Energy becomes big issue in Atlantic Canada

HALIFAX — Competing visions of how to wean Atlantic Canada from fossil fuels and hook it into a greener hydroelectric grid have caused premiers to clash and old hopes of regional unity to falter.

HALIFAX — Competing visions of how to wean Atlantic Canada from fossil fuels and hook it into a greener hydroelectric grid have caused premiers to clash and old hopes of regional unity to falter.

Debate over the region’s energy future broke wide open on Oct. 30 when New Brunswick Premier Shawn Graham announced his proposed $4.8-billion deal to sell his province’s utility to Hydro-Quebec.

It’s a deal prompted partly by a desire to find alternatives to oil and coal, Graham said in a recent interview.

“We had to seize our own future,” he said of the plans to sell NB Power and tie his province more closely to Quebec.

“This is a game-changing moment for the province of New Brunswick … because it allows us to access cheaper hydroelectricity, weaning off our dependency on expensive oil and coal fossil-fuel generation.”

Whether the proposed deal with the Crown-owned Quebec giant will meet those goals will be a topic of debate in 2010 as the Liberals face fierce local opposition from labour groups and the provincial Conservatives.

However, some energy experts and economists say Graham’s deal signals politicians in oil-importing provinces are willing to make bold and risky moves.

“Energy changes a lot of old assumptions,” says Jeff Rubin, author of “Why Your World is About to Get a Whole Lot Smaller.”

The former chief economist with the Royal Bank of Canada says that the recession was caused by soaring global oil prices in 2008, and he predicts high energy prices in the near future.

“Should we be hitching our wagon to hydroelectricity? Well, yeah,” he said from Toronto.

Larry Hughes, an engineering professor at Dalhousie University in Halifax, has been issuing warnings for two decades about the region’s overreliance on imported hydrocarbons.

Hughes, the director of the energy research group in the department of electrical engineering, has published scientific papers estimating that 60 per cent of the region’s total energy comes from oil sourced in Norway, Iraq and Saudi Arabia.

“Do we have an energy security problem in the next 12 months? Probably not. In five years, more than likely. Within a decade, most definitely. By 2019 there will be supply problems,” he said.

Graham said he believes his deal with Hydro-Quebec will guarantee a long-term supply of renewable energy. And he noted that offshore oil available off Newfoundland and Labrador, and natural gas from Sable Island off Nova Scotia have been “blessings” that his province doesn’t possess.

He predicts other provinces in the region may soon see the wisdom of his deal.

“Prince Edward Island has recognized the benefits of sourcing cheaper hydroelectricity from Quebec and I’m sure through time Nova Scotia will also recognize the importance of lessening their dependence on expensive fossil fuels that are damaging their environment,” he said.

Premier Danny Williams of Newfoundland and Labrador is pitching an alternative vision based on the creation of hydro dams in northern Labrador.

The $6.5-billion projects at Gull Island and Muskrat Falls theoretically have enough capacity to supply the energy needs of 1.5 million homes, but their development depends on selling the electricity in New England at a premium price.

Williams says he has little faith in Quebec’s willingness to allow his province to export electricity from the Lower Churchill through Hydro-Quebec’s transmission lines. He has also become a vocal opponent of Graham’s scheme, saying he fears Hydro-Quebec would limit the transmission of the Labrador power through the Maritimes.

Atlantic Canada should have worked together, he said.

“We were at the table negotiating a full partnership with Atlantic Canada. It’s a win-win situation where we’d have ownership of the generation facilities, while Emera (Nova Scotia’s privately owned utility) and New Brunswick would have the energy hub and the transmission grid,” said Williams in an interview.

“There would have been a partnership among us.”

Williams has threatened a court challenge to try to block the New Brunswick deal, arguing Hydro-Quebec is engaged in anti-competitive activity.

Meanwhile, in Nova Scotia, the province envisions a future where tidal, wind and other renewable energy sources contribute 25 per cent of its electricity by 2020.

Proponents have argued the viability of those projects also hinges on being able to export the green energy to New England.

In an interview, Premier Darrell Dexter said he believes that can still happen if the Hydro-Quebec deal goes through — but he’ll have to do some deal-making.

One possibility would be to make an arrangement with New Brunswick’s government to allow Emera, owner of Nova Scotia Power, to build and operate a transmission line from Amherst, N.S., through to the Maine border.

“I think there are opportunities for us to increase and look at the transmission lines that are already running through (New Brunswick) … and look at whether now isn’t the time to strengthen those existing corridors,” he said.

However, it’s unclear if New Brunswick or Hydro-Quebec are interested in such a project.

As the premiers joust over hydroelectricity, observers like Hughes say the region needs to stop thinking about export schemes and instead consider ways to generate renewable power and use it locally.

For instance, Hughes envisions a future where virtually all of the renewable electricity produced by the wind and tidal projects in Nova Scotia stays in the province. Even Newfoundland might consider keeping its massive hydro resources in the province within a decade, he said.

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