Goodale touts power sales to U.S.

Martin Mittelstaedt
Globe and Mail
September 7, 2001

Natural Resources Minister Ralph Goodale says Canada should build new power plants to export huge quantities of electricity to the United States, a bid to make money slaking the enormous U.S. appetite for energy.

“There are tremendous opportunities there as the United States goes through what it self-describes as an energy crisis,” he said.

Only about 8 per cent of Canadian electricity production is exported to the United States, compared with about 50 per cent of the country’s oil and gas, where a continental market already exists.

Mr. Goodale, speaking to a business audience yesterday in Toronto, extolled the benefits for Canada of building power plants for the explicit purpose of meeting U.S. electricity needs.

In 2000, Canada made $4-billion selling electricity to Americans, a small fraction of the country’s $50-billion in energy sales. Mr. Goodale said the country could reap added benefits by boosting electricity sales, including the construction of new hydro megaprojects.

“This could be especially valuable in terms of the hydro-power potential in Newfoundland, Quebec, Manitoba and British Columbia. There are indeed valuable Canadian opportunities to be pursued in more trade, new investment, jobs, skills, economic growth, regional and northern development, aboriginal advancement . . . .”

Until now, Canadian electricity stations have been built to meet local energy needs. Canada has relatively minor transmission connections to the United States, where it sells electricity that is surplus to domestic needs.

Under the new approach expounded by Mr. Goodale, the North American electricity market would become more integrated, allowing utilities to have bigger markets, but exposing Canadian consumers to the higher prices and supply problems that exist in the United States.

This step would also have implications for air pollution levels, and upset environmentalists who object to Canada’s practice of damming northern rivers for their power potential.

Some environmentalists were highly critical of Mr. Goodale’s call for exports, saying it could lead to increased pollution from greenhouse gases and smog, and to huge financial risks from energy megaprojects.

In Canada, for instance, the single biggest air polluter on federal records is the Nanticoke coal-fired power plant owned by Ontario Power Generation. The plant, on the north shore of Lake Erie, generates large emissions that are linked with global warming, smog and acid rain.

Tom Adams, head of Energy Probe, said the government should create surpluses for export through conservation programs rather than through building high-polluting new power plants.

“If Canada was able to realize the conservation savings from all the electricity waste that we’ve got in this country, we’d have at least a doubling of our export potential to the United States without any new facilities,” he said.

 

But Mr. Goodale rejected concerns about increased pollution because new projects would have to conform to Canadian environment laws and demonstrate sustainable development.

Speaking later to the editorial board of The Globe and Mail, Mr. Goodale said the government would soon issue further measures to curtail the country’s emissions of greenhouse gases to comply with the Kyoto protocol, the international pact that calls on Canada to cut its discharges by 6 per cent below 1990 levels.

Canada has already committed to spending $1.1-billion over five years on conservation, energy efficiency and renewable fuels.

New policy directions favoured by Mr. Goodale include those proposed by the Clean Air Renewable Energy Coalition, a group of environmental and energy companies that is calling on the federal government to provide incentives for the production and consumption of so-called green power – energy from low- or no-pollution sources such as wind, biomass or solar cells.

Consumers might receive a rebate for buying cars that run on high amounts of ethanol, or a utility might receive more favourable accounting treatment for investments in wind-power farms.

Mr. Goodale also said Canada is considering an internal system for trading greenhouse gas emissions.

On water safety, Mr. Goodale said he favours national standards for drinking water, but he said such a policy move is complicated because the provinces are responsible for establishing these rules.

 

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