Connecting Remote Communities to Create Sustainable Systems

Transcription

1 Connecting Remote Communities to Create Sustainable Systems NAN Chiefs Energy Conference January 31, 2012 Stephen Lindley Vice President, Aboriginal and Northern Affairs, SNC-Lavalin Inc.

2 Presentation Objectives Transmission system expansion options in Ontario Northwestern Ontario Interconnection Draft Supply Mix Directive (Nov. 2010) Opportunities for First Nation and/or Private Sector Involvement?

3 Draft Supply Mix Directive On Tuesday November 23, 2010 the Ontario Minster of Energy released the government s Long-Term Energy Plan (LTEP) and Supply Mix Directive The priority projects are: i. Series compensation in Southwestern t Ontario; ii. Upgrading existing lines west of London; iii. New transmission line West of London; iv. Enhance the East West tie along the east shore of Lake Superior through a new line; and v. New line to Pickle Lake. Draft Supply Mix Directive, Ontario Minister of Energy, November 23, 2010

4 WPWG/NADF Study 2009 Examined options for a more reliable, cleaner, and less costly supply service to First Nations communities in remote Northern Ontario, which are presently served by diesel generation Examined the means of making the renewable energy resources in Northern Ontario available to the loads in the south

5 The Interconnection Concept Sachigo Lake Bearskin Lake Kitchenuhmay Wapekeka Kasabonika Lake Muskrat Dam Wawakapewin Sandy Lake Keewaywin Weagamow (NC) Kingfisher Lake Wunnumin Nibinamik Webequie Ring of Fire Bear Head Lake Deer Lake North Spirit Lake Musselwhite 115 kv private line Neskantaga Pikangikum 44 kv private line Poplar Hill Red Lake 44kV 115kV HONI 230kV Hydro Substation Pickle Lake? Valora/Igance? Whitesands Gull Bay Eabametoong Little Jackfish Wind Farm Tap Albany River

6 Diesel Estimated Costs Cost = $0.78/kWh Revenue = Hydro One Remotes (HORCI) Residential Revenue = $0.09/kWh09/kWh Independent Power Authority (IPA) Residential Revenue = $0.14/kWh Remaining revenue is from federal/provincial subsidies: HORCI = $0.69/kWh (largely provincial from pool) IPA = $0.64/Kwh (largely federal from fuel subsidy)

7 Grid Estimated Costs Cost = $0.055 (energy) + $0.03 (transmission) + $0.06 (distribution) (misc) = $0.155/kWh Ontario Residential Rate = average $0.12/kWh Remaining revenue comes from the transmission pool = average $0.035/kWh (from provincial pool) Estimates based on historical Five Nations Energy Inc. data and current average 7

8 Comparison per kwh (residential) HORCI IPA Grid Energy $0.78 $0.78 $0.055 Tx and Dx Included in above Included in above $0.10 (est) Residential Revenue $0.09 $0.14 $0.12 Subsidy $0.69 $0.64 $ OPA, HONI, 2009

9 HORCI, IPA and Grid Communities WEENUSK MUSKRAT DAM KEEWAYWIN NORTH SPIRIT LAKE POPLAR HILL KOOCHECHING PIKANGIKUM WAWAKAPEWIN NIBINAMIK WUNNUMIN LAKE MARTEN FALLS EABAMETOONG HORCI IPA GRID

10 Linkages to Generation Passes through regions with high potential for hydro & wind generation & mining development Muskrat Dam & Wunnumin hydro site Albany, Winisk and Attawapiskat River hydro sites Development of many small generation resources close to the communities

11 Hydro Generation Resources in the Area River/Lake No. of Sites Nearby FN Community Min Potential Generation (MW) Max Potential Generation (MW) Winisk River 5 Webequie Albany River 4 Ebametong (Fort Hope) Albany River 6 Marten Falls Albany Tributary 2 Marten Falls Winisk River 3 Winisk Pipestone River Tributary 1 Wunnumin Lake Otoskwin- Attawapiskat River 6 Neskantaga Total (MW)

12 Regional Context Study Area NORTHWESTERN Ring of Fire

13 Ring of Fire Power Supply Requirements Cliffs Natural Resources estimates: 30MW power requirement to run mine and concentrator at mine site; approximately 300MW required for ferrochrome processing location north of Sudbury has been identified as technically feasible site for base case Noront Resources estimates six 2,400 kw diesel generators required for mine and concentrator at mine site; anticipate transporting Ni concentrate to existing facilities for further processing

14 Power Supply Options There are a number of options being considered for power supply into northern Ontario Cliffs Natural Resources/Noront/Canada Chrome led initiative joint or separate? First Nations led initiative with First Nation communities and/or mining companies as customers? Provincial or federal government led initiative? Some combination Link direct to grid Link to grid with supplementary local generation Local generation only

15 Linkages to Grid Ring of Fire Area Attawapiskat DS VICTOR MINE Kashechewan DS Fort Albany DS

16 Potential Areas of Involvement for First Nations Possible compensation: impact-benefit agreement and/or compensation for environmental or socio-economic impacts Employment opportunities for unskilled, semi-skilled and skilled labor for construction and ongoing operations/maintenance Possible formation of FN businesses for services during construction and operations: brush clearing, catering/servicing i i of construction camps, ongoing ROW maintenance or access road maintenance Possible business participation partnerships to be p p p p developer/owner/operator of power (thru FIT?) and other infrastructure projects

17 Business Partnerships First Nations/Developer partnerships can be beneficial to all parties Can be as simple as debt or equity ownership in a project (0% - 100%) Business models in some circumstances have involved modest initial equity position for FN (potentially derived from impact-benefit and compensation payments), with buy-back b provisions i to increase FN equity position i over time

18 Business Partnerships Not limited to simple financial partnerships can be a broader and richer relationship seeking a mutually beneficial alignment of interests. Can include: Training and capacity building Employment Provision of goods and services Long-term continuing community involvement Respect for the environment No one model will suit all occasions need flexibility to meet the unique requirements of each business partnership while ensuring equitable treatment between First Nations and compliance with federal and provincial law

19 Connecting Remote Communities to Create Sustainable Systems NAN Chiefs Energy Conference January 31, 2012 Stephen Lindley Vice President, Aboriginal and Northern Affairs, SNC-Lavalin Inc.