The inability of Canadians to look beyond parochial interests is stymying the development of a national grid that would provide economic, environmental and social dividends for generations.
Reams of scientific, economic and technical data inform us that Canada needs to help build an improved continental power grid with our American neighbours to avert the worst impacts of climate change, and to collectively show real public policy and commercial leadership on the international stage.
This “supergrid” would be an economic force multiplier for Canada, creating hundreds of thousands of jobs and ensuring our energy security in a troubled world. Of course, expanding the grid will also help decarbonize our society, powering our homes, cars and businesses and generating spinoff effects like improved local air quality and community health outcomes.
Yet, provincial authorities lack the mandate to even take the first elemental steps of technical planning in co-operation with our neighbours to the south. This is the heartbreaking “tragedy of the commons” playing out in slow motion in our national electricity sector.
A Harvard Business School blog defines the tragedy of the commons as follows:
“This theory explains individuals’ tendency to make the best decisions for their personal situation, regardless of the negative impact they may have on others. An individual’s belief that others won’t act in the best interest of the group can lead them to justify their selfish behaviour. When facing the use or potential overuse of a common or public good, individuals may act with their short-term best interest in mind, for instance, using an unsustainable product, and disregard the harm it could cause to the environment or general public.”
In the case of our balkanized national grid, the tragedy is more often not the overuse but the underuse of the grid. Most Canadians are unaware that we are electrically connected from St. John’s to Victoria. Yet these “intertie” or large transmission projects which interconnect different service areas, are relatively small and oftentimes underutilized. Most provinces are much better connected to their American neighbours than to neighbouring provinces. Moreover, we lack a true marketplace for the trade of our electrons, instead using a mercantilist system of inefficient tariffs.
Under our Constitution, provinces duly control most major levers of grid development. Politicians rightly see grid development as a major area for economic development, yet they often miss the forest for the trees, allowing narrow provincial utility interests to override the requirement to develop what technical planners call an “interregional” approach to infrastructure development. This approach would build transmission to allow a massive deployment of renewables, on a scale that no provincial utility can possibly marshal by itself, lowering costs and risks to ratepayers as we head into the energy transition.
Take, for example, Alberta. Local generators there believe greater transmission connections with neighbouring British Columbia will allow BC Hydro to trounce their local power market. In fact, both provinces need to “grow the electric pie” to serve all the new power demand that will come online in the ensuing decades.
BC Hydro simply doesn’t have enough generating capacity to greatly disrupt Alberta’s market. Deeper linkages between the provinces would lower power costs for all consumers across the region, allowing for a freer trade of electrons and lessening the footprint from new developments. A smart deal between the provinces would not only see Alberta generators get greater access to the B.C. market, but also the ability to transfer electrons through B.C. into the U.S.
B.C.’s electrons could conversely pass through Alberta to Saskatchewan when needed. This would be a win-win for the region and spark billions in new investment in wind, solar, storage, geothermal, hydropower and small modular reactor projects. Yet, such a step change requires real leadership, a growth mindset and the elimination of protectionist tendencies.
Following a generation of massive buildout after the Second World War, the grid has only been mildly tweaked in most provinces over the last 30 to 40 years. To move away from this incrementalism, we need to conduct technical planning, giving regulators, provincial officials, utilities and project developers the right mandates and incentives to bring investment and solutions to the table.
For interprovincial transmission where no single authority has full control, competitive processes involving the input of communities, industry, Indigenous groups, civil society, technical firms and project developers should play a role in ensuring a deliberative, transparent process that goes beyond the interests of any one provincial utility.
Oh, and by the way – to mark Earth Day, the U.S. Federal Energy Regulatory Commission launched a new interregional planning and development process for transmission that will see the U.S. vault ahead of Canada unless we unify on these matters and step up to the negotiating table as the collaborative, honest brokers we pride ourselves to be. A failure to do so will keep us reliving the tragedy of the commons on our power grid well into the future.
Philip Duguay is an infrastructure developer and public policy analyst with over a decade of experience working across Canada and the United States. Prior to originating a $2-billion transmission project in partnership with a Canadian institutional investor and an Indigenous government, Duguay held strategic advisory roles for the governments of Quebec and the Northwest Territories.
Comments
This is a crucially important article. It holds the key to the as yet unrealized widespread success of renewables and decarbonization. What isn't explored as fully as it should be is the necessary involvement of the federal government.
