Green Action Centre intervened in Manitoba Hydro’s “Need for and Alternatives To” (NFAT) hearing before the Public Utilities Board (PUB). We were able to engage three energy experts to analyze Hydro’s filings and make recommendations. Their work is described here. The hearing is over and Green Action Centre awaits the PUB’s report due June 20, 2014. On May 20th, 2014, we made our final submission.
Manitoba Hydro’s preferred development plan was to build two new northern dams, 695 MW Keeyask and 1485 MW Conawapa; an additional 750 MW transmission line or “intertie” connecting Manitoba, Minnesota and Wisconsin; and new export contracts, which (a) enable the transmission line to be built in the U.S. and (b) help pay for the new dams until Manitobans need all the power.
However from the outset Manitoba Hydro separated the first phase for immediate decision – building Keeyask and the intertie to supply new export contracts – from the decision to build Conawapa.
After reviewing mountains of evidence and 48 days of oral hearing, Green Action Centre concludes that the first phase of the plan is justified. Particularly valuable is the new U.S. transmission line, which will:
- improve reliability and export markets for Hydro’s system,
- bring long-term benefits to Manitoba and its taxpayers and ratepayers,
- increase support for wind and solar renewables in the US, and
- displace coal and gas in the US to mitigate climate change.
All interveners and Manitoba Hydro itself agreed that conditions are not right for Conawapa at this time.
Green Action Centre made further recommendations as well:
- Manitoba Hydro should pursue its proposed level 2 Demand Side Management, but augmented to achieve a flat load as found in other leading jurisdictions.
- Ancillary to an aggressive and enduring Demand Side Management commitment, Manitoba Hydro should pursue enabling and supportive policies, including conservation rates, programs encouraging the selection of alternative fuels over electric heat, and mechanisms for facilitating customer-owned generation and energy substitution using waste heat and industrial and agricultural byproducts.
- Because rates will rise faster than inflation under all plans, vulnerable persons with a high energy burden require bill mitigation through targeted retrofit and efficiency programs, special rate design and, in some cases, discounted bills.
- There is a strong case against new natural gas generation, especially for baseload. Our prime export market, Minnesota, has legislated against new base power supply from fossil fueled generation. Manitoba may lose export customers (or pricing advantages) if it surrenders its clean energy brand and adopts gas generation for new supply. These economic considerations only strengthen Manitoba’s commitments to clean energy.
- It is important to distinguish natural gas for heating in Manitoba and natural gas used to generate electric power, whether in Manitoba or elsewhere. Because of the difference in their efficiencies, (>90% for a gas furnace vs 20-50% for gas turbine or coal power generation), heating with electricity in Manitoba causes 2 to 3 times the GHGs to be produced in the US from replacement coal and gas generation than heating with a high-efficiency gas furnace. From a climate change perspective, Manitobans seeking “fossil fuel freedom” should convert to wood pellet stoves or high-efficiency geothermal rather than electric heat. In addition, Manitoba Hydro could offer a “renewable natural gas” premium option for gas customers who wish to green their heating using methane from landfills and elsewhere, such as FortisBC offers.
- Options for future resource plans should be developed through an integrated resource planning process with opportunities for public and expert outsiders to propose and comment on resource alternatives. BC Hydro provides a recent example. The range of resources to be considered would include conservation alternatives including “demand response,” which can lower peak demand at critical times; alternative renewables like wind and solar; customer generation, including combined heat and power; and strategic transmission and grid improvements that enable integration of distributed generation sources.
- Finally, Green Action Centre recommends that Manitoba Hydro do more to involve stakeholders in strategic planning processes, including new directions for Power Smart, rate design, addressing the needs of vulnerable customers, and optimizing natural gas policies to mitigate climate change. The closed planning circle between the Provincial Government and Manitoba Hydro needs to be opened up, both to insure that all the options are given due weight and to improve public trust.