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Conference Board of Canada report examines electricity in remote communities


September 27, 2016
By Renée Francoeur

September 27, 2016 – Accessing reasonably priced electricity remains a challenge for over 200,000 individuals—mainly Aboriginal—living in Canada’s nearly 300 remote communities, reads a new Conference Board of Canada report, noting their electricity prices can be as much as nine times higher than the Canadian average.

“Remote communities are not connected to the main North American electricity grid and do not receive the benefits that 99% of the Canadian population take for granted, such as guaranteed, reliable and affordable electricity,” said Christopher Duschenes, director of the Centre for the North with the Conference Board of Canada. “They rely solely on locally generated electricity, which typically comes from diesel-powered generators.”

These communities cannot benefit from the economies of scale that grid-connected communities receive, the 61-page report states, using Kugaaruk, Nunavut, as an example, where the un-subsidized residential electricity rate is over 9 times as high ($1.14/kWh) as the Canadian average ($0.12/kWh). Rates such as these are often subsidized by regional governments to ensure that they are affordable, the report adds.

Additionally, the diesel generators that power most remote communities have higher operational costs than most other generation technologies, the report says, adding, “Transportation costs for diesel fuel is also high, especially for communities that lack road access. Storing large volumes of diesel over long periods of time also serves to drive up costs, as the storage facilities are expensive to purchase and maintain. Moreover, since the price of diesel fuel is strongly linked to crude oil prices, electricity costs for remote communities often fluctuate sharply.”

Options to help reduce reliance on diesel generation include use of natural gas generators, wind turbines, hydro generators and other solutions. The report nods to options that also decrease electricity usage like the use of smart meters and improving energy efficiency.

The report, Power Shift: Electricity for Canada’s Remote Communities, is available via The Conference Board of Canada’s e–Library.