Canada pledges $11 million for Indigenous clean energy

In a big step toward a sustainable future, First Nations and Inuit communities across Canada will get federal funding to transition from diesel to clean energy solutions. But experts say the journey ahead is tough, from building necessary infrastructure to ongoing support and long-term maintenance.

The federal government has announced $11 million for projects in 15 Indigenous communities. The initiative, under the Clean Energy for Rural and Remote Communities (CERRC) program, aims to improve energy security and economic development while reducing diesel reliance.

The funding will support projects in six provinces and territories: Nunavut, the Northwest Territories, Ontario, British Columbia, Saskatchewan and Quebec. The projects include wood pellet-burning power systems, solar energy and efficiency upgrades to reduce energy costs.

As of 2020, diesel-reliant communities in Canada consume approximately 682 million litres of diesel per year. Diesel engines also produce up to 100 times more particulate matter than gasoline engines, and create pollution that harms the environment and public health. 

As a result of the high cost of diesel, residents in remote areas also pay six to 10 times more for energy than the rest of Canada, despite $300 to $400 million in annual government subsidies for diesel transport and use. 

Over the past decade, funding programs, like the Renewable Energy for Remote Communities Program and Northern REACHE, have advanced clean energy projects in remote communities. Experts and researchers see this as a good start but say more funding and ongoing support is needed for long-term success.

“It’s great to get started but a whole lot more investment is going to be required … to support northern and remote jurisdictions to meet the needs they have,” said Lynne Couves, director of the Pembina Institute’s renewables in remote communities program.

Money alone won’t solve the challenges. The biggest impediment is the transition itself, from one energy source to another, experts say.

“Renewable energy, when done properly, can be a huge benefit to these communities but we’d be kidding if we said there weren’t risks and injustices involved,” said Dr. Nick Mercer, an expert in Indigenous clean energy initiatives and community-based energy planning, and assistant professor at the University of Prince Edward Island.

Many Indigenous communities are not fully on board with renewable alternatives, despite the availability of funding from government initiatives like the Indigenous Off-Diesel Initiative, Mercer has found during discussions with affected people. Diesel dependence is deeply ingrained, he added. “It’s not like it’s their favourite thing in the world — but there’s a reluctant acceptance and support.”

Diesel has been the primary source of energy in remote areas for decades because of its reliability and portability. It has major drawbacks, particularly the generation of air pollution and noise, its cost, frequency of harmful spills and refuelling challenges in remote places.

But it is reliable. A fuelled and well-maintained generator can be expected to generate the same amount of power, all day and night. While renewable energy has environmental benefits, its variability — especially with solar and wind — is a problem for communities used to diesel’s consistency.

Switching from diesel to clean energy, while necessary, is not instantaneous.

Even with government support, the actual operational phase is when things get tough. Couves says this is often overlooked in the broader energy transition conversation.

Project timelines in remote areas are drawn out, especially in areas where logistics play a big role. "Transportation of materials to these communities is heavily dependent on seasonal conditions," she said. In some cases, shipping depends on ice roads that are open just a few weeks a year; in other cases, ships that deliver materials come just once or twice a summer.

The seasonal constraint means projects can take several years to complete and delays are inevitable. "In the south of the country, renewables can develop really fast ... but in remote communities it takes longer," she added.

James Jenkins, executive director of Indigenous Clean Energy and a member of Walpole Island First Nation, says Natural Resources Canada has ramped up in recent years to ensure community-led initiatives are at the centre of the funding process.

The CERRC program, launched in 2018, has supported over 190 projects across the country, with an additional $233 million allocated through the 2021 federal budget. Wah-ila-toos, an Indigenous Council of six leaders from First Nations, Inuit, and Métis, advises federal departments to improve access to clean energy initiatives for Indigenous, rural, and remote communities. 

"Community-led projects are key to building long-term resilience and prosperity within Indigenous communities," said Natural Resources Minister Jonathan Wilkinson in a press release. "Clean energy will lead to economic empowerment, better health and lower energy costs for households."

Indigenous communities also face barriers when it comes to accessing federal funding for building efficiency. While technologies, like heat pumps and high-efficiency wood stoves, can reduce diesel use, they don't always align with current funding structures.

“Building efficiency is a component of [reducing diesel use] but the grants aren’t usually set up that way,” Jenkins said. 

For many Indigenous communities grappling with pressing challenges in healthcare, education and housing, investing in renewable energy infrastructure can feel like a less valuable trade-off.

The high upfront costs of renewable energy infrastructure, like wind farms or solar installations, creates a financial barrier. Some communities end up taking on the financial risk which can put undue pressure on local resources. “What we’ve seen in some cases [is] … the community goes forward and ends up taking on some of the risk because the regulator is concerned about recouping the capital cost,” Jenkins said. 

For many Indigenous communities, sovereignty and control over energy systems is as important as the financial and environmental benefits of the project. “What tends to bring a lot of pride to these communities around their clean energy systems is that they do have control,” Couves said. It’s not just about cost savings or reducing diesel dependency — it’s about empowerment, local control and making sure these communities are not at the mercy of external forces.

“We need to increase community capacity and understanding of their energy systems in order to have true energy security and true sovereignty in these communities with their energy systems,” she said.

Instead of money leaking out to external energy providers, communities can generate income from renewable energy projects and reinvest in their own priorities.

“We need to make sure a community is not just a passive recipient of a renewable energy project, but an active host and active leader of a renewable energy project,” Mercer said.

Sonal Gupta / Local Journalism Initiative / Canada’s National Observer