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Funds to link Ontario grid to Manitoba hydropower

Canada ecoTrust awarded C$586.2 million (US$496.6 million) to Ontario for energy-related programs, including an East-West transmission line to allow import of hydropower from new projects in Manitoba.

Canadian Prime Minister Stephen Harper said March 6 the national government is providing the funding to Ontario as part of the Canada ecoTrust for Clean Air and Climate Change, an initiative to support projects that reduce greenhouse gas emissions and air pollutants.

Ontario said it would use the funds to advance clean energy projects that bring measurable reductions in greenhouse gas emissions, such as increasing Ontario’s supply of clean and renewable electricity. Ontario also is to use the funds to support the phase-out of its coal-fired power plants.

The announcement advances a 2005 agreement between Ontario and Manitoba for a joint venture to build hydropower projects in Manitoba and a transmission line capable of delivering at least 1,500 MW to Ontario. The Clean Energy Transfer Initiative described in that agreement involves developing hydropower sites in northern Manitoba, including the 1,250-MW Conawapa project.

Initiative to benefit all provinces, territories

Harper first unveiled Canada ecoTrust during an appearance in Québec. At that time, he announced the government would provide C$349.9 million (US$296.4 million) to Québec to support the province’s 2006-2012 action plan for climate change. Québec indicated it would use the funds for several projects such as developing renewable energy sources in rural regions.

Canada ecoTrust allows each province and territory to develop technology, energy efficiency, and other projects that benefit the environment. It is to consist of C$1.5 billion (US$1.27 billion) of new funding on a national basis.

Manitoba, Fox Lake Cree agree on process for Conawapa

Representatives of Manitoba Hydro and Fox Lake Cree Nation signed an agreement, advancing development of the C$5 billion (US$4.3 billion), 1,250-MW Conawapa hydroelectric project in northern Manitoba.

The agreement sets out a process and funding mechanism for the first nation’s participation in planning and consultation on development of Conawapa, on the Nelson River downstream of Gillam. It also covers environmental and regulatory matters, training, and employment and business opportunities.

“The activities supported through this agreement will ensure that Fox Lake Cree Nation is fully engaged and that all parties have the best information available for decision making,” Manitoba Hydro President Bob Brennan said.

Manitoba Hydro said the agreement, signed in February, is consistent with the utility’s approach to working closely with first nations to plan and develop new power projects. Manitoba Hydro completed a process agreement with the York Factory First Nation in 2006. It plans a similar agreement with Cree Nation Partners, consisting of the Tataskweyak Cree Nation and War Lake First Nation.

BC Hydro begins redevelopment of 24-MW Aberfeldie project

The British Columbia Utilities Commission granted a certificate of public convenience and necessity to BC Hydro, the final permit necessary for the utility to begin redevelopment of the Aberfeldie hydroelectric station on the Bull River east of Cranbrook.

Plans for the C$86 million (US$73 million) redevelopment call for a 24-MW powerhouse to be built next to a 5-MW powerhouse targeted for removal. The project also includes a new surge tower and switchyard, a new penstock, and improvements to a water intake, dam, and access road.

Construction activity commenced with the approval of the utilities commission, which issued the permit in February, the utility said.

BC Hydro awarded a C$32 million (US$27.2 million) contract for civil work to Western Versatile Construction Corp., also in February. Western Versatile, in turn, sub-contracted with several local companies for work such as blasting, dredging, and environmental monitoring. BC Hydro said it also hired contract administration staff and reached an agreement with native groups to support the project.

Contractors previously named include VA Tech Hydro Canada Inc., which is to supply and install turbines, generators, and related equipment under a C$14 million (US$11.9 million) agreement. Knight Piesold Ltd. was awarded a contract in April 2005 to provide detailed engineering design.

Aberfeldie ceased operation in October 2006 in preparation for redevelopment. The Aberfeldie redevelopment will help fill a growing gap in electricity supply in British Columbia when it is fully operational by fall 2008, BC Hydro said.

