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Alberta Needs an Energy Plan

Posted by mhudema on July 24, 2008

Albertans deserve a viable energy plan for the future
Nigel Hannaford
Calgary Herald

Say what you like about oilman T. Boone Pickens, and his campaign to cut U.S. oil imports by generating electricity with windmills, and using the natural gas this would free up for transportation fuel: At least, he has a plan.

The question is, does Alberta have an energy plan?

City-owned utility Enmax recently suggested it certainly ought to, and called for the province to look at energy over the 50-year haul.

CEO Gary Holden’s pitch was received politely in government, but a little icily.

For one thing, Holden was effectively inviting the province to reopen a matter it thought it had settled four years ago, namely the regimen of electrical generation and distribution in Alberta.

Second, Alberta Energy has already been told to prepare an energy plan for the province — an overview that goes much beyond Enmax’s focus on electricity — and is supposed to send the first cut to Energy Minister Mel Knight this fall. ‘Scuse us, we’re already on the case.

Still, even if one thinks there may be elements of self-interest in Enmax’s clarion call, there’s still nothing fundamentally wrong with Holden’s question. Indeed, one wonders how many Albertans’ first reaction was, “You mean, we don’t already have a plan?”

At the risk of oversimplifying some formidable complexities, Holden suggested in May that Alberta’s Transmission Regulation should be amended so power-network planners would not be excluded from considering non-grid solutions to meet future power needs.

In other words, if it makes more sense to put a power station near a city than string cables to it from a generator somewhere else, why wouldn’t you do that, and save the huge cost of cables? The answer, according to Holden, is that the Regulation says you have to expand the grid’s carrying capacity, so that any electrical generator can compete for the growing business. But, of course, the consumer could end up paying for lines that didn’t have to be built.

So, you want power in Calgary? Build your power plant near Calgary, not 400 kilometres away. Then, perhaps one wouldn’t have to upgrade that controversial Edmonton to Calgary power line, at vast expense. Or at least, not yet.

But, as an Energy ministry spokesman pointed out however, if taken to its seductive conclusion, such regional generation could stifle competition. Various suppliers might end up “owning” markets, if the capacity of the lines linking them were not expanded with the economy.

Albertans wouldn’t accept a country road between Edmonton and Calgary, and the case for an electricity interstate is comparable. And, regardless of the market, what happens if there’s a need to move power around the province to cope with an emergency?

All this was followed by Holden’s second suggestion, that the Alberta government should take a hard look at how the province will respond over 50 years to what looks increasingly like fundamental shifts in the economics of energy. In the next few years, Alberta must make energy decisions that will establish its direction for decades: Let’s talk about it.

That, at least, should be an easier sell. To listen to Holden one day and Alberta Energy another, is to become persuaded of the need for exactly the kind of public discussion he is asking for.

What the minister is to receive in the fall is the distilled wisdom of the ministry, and the people the ministry talks to. No doubt, it will be solid.

However, it would be surprising if it gave much room to iconoclasts such as Holden. (Or such as Pickens, were there an Alberta clone of him.)

The truth is many Albertans might also have an opinion on questions, such as how the rising costs of oil will impact other types of energy.

How will it affect where people choose to live, what kind of houses they occupy and how they travel? Shall we continue to develop suburbs based on automobile use, or foster high-density downtown living?

What about the price of the natural gas Albertans use to generate peak electricity and heat their homes, now that it is increasingly set by world markets? What does it mean for oilsands producers, who make heavy use of it in their process?

Will the present model of large central power generators connected by overland wires become an anachronism, in the kind of small-is-beautiful world the green lobby has advocated for years? Is that world even feasible? Should Alberta export electricity to the U.S., in which case more lines will certainly be needed?

Coal? Nuclear?

A plan should consider all this, as well as the environmental considerations the government has stipulated.

Sure, planning’s limits are evident: One only has to consider how much use we would still make of a plan written in 1958. One must also accept that for better or worse, somebody has to make a decision and everybody make the best of it.

Still, what we build today we will use for decades. We trust the government intends to open its draft to public review before going to final printing.

If Alberta is to get the energy strategy it needs, the government shouldn’t be afraid to seek the widest counsel in these chaotic times.

nhannaford@theherald.canwest.com

© The Calgary Herald 2008
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