Jim Chliboyko
Business Edge Vol.1 No.23
November 24, 2005

 Provinces take first step to send electricity east

A $500-million energy agreement between Manitoba and Ontario could be the first step in reviving a long-shelved $10-billion generation project that would send Manitoba electricity to power-starved Ontario.

The Manitoba government last month announced a $500-million deal with its eastern neighbour that officials hope will pave the way for the Conawapa project, which would send thousands of megawatts across the Canadian Shield to heat and light hundreds of thousands of Ontario homes.

"What we have agreed to do is to look at a subsequent phase," says Manitoba Hydro spokesman Glenn Schneider. "That would mean that we would need to construct additional facilities. That would mean Conawapa. We are very optimistic that we will reach a second-phase agreement and start working on planning."

The deal involves the transmission of 150 megawatts (MW) of power beginning in 2006. That will require upgrades to the power connections between Winnipeg and Thunder Bay, which will double the existing east-west grid capacity at the Manitoba-Ontario connection point. The two provinces will share the estimated $100-million pricetag. In 2009, that transfer will be increased to 400 MW.

Photo courtesy of Manitoba Hydro

The proposed Conawapa dam site on the Nelson River is back on the power-generation radar.

Negotiations will continue on a second phase, which could see up to 3,000 MW of power transmitted, but for that the Conawapa dam needs to be in place.

Conawapa – a 1,250-MW dam on the Nelson River in northern Manitoba – was cancelled in the early 1990s when Ontario pulled out of the initial deal. The original construction cost was estimated at $5 billion when the dam was first proposed, but inflation has increased that estimate to between $8 and $10 billion.

A feasibility study released last month by the two provinces estimated the dam could power 600,000 homes and create 80,000 person years of employment during the dam’s construction, government officials say.

The cross-border power deal – and the prospect of reviving the Conawapa project – has been met with skepticism by Tom Adams, executive director of the watchdog agency Energy Probe, who has reservations about the "fogginess" of the details.

"I know they are trying to present it to the public as a kind of a package," says Adams.

"It behooves us to be cognizant of the hype that has surrounded this for so long. Both governments have been yabbering on about Conawapa, but there is no signed contract nor any transmission study."

Ontario Premier Dalton McGuinty has said that Ontario will need to look for new sources to supply 25,000 MW of energy within the next 15 years, especially since he has vowed to close all of Ontario’s coal-powered generation stations within four years.

Bruce Power is spending billions of dollars to refurbish two nuclear reactors on Lake Huron, which when completed will produce 750 to 800 MW of power each.

But having a better cross-border connection is considered key to stabilizing power supplies and minimizing problems such as the power blackout that hit Ontario and the eastern United States in 2003.

Tapping into Manitoba’s hydro surplus is also on the radar for Premier Gary Doer. In a speech to the Empire Club in Toronto last October, Doer noted the lack of power sharing between Canadian provinces.

Proposed and existing hydro dams

"I’ve got a map up here in terms of the North American power grid and I think a picture’s worth a thousand words," Doer told the audience.

"You can see there are three north-south spaghetti lines of transmission going from Canada to United States. You can see also, that this country has no grid east and west. The empire, if you will, has no grid … It’s an issue we should have on our national agenda."

The two provinces have said they will seek federal funding for the dam project, although so far Ottawa has not agreed to chip in.

But sending Manitoba energy east isn’t a simple task because it requires the stringing of transmission lines over much of the vast and isolated Canadian Shield, Energy Probe’s Adams notes.

"That is a lot of real estate. The distances we are talking about are not just vast, but particularly harsh. There is almost no communication infrastructure, in terms of roads, railways, airstrips, in the straight line between Wawa and Conawapa."

Glenn Schneider

"Contrast this with Labrador power, and there are some interesting comparisons. The distance from Conawapa to Toronto is almost identical between the Lower Churchill and Toronto. The main difference is that Labrador path is already developed. High-voltage lines go almost the entire distance."

Nor are they easy to initiate. One of Manitoba’s current projects, the Wuskwatim dam, will be a relatively modest 200-MW dam that will flood an estimated one-half square kilometre on the Burntwood River near the City of Thompson. Wuskwatim will cost an estimated $900 million and take six years to build.

For that project, Manitoba’s Clean Air Commission had 32 days of public hearings on the potential impacts of the dam before giving the project an OK. Authorities are awaiting an environmental report to be translated into French before starting the public hearing process.

As well, the Nisichawayasihk Cree First Nation will hold a referendum on whether the dam should proceed. A date for that vote has not been set.

And while the bigger Ontario deal isn’t written in concrete yet, Manitoba Hydro sounds cautiously optimistic. "We don’t have a deal at this point," says Hydro’s Schneider. "They may decide not to go in this direction. We’re hopeful, they are sincerely looking at it as a sincerely viable option."