NB grid access requested for 2,824-MW Lower Churchill

Newfoundland and Labrador Hydro (NLH) requests long-term transmission service from the New Brunswick System Operator for Newfoundland’s proposed 2,824-MW Lower Churchill hydroelectric project.

Lower Churchill would include two power plants on mainland Labrador, 2,000-MW Gull Island and 824-MW Muskrat Falls. To make the project feasible, it requires that electricity be wheeled through neighboring provinces to more populous markets in Canada and the United States.

Newfoundland previously applied to Québec and Ontario for permission to wheel power in that direction. The latest application envisions the possible construction of a subsea cable to carry power to New Brunswick.

“The recent heightened attention to climate change reinforces our view that new hydroelectric development has an important role to play in reducing greenhouse gas emission from power generation,” Newfoundland and Labrador Premier Danny Williams said. “The Lower Churchill is an ideal project which fulfills this country’s ambition to see more environmentally sensitive energy development.”

Concurrent with the New Brunswick request, NLH made a request to Hydro-Québec to increase the transmission capacity it is reserving from Québec into New Brunswick to be consistent with the New Brunswick request.

The Newfoundland minister of Environment and Conservation has required the preparation of an environmental impact statement for Lower Churchill. NLH began that process in December 2006 by registering the project with province and federal environmental regulatory agencies.

Work also is proceeding in other areas including impact and benefit negotiations with Labrador Innu, engineering, project executing planning, and financing.

NLH seeks to achieve project approval in 2009 and first power by 2015.

Ontario awards standard offer contracts to two projects

The government of Ontario awarded contracts to two small hydroelectric projects totaling about 2.5 MW and to 20 other energy projects that submitted applications to its renewables Standard Offer Program.

The contracts represent a total capital investment of C$336 million (US$288 million) and involve four sources of renewable technology and projects totaling more than 165 MW.

For hydro, the government selected Veridian Connections’ 950-kW McLeod Dam project in Belleville and Lakeland Power Distribution’s 1.5-MW High Falls project in Bracebridge. The other projects are powered by: solar, 22.9 MW; biomass, 10.2 MW; or wind, 129.5 MW.

The 22 contracts were the first awarded under Ontario’s Standard Offer Program, which allows small generators of electricity from renewables under 10 MW to supply energy to the grid. The province said the program is the largest of its kind in North America and expects to add 1,000 MW from renewables to the grid over ten years.

Fifty-eight other applications were submitted; contracts will be awarded as those applications are evaluated, the Energy Ministry said. All standard offer contracts are contingent on municipal and environmental approvals.

The Standard Offer Program is a collaboration of the Ontario Power Authority, Ontario Energy Board, local distribution companies, and organizations promoting energy from renewables. It provides standard terms and conditions intended to make it simpler and less costly for operators of small renewable energy facilities to participate in Ontario’s electricity supply system.

Second Canada native group supports East Toba-Montrose

Plutonic Power Corp. signed an agreement with a second First Nation to help advance construction of the 196-MW East Toba River and Montrose Creek hydroelectric project in British Columbia’s Toba River Valley.

Plutonic signed a term sheet with the Sliammon First Nation, setting out essential terms of a benefit agreement to be completed between the parties. It previously signed a similar pact with Klahoose First Nation. Plutonic is working on another agreement with a third group, Sechelt First Nation.

The newest agreement calls for Sliammon First Nation to support Plutonic’s construction and operation of the project and a 145-kilometer transmission line that will cross traditional territory of the Sliammon First Nation. The line is to extend from the project’s two powerhouses to an interconnection point with the British Columbia Transmission Co. grid at Slatrey Bay on the north shore of Jervis Inlet.

Plutonic said it would recognize and respect Sliammon assertion of aboriginal title and rights, archaeological sites and artifacts, and traditional use of the area. Plutonic will provide Sliammon members with opportunities for employment, training, and contracting. The First Nation also will receive cash payments during construction and operation of the project.

