February 20, 2002
Uniterre Resources Ltd., a small Vancouver energy company, signed on to a joint venture yesterday to develop what would be one of the world’s biggest wind power generating projects, in northern British Columbia.
But a leading power industry expert said the project will never see the light of day unless Ottawa is prepared to dish out millions in subsidies.
The wind farm, as envisaged by Uniterre and its partner, Swiss-German industrial giant ABB Ltd., would generate up to 700 megawatts (MW) of electricity, enough for a city of 700,000. Wind in the proposed area, off the coast of the Queen Charlotte Islands, averages about 31 kilometres an hour.
Power generated would be transported via an underground cable to B.C. Hydro’s transmission grid in Prince Rupert.
The cost of this project is somewhere in the $1-billion range, Uniterre says.
The two companies will conduct a feasibility study to see if the project is economically viable. A decision to proceed is expected in mid-2003, and should they agree to go ahead, construction would start the following year.
“We wouldn’t start down this path if we didn’t think it was profitable,” said Jack Austin, Uniterre chairman and a Senator who represents British Columbia.
Not everyone agrees. “Unless this project draws in great amounts of government subsidies, it’s going to blow over,” said Tom Adams, executive director of Energy Probe, a power industry watchdog.
Mr. Adams said wind power is expensive – the cheapest estimate from alternative energy advocates is 8¢ a kilowatt hour (KwH), a substantial jump compared with Ontario, where consumers pay about 4.3¢ per KwH for electricity, or the U.S. mid-Atlantic, where electricity costs 2.5¢ per KwH.
Because of the high cost, wind ventures fail to draw the private-sector money required, Mr. Adams said, adding that the 100 MW wind power project in Quebec’s Gaspé region was backed by Hydro-Québec, the government-owned utility.
Mr. Austin, however, said he’s convinced the venture can attract third-party investors. He argued that power from the wind farm could be sold to B.C. Hydro, neighbouring jurisdictions such as Alberta and the U.S. Pacific Northwest, or big industrial companies in the province – specifically citing Alcan Inc., which has a smelter in Kitimat.
Moreover, a number of energy giants, such as Suncor and Royal Dutch/Shell Group, have indicated they will invest millions to develop alternative energy projects.
He added company executives would likely apply for money available through established federal programs, but said he would not be involved in that process given his role as a Senator.
“I don’t blame people for being skeptical – the location is remote, the market is not close,” Mr. Austin said. “I started out being a skeptic, too. But once I looked at various aspects, then I was convinced that this was worth undertaking.”