as well. There are also two peaks each year, as air conditioner usage becomes more ubiquitous it drives an increased summer peak. The rate of power consumption is expected to increase by 30 per cent in the next 20 years.
"Bottom line is, we're seeing a need for more power, more often, and in many cases by more people," Marsh says.
The issue is supplying that power, something that becomes a challenge as older power generation units are taken off-line. Marsh explains that they need to be taken off line due to their age and their inability to meet modern environmental standards. Most of the retired facilities will be coal-fire plants, and Marsh says they cannot be replaced by the same kind of plants. Marsh says that environmental responsibility is a priority, and he notes that they are looking at more sustainable options for generation.
"Coal as we know today is finished, it's over... We cannot get a license to build or operate a coal fire station... We have to find new ways to generate power in this province."
Renewable energy research is a priority for the company, Marsh says, and geothermal is one of the options currently being explored to create power for the province. He says that the ecological footprint is small, but it is expensive technology.
Beyond generation, aging infrastructure is a problem in terms of distribution as well. It is the cause of 40 per cent of the unplanned outages currently experienced, Marsh reveals. The average age of the 1.25 million power poles in the province is 38 years, for example, but a quarter of them are from the 1950s and beyond the expected life expectancy, which is 50 years.
"It's going to take us 20 years just to get caught up, and get the poles from the 1950s taken care of," Marsh says.
The challenge right now is meeting the problems of the infrastructure. Marsh says it will not be cheap, and it requires some long term planning to ensure that the process is not painful for consumers. He does caution that it will be an expensive process as SaskPower tries to bring itself up to date.
"We need to invest about a billion dollars a year in capital in order to get this job done," Marsh says.
He says that rate increases are inevitable, and says that without them the crown corporation will see losses and customers would see larger increases in the future. Marsh says that costs are otherwise competitive with similar utilities in other provinces.