In 2006, Plutonic signed agreements to supply BC Hydro about 752 gigawatt-hours per year for 35 years from 123-MW East Toba River and 73-MW Montrose Creek and from 15-MW Rainy River, where project construction is scheduled to begin in July.

Fund manager takes stake in Abitibi hydro venture

Institutional fund manager Caisse de depot et placement du Québec will take a 25 percent stake in a joint venture to operate Abitibi-Consolidated’s eight hydro facilities in Ontario, the paper and forest products company announced.

Abitibi-Consolidated said it will retain a 75 percent interest in the joint venture, ACH Limited Partnership, while Caisse will acquire the 25 percent interest. Caisse also will provide a 10-year unsecured loan of C$250 million (US$211.4 million) to ACH to help fund the acquisition. The transaction is expected to yield gross proceeds of C$297.5 million (US$251.6 million) to Abitibi-Consolidated.

Scotia Capital and CIBC World Markets advised Abitibi-Consolidated about the transaction.

Abitibi-Consolidated said its substantial ownership interest in the joint venture reflects the ongoing strategic importance of its hydro assets. The company added that it plans to continue to operate and manage the facilities.

Facilities involved in the transaction have an aggregate installed capacity of 136.8 MW, and annual generation of about 828 gigawatt-hours.

Abitibi-Consolidated to merge with Bowater

In another announcement, Abitibi-Consolidated disclosed it planned to merge with Bowater Inc. to form AbitibiBowater Inc., the third largest publicly traded paper and forest products company in North America.

AbitibiBowater’s headquarters will be in Montreal, with a U.S. regional manufacturing and sales office in Greenville, S.C.

In 1999, Bowater sold its Great Northern Paper unit, including six hydro plants and 18 dams in Maine, to Québec-based Inexcon Maine Inc.

Canada launches assessment of 161-MW Upper Pitt River

The government of British Columbia initiated the environmental assessment (EA) process for the proposed Upper Pitt River Power project, a cluster of eight run-of-river facilities totaling 161 MW on tributaries of the Upper Pitt River north of Pitt Meadows.

British Columbia’s Environmental Assessment Office (EAO) issued an order finding that an environmental assessment certificate is required for the project. The developer, Northwest Cascade Power Ltd., is not permitted to proceed without an assessment, EAO said.

The scope of the assessment will be set out in a procedural order, EAO said. The order also will specify procedures and methods for conducting the assessment, including requirements for public and First Nation consultations.

The procedural order will require that Northwest Cascade, a subsidiary of Run of River Power Inc., prepare terms of reference for its environmental assessment application. It will specify a process for reviewing and approving terms of reference outlining information needed for the application.

EAO also said the project likely would be subject to review under the Canadian Environmental Assessment Act. Those requirements are to be integrated into British Columbia’s EA process, in accordance with an agreement between the federal government and the province.

The company announced plans in October 2006 to develop eight hydroelectric plants totaling 120.7 MW at the sites, in the Pitt River watershed between Vancouver and Whistler. The proposed plants and their capacities as now envisioned are: 35-MW Bucklin; 16-MW Steve; 23-MW Pinecone; 15-MW Homer; 26-MW Boise; 16-MW Shale; 15-MW Corbold; and 15-MW East Corbold (ZZ). Corbold and East Corbold (ZZ) would share a powerhouse.

The Upper Pitt River Power project will cost about C$330 million (US$282 million) in terms of capital investment. Its power plants are expected to be built sequentially from 2009 to 2015. Power is to be sold into the electricity market, primarily to BC Hydro.

McFarlane honored for contribution to Ontario hydro

The Ontario Waterpower Association presented its Ronald A. Dodokin Award to Murray McFarlane in recognition of his significant contribution to hydropower in Ontario.

McFarlane is manager of small hydro for Hatch Energy in Niagara Falls, Ontario. He was primary author of a recent report prepared by Hatch Energy, “Evaluation and Assessment of Ontario’s Waterpower Potential.” (See “R&D Forum,” March 2007.)


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