There are four central reasons for the lack of federal interest. A hesitancy to invest public funds and manage projects directly instead of offering limited tax incentives to private parties. Fear of provincial government reaction to their individual electrical grid fiefdoms. Fear of and a lack of knowledge about how manage provincial court challenges to federal project hegemony at the national scale. Lack of imagination on fostering a 21st Century industrial and knowledge-based economy.
The Trudeau government has not assumed leadership on building infrastructure for renewables, despite their rhetoric. They are followers of rather weak climate policy trends. We have incremental and small-scale funding for public transit and very late coming direct grants for the electrification of private road transport, home and building energy improvements. They prefer to stay out of provincial electricity grids and don't care to promote building any number of green industries.
Meanwhile, they have approved new petroleum projects despite direct and very strong warnings by the IPCC and the IEA about doing just that, and assumed sole ownership of the unaffordable golden pipe known as TMX which crosses provincial boundaries "in the national interest," offered fossil fuel companies huge tax breaks for carbon capture, utilization and sequestration (CCUS) with questionable efficacy, and are loath to address private corporate coal shipments through Ports Canada jurisdiction from both Canada and the US. This unfortunately includes egregiously problematic thermal coal along with currently essential metallurgical coal.
Here's an outline for electrification.
- Buy up land for a national smart electricity corridor network. An average corridor needn't be more than 200-300 m wide and could, if designed right, parallel existing transportation and transmission corridors. New electrified passenger and freight rail infrastructure can be accommodated in the corridors.
- String the corridor with high voltage direct current cables and sprinkle it generously with inter-connection points containing AC-DC inversion facilities along provincial and international boundaries and at points where it could join with provincial and urban grids, and where farmers, private renewable power companies and First Nations can send their rural solar and wind power. Offer incentives for private renewable power projects to join up with the grid.
- Apply as much flexibility to the grid as necessary to send power across the country in milliseconds and to trade / buy / sell power at reasonable rates that take advantage of the time zones. Offer the US a friendly contract to provide exported zero emission power at a reasonable price on demand to several inter-connection points. Monitor the positive impact of power sharing co-operation on individual provincial maintenance, depreciation and replacement cost projections.
- Build hundreds of battery storage farms along the entire corridor focusing on avoiding lithium and other rare resources and materials in favour of local supply. Iron-air, liquid metal and other flow batteries, as well as super capacitors and thermal storage in graphite (etc.) could all be field tested in situ with a focus on the feds holding partial patent rights with private companies in exchange for large-scale distribution and direct investments. It is likely that a smaller number of storage technologies will evolve, be perfected and then mass produced at low cost for worldwide export.
- Promote access to the corridor as an advantage for new green industries, such as green steel, low emission cement, manufacturing and conducting deep research into green tech through university-oriented 'brain hubs' with a protective legal dome over related innovation breakthroughs and developments in intellectual property patents. A federal presence will help prevent new technology from being bought up by foreign interests. Oil and gas are distinctly stone age by comparison.
- Encourage all provinces and territories to adopt standardized, long-term net metering credit policies to make it possible for homeowners, First Nations and farmers across the nation to purchase solar panels at the smaller scale and make their own contribution to climate action and break their dependence on carbon fuels. If a province does not co-operate with reasonable net metering policies, then the feds could offer them to individuals within a fairly close proximity of the corridor via branch transmission lines.
- Any court challenge by a province would quickly run head-on into the results of the Supreme Court of Canada case where BC challenged TMX and lost. The feds won the case based on the constitutional power over sole jurisdiction and legal ability to cross provincial boundaries with infrastructure "in the national interest." It also confirmed sole federal ownership of the contents of the pipe, even toxic diluted bitumen that was never given the benefit of a professional risk assessment, especially in marine environments. That was a disappointment, but also an illuminating precedence for building infrastructure for clean electricity, both the physical and energy products falling under exclusive federal ownership.
To illustrate the power (pun intended) of scaled-up electrical connectivity, if the feds offered inter-ties and reasonable purchase agreements with wind and solar farms owned by adjacent farmers and First Nations within, say, a 5-km wide swath of land on either side of the battery storage-enhanced corridor (10 km width), that brings 30,000 square km of windblown and sunlit land into play in a 3,000 km section of corridor. Raised solar panel arrays and conventional wind turbine placement practices will still accommodate farming activity, preferably regenerative agriculture.
What's not to like about farmers and First Nations earning additional revenue from renewables while enjoying higher yields from RA? Or urban residents enjoying solar panels that will pay for themselves before the warranty expires? Or provinces enjoying the profits from large scale exports of clean power to the US and Mexico?
Why, after 6 months, is this comment [still] buried here? It should be a headline article.