Winnipeg Free Press, opinion editorial Posted: 07/7/2018 4:00 AM
Electricity is the "new" energy which, over the next decade or two, will replace the internal-combustion engine in our cars, trucks, buses and trains. Economics will be the driver. The sticker prices of electric vehicles are expected to be cheaper than those of gasoline-driven cars by 2025. The diesel locomotive will go the way of the old steam locomotive.
This disruption provides great opportunities for Manitobans, but reluctance to change must be overcome. Manitoba Hydro can be an initiator if the National Energy Board, having concluded its hearings on the proposed $1.1-billion transmission line to the U.S., rejects Hydro’s request. How could the blocking of this new transmission line be an opportunity for the province?
It all hinges on what to do with the surplus electricity that will be generated by Keeyask. Hydro’s website claims Keeyask will be completed in 2021. In its application to the Public Utilities Board earlier this year for a 7.9 per cent rate increase, Hydro revealed that Keeyask is not needed for Manitoba’s electric demand until 2040.
This is further complicated by the Efficiency Manitoba Act, requiring Hydro to reduce electricity growth by 1.5 per cent annually for the next 15 years. Certainly, this act needs revision if Keeyask’s surplus energy is to be delivered directly to the province to grow its economy and to meet the needs of increased electric transportation.
Just to keep Keeyask and the proposed new transmission line operating will require more than $400 million per year. Since 2010, Hydro has consistently received an average of about four cents per kilowatt hour for its exported electricity. Because of the plummeting generating costs of solar and wind, even with energy storage, we cannot expect that export prices will increase.
So, if we take the energy Keeyask will generate, adjusted for losses, at 4,000 gigawatt hours per year, and if we multiply it by the average of four cents it will receive for each kilowatt hour it exports, then Keeyask will only bring in about $160 million each year. This is much less than the $400 million it takes to produce it, explaining the need for the 7.9 per cent rate increases Hydro requested.
If the NEB rejects Hydro’s request to build the $1.1-billion transmission line to the U.S., as some interveners have proposed, then Manitoba Hydro can use some or all of this money to co-fund — with business, municipal, provincial and federal governments — initiatives to start delivering surplus Keeyask energy within Manitoba in spite of the Efficiency Manitoba Act. There is still enough capacity on the existing transmission lines to the U.S. to export most surplus energy from Keeyask until we can use it all for Manitoba.
Op-ed writer Nazim Cicek proposed, in the Winnipeg Free Press on April 27, "freeing up surplus renewable electricity capacity that could be used to attract electricity-intensive new industries and jobs." He suggested that such industries could include advanced manufacturing, urban and northern agriculture (including cannabis cultivation), electrolysis-driven fertilizer production, value-added food and fibre processing, blockchain-based services, software developers and computer server farms.
What are other electric utilities doing in this regard? Southern California Edison is proposing a $US780-million program to increase the availability of charging for passenger electric vehicles. Pacific Gas and Electric of California is developing two new five-year programs aimed at accelerating widespread electric vehicle adoption.
In addition, London and Mexico City have committed to procure only zero-emission buses from 2025. Paris aims to electrify all of its 4,500 buses by 2025, Copenhagen has committed to procure only zero-emission buses from 2019, and Los Angeles has the same target for its fleet of 2,200 buses by 2030. Manitoba Hydro should get in on the act and support bus-charging stations in the province.
New business would grow, and education systems would necessarily expand to meet the needs these changes will bring. Much less oil would be imported into the province, with the money saved staying in the province. The time has come to change and get into the future, using our surplus electricity as the new energy to develop our own economy, instead of the U.S. economy at our expense.
Dennis Woodford is president of Electranix Corp.