Power for Nova Scotia - April 29th 2014

Muskrat Falls is a waterfall in Labrador that is being harnessed to generate electricity for the province of Newfoundland & Labrador.  The project, managed by Nalcor Energy, is already under construction and will include a subsea cable from Labrador to Newfoundland to transmit the power.  Once up and running, the old oil fired power station at Holyrood will be shut down.  This is all good news for Newfoundland & Labrador.  The province switches from burning fossil fuel to using renewable energy in an installation that is likely to last for many years.

For Nova Scotia, the benefits are not nearly so clear.  Emera, the owners of Nova Scotia Power have a commitment from Nalcor that Nova Scotia can have 20% of the power generated from the project for the next 35 years.  Nalcor refuse to commit to increase that amount and on the project website even say that Newfoundland & Labrador will need the remaining available power in a few years anyway.  To get the power to Nova Scotia will require the installation of a subsea cable from Newfoundland to Cape Breton to connect into the Nova Scotia grid.  The cable project is estimated to cost $1.52 billion.  The total population of Nova Scotia is of the order of 920,000 souls.  The cost of the project thus represents nearly $1700 for every person in the province or approximately $5,000 per household.  If the project expenditure overruns its budget as these large projects tend to do, then this cost will likely increase.  There are other problems with this project too.  Transmitting power over long distances results in significant loss of power over the length of the line.  Losses depend on transmission voltage and distance.  For example, a 100 mile 765 kV line carrying 1000 MW of power can have losses of 0.5% to 1.1%. A 345 kV line carrying the same load across the same distance has losses of 4.2%.  The distance from Muskrat Falls to Halifax by the proposed cable route is of the order of 1300km (over 800 miles).  The losses over that length of line will be significant.

The trend in power generation and management is to move towards eliminating transmission losses altogether by generating the power where it is needed.  Smart appliances are becoming available that turn themselves off when power requirements are high and that consume extra power when there is plenty available.  A refrigerator for example can turn itself off for several hours without compromising its contents and can catch up again when more power is available.

Small scale power generation projects in Nova Scotia are not encouraged in any way.  Nova Scotia Power’s net metering arrangement is heavily biased away from consumers.  There are no grants to home owners for installing small power projects.  The net result of this discouragement is that the payback to consumers of investing in green power projects such as solar panels or wind turbines is well in excess of twenty years.  No wonder you don’t see solar panels on roofs in Nova Scotia.  Compare that situation with what happens in Europe.  Capital grants are readily available there and locally generated excess power is valued because of the savings to the power companies in both generation and transmission costs.  Typical payback times for consumers are of the order of three to five years making it much more sensible for them to invest in such projects.

So, Nova Scotia Power, here’s a proposal for you.  Don’t spend $1.52 billion (or anything at all) on a power cable from Labrador.  Instead, setup a system that gives grants to homeowners to cover 1/3^rd of the cost of installation of local power generation (subject to certain conditions of course).  Revise the net metering agreement so that payouts for excess power are more equitable and reconcile monthly not annually.

Let’s estimate that 1/10^th of the households (and businesses) in Nova Scotia take up the offer of grants over the next three years and overall reduce the total power consumption in Nova Scotia by an amount equal to that which was going to arrive from Labrador.  Total cost to Nova Scotia Power in grants and not having to invest in capital projects would be of the order of $560 million.  Total savings compared with the Muskrat Falls project are of the order of $1 billion.  Consequential benefits would include the generation of many jobs in the installation of these systems.  Instead of generating jobs in remote Labrador, these jobs would be where people actually live.  How green is that?