SaskPower is announcing Monday that units 4 and 5 at the Boundary Dam Power Station will be retired in a few years, rather than receive a carbon capture and storage retrofit.
A number of factors went into not moving forward with the upgrades to the coal fired plant located near Estevan.
Environment Minister Dustin Duncan said it doesn’t make sense with today’s commodity value.
“Low natural gas prices are a significant factor in this decision. Certaintly the outlook for the coming decades are indicative that natural gas prices will remain low,” said Duncan. “The federal government has not indicated a willingness to invest a substantial capital investment as was made with BD3, so that obviously factors into the decision that has been made.”
Duncan said they may upgrade the Shand power station in Estevan, but will go through a feasibility study to make sure that’s appropriate.
The eventual retirement of the units is not anticipated to include any layoffs for the approximately 40 positions involved.
The study is being conducted by the International CCS Knowledge Centre at the University of Regina. One of the people who spoke about it Monday was Corwyn Bruce, the Head Of Technical Services. One of the early findings, he noted, in their studies thus far was the decline in cost for carbon capture and storage technology.
“As with any second generation, cost reductions are expected,” he said. “We talked earlier about having a cost reduction of 30% from this study. And what we found is that there will be significantly deeper cost reductions than 30%.”
Bruce also addressed the topic of retrofitting Shand itself.
“The 300 megawatt units at SaskPower are very amenable to carbon capture, much more amenable than Boundary Dam 4 and 5.” he said. “The retrofit of (Boundary Dam units 4 and 5) it would require the same amount of work that we did on Boundary Dam 3.”
Meanwhile, just under $1-billion ($996-million) was invested into Saskatchewan’s power grid this past fiscal year by SaskPower.
The report included investments to improve an aging power grid, while accommodating a 5.4 per-cent increase in power demand.
SaskPower also reports it is on track to meet and exceed federal emission regulations by 2030.
SaskPower continues to invest in our growing population and economy,” Minister Responsible for SaskPower Dustin Duncan said in a news release. “We need reliable, cost-effective electricity to maintain our quality of life, to keep our industries competitive and to continue job growth in Saskatchewan. We also need environmentally sustainable power and that’s why SaskPower is leading the way to cut its emissions by 40 per-cent from 2005 levels, by 2030. We continue to show that we can manage and reduce our environmental impact in an economically responsible way,” Duncan said.
“Every winter, we continue to see new peak power demand records being set,” SaskPower President and CEO Mike Marsh said. “The increase in energy use last year is the equivalent of adding 150,000 homes onto the grid. That’s why we will continue to invest approximately a billion dollars annually in updating and growing electrical infrastructure in the province,” said Marsh.
In 2017-18, SaskPower recorded a net income of $146-million, up from $56-million in 2016-17. This result was primarily due to lower natural gas prices, the significant increase in demand, and recent rate increases. This brings SaskPower’s debt ratio to 74.9 per-cent, within the company’s target range.
SaskGaming also released it’s annual report Monday.
The corporation declared revenues of $119.4-million and earned a net income of $46.4-million.
(With files from David Boles, Brandon Graziano)