Old King Coal’s comeback in Alberta will take a tremendous toll on the environment without lowering short-term energy prices, say environmental groups and alternative energy producers.
They’re urging the province to abandon coal-fired power generation, and instead provide financial incentives to consumers and businesses to improve energy conservation and efficiency and build more clean alternative energy projects.
New coal-fired power generation plants announced by Alberta’s major utility companies “aren’t going to reduce our power bills next year,” because it will be 2005 before they’re operating, says Chris Severson-Baker, environmental policy analyst for the Pembina Institute, an Alberta-based environmental research organization.
Burning more coal, which increases greenhouse gas emissions and air pollutants such as mercury “is a step backwards” on the path to a “greener” energy future, says John Keating, chief executive of Canadian Hydro Developers Inc., a Calgary-based renewable energy developer.
But Alberta’s major utility companies argue that coal is abundant, cheaper than natural gas and still has a key role to play in the province’s energy mix.
TransAlta Corp. and Epcor also say they’re committed to reducing their new plants’ greenhouse gas emissions, by funding “offset” projects that give them credits for reducing emissions elsewhere in Canada and abroad.
“What we’re trying to do is be as environmentally responsible and accountable as we can as a company, and still supply the electricity needs of the people of Alberta,” TransAlta spokesman Mike Kelly says.
Terry Bachynski, senior vice-president of corporate and regulatory affairs at Epcor, says while energy conservation is important, there’s a need to satisfy ever-increasing demand for electricity. “We are in the business of supply and there is something we can do about that.”
Epcor has announced a $500-million, 400-megawatt expansion of its Genesee coal-fired plant west of Edmonton. TransAlta plans a $1.8-billion, 900-MW expansion of its Keephills coal-fuelled generator in the same area.
Both plants are scheduled to be operating in 2005.
Enmax Corp. and Fording Coal Ltd. also are considering a 400-MW coal-fired generator east of Calgary.
TransAlta’s new plant will emit an additional six to seven million tonnes of greenhouse gases into Alberta’s air, Kelly says. Epcor’s Genesee 3 expansion will contribute another 1.5 million tonnes, Bachynski says.
Most scientists blame greenhouse gases for global warming. Emissions from Canada’s electricity generation sector increased 17 per cent between 1990 and 1997, according to figures provided by utilities to a national voluntary reporting program.
Coal-fired plants are also one of Canada’s biggest sources of mercury emissions, Severson-Baker says.
Environment Canada is spearheading a national initiative to reduce industrial emissions of the toxic heavy metal. In the U.S., the Environmental Protection Agency plans to regulate mercury emissions from coal-fired plants by 2004.
Alberta has no regulatory limits on mercury emissions from power plants.
Coal now provides less than 75 per cent of Alberta’s generation capacity, compared with more than 90 per cent two decades ago.
Natural gas burns cleaner than coal, with fewer greenhouse gas emissions. But relying too heavily on one major fuel source would leave Albertans exposed to the price of that fuel in an often-volatile global market, Bachynski says.
“From our point of view, the prudent approach is to have a balanced portfolio in fuel sources.”
Epcor’s energy portfolio includes about 48 per cent coal, he says. The remainder includes natural gas, co-generation, landfill gas capture, low-impact run-of-the-river hydro and a deal to purchase the entire 750-MW from a wind farm planned on the Peigan First Nation in southwest Alberta.
The shift to non-fossil fuel sources must be balanced with what’s economically practical and environmentally achievable, Bachynski argues.
But the Pembina Institute says the race to satisfy demand ignores the importance of energy conservation and efficiency.
“(Energy) conservation in Alberta is completely untapped,” Severson-Baker says.
The Alberta government scrapped its energy-efficiency branch about 10 years ago, he says. “People don’t have any incentive, other than increasing costs of power, to make capital investments in energy efficiency improvements.”
Instead of doling out energy rebates, the government should use that money to offer tax incentives or low-interest loans to homeowners to buy products or make improvements that reduce energy consumption, and to companies to build new clean energy sources, Severson-Baker says.
Kelly notes that when TransAlta announced its Keephills expansion, it also made its second $5-million investment to buy wind-generated electricity from Calgary-based Vision Quest Windelectric Inc.
TransAlta will buy 2.6 MW of the wind power to supply its Calgary corporate offices, while 23.8 MW will be put into Alberta’s power grid.
Bachynski says energy conservation and efficiency alone can’t address the demand for power in Alberta, which is forecast to increase about three per cent per year during the next 10 years.
Alberta’s reserve generation capacity, needed to meet peak power demand times, has recently dropped on occasion to below 10 per cent from the desired 15 per cent, he says. “Genesee Phase 3 would provide low-cost, reliable power to the grid and help displace some of the expensive power we currently have to keep importing.”
Severson-Baker says Alberta hasn’t thoroughly investigated what the electricity shortfall is likely to be, especially if energy conservation and alternative energy projects were promoted. “We might not need as much new supply of power.”
In the U.S., a report by the American Council for an Energy Efficient Economy says that country’s projected demand by 2010 could be reduced by more than 60,000 MW, or about 40 per cent, if utilities and regulators implemented nationwide energy-efficiency programs in homes and businesses.
If Alberta’s utilities want to burn more coal, they should either purchase an equal capacity of green power or build an equivalent amount of zero-emission projects, says Canadian Hydro Developers’ Keating. “Don’t just do it on a token basis.”
Bachynski says Epcor’s Genesee 3 will be eight to 10 per cent more efficient than the plant’s existing two units, and 18 per cent more efficient than the average coal-fired plant in Alberta. “It’s the most advanced technology ever built in Canada.”
Epcor also has set aside about $120 million to acquire offset projects in Canada and abroad, to reduce the net increase of greenhouse gases by 50 per cent. That means the incremental increase from Genesee 3 “would be the same as if we chose natural gas” instead of coal as fuel, Bachynski says.
TransAlta officials believe that the regulatory process for a new plant can be accomplished within a year, Kelly says. But he dismissed a Calgary newspaper’s recent report that the corporation threatened to cancel its plant unless it was approved within a year.
“It’s never been our intent to short-circuit the approval process,” Kelly insists.
Epcor’s Bachynski says: “We are not going to try and (speed) the regulatory process at the price of the ability of stakeholders to be informed, involved, and for their opinions and ideas to be considered.”
