Doing Away With Diesel: NWT’s Complex Power Problem

Bringing renewables online will take a strong demand from First Nation governments to determine their inherent sovereignty on their own lands – culturally and economically

by Katłįà (Catherine) Lafferty

View toward Hamlet of Tsiigehtchic - Near Inuvik - Northwest Territories | Photo credit: Adam Jones via Flickr (CC BY 2.0), cropped from original

Despite alternatives to diesel energy being desperately needed in remote communities in the NWT, they remain scarce until major challenges in the system for developing green energy projects are addressed. That includes raising a low ceiling on how much a green energy project is allowed to contribute to the grid, a finicky process for bringing those projects online, and a preference on the part of the government for larger utility-owned projects. And then there’s the bottom line – community-led green energy projects pick away at the utility’s revenue.

Growing up in the tiny community of Jean Marie River, in the Dehcho Region of the Northwest Territories, Gladys Norwegian says she and her siblings see firsthand the changes on the land. “We see it everyday here,” says Norwegian, a former Grand Chief of the Dehcho. “If you talk to any traditional Elder that is solely working with the land they will tell you that you see changes everyday.”

This past spring Jean Marie River was devastated by flooding as ice broke up along the Mackenzie River, causing it to swell over its banks, and impacting communities up and down the Dehcho Region.

Kristin Tanche, a lifelong Dene resident of the small community of Fort Simpson, Liidlii Kue (just outside of Jean Marie), was impacted by the flood. She says it brought up a lot of concern about how diesel is heating their homes and providing electricity.

“When the flood happened there were so many impacts,” Tanche says. She shares that some community members had their home heating tanks float away and spill fuel. “We had a really strong diesel smell,” she says, “and at one point during the flood we were able to come check on our house – and behind our house we saw like a sheen over the water.”

Tanche and her immediate family, including her animals, didn’t go home until about a week later when they were finally able to get rid of the fuel smell after the flood but it made her think about the impacts on the wildlife. “The flood really put it into perspective of how damaging diesel is and how reliant we are on these really dirty methods of heating our homes and (getting) power.”

The Government of Canada lists the Northwest Territories’ emissions per capita as the highest in all three northern territories, at 28.1 tonnes of carbon dioxide. That’s 43% above the Canadian average of 19.6 tonnes per capita – marking the territory as a serial emitter of carbon with nearly every community either running on diesel or using it in backup generators alongside hydroelectricity.

The sheer cost of importing fossil fuels into the territory and the incredible amount of emissions from the use of diesel to heat and power communities in the North illustrates the need for alternatives. It also means there is an extraordinary opportunity should more of the 45,000 people living in the territory shift away from greenhouse gas – and the territorial government’s own research shows a that change can and should be made.

The Government of the Northwest Territories (GNWT) is currently considering options to increase renewable energy use and further decarbonize the territory’s energy systems, explains GNWT Energy Division spokesperson Darren Campbell.

But disparate communities over a vast territory make grid infrastructure a massive challenge, and “it is important for the north to first stabilize power rates and ensure grid reliability,” Campbell says.

The cap that keeps green energy production down

Across the territory, solar arrays contribute power to the local grid – but as of July 2020, nine of the territory’s diesel-reliant communities had reached or exceeded the utility’s 20% capacity limit on renewable generation – including wind and biomass – according to a May 2021 report prepared for the territorial government on community generation. The cap means that at any given time, including in the summer when nearly 24 hours of sunlight pour into communities and onto solar arrays, diesel fuel still meets 80% of energy demands.

In theory, the capacity limit is in place to maintain stability in the system due to the intermittent nature of renewables. Non-intermittent generation, whether diesel or hydro in the grid-connected communities, has to be able to kick in where renewables might falter.

Diesel, however, is hardly exempt from safety concerns. It is considered a carcinogen by the World Health Organization, and listed by Environment Canada as containing mercury, formaldehyde, and sulphur along with dozens of chemicals known to be released in the burning of diesel.

For now, the threshold means only a fraction of the diesel used in a community can be replaced by renewable power generation – but time is of the essence. As Gladys Norwegian says “It is unbelievable the amount of fuel that’s being used and power that’s been used. Unbelievable.”

Under the Public Utilities Act, the territorial government has the authority to direct public utility companies to increase the cap, but so far it hasn’t done that.

Stability isn’t the only factor keeping the 20% renewable threshold in place. An energy department-commissioned analysis of microgrid stability with renewables, released in May 2021, found that up to 45% renewable generation could be introduced into local grids without compromising stability. However, as more and more customers go off-grid partly due to the high costs of diesel, costs increase for those still on the grid because of the smaller customer base, explains Darrell Beaulieu, CEO of Denendeh Investments Incorporated.

“The old style utilities – massive grids, transmission lines that cost billions of dollars – they’re hanging onto the status quo – and like everything else, the status quo is not working.”

This concern over the rising cost of production, should communities become independent producers, isn’t new. It was brought up in a 2010 Northwest Territories Power Corporation (NTPC) panel review, submitted to the NWT Legislative Assembly.

“We recognize that there is a political desire to enhance community self-sufficiency and lower the cost of living, but at the same time we would be negligent if we ignored the practical and economic realities of fragmentation,” the report reads. “We believe that the overall effect of select communities potentially pursuing independent power generation disconnected from the territory-wide system would be detrimental overall. Put simply, every time a piece is carved off from NTPC another part of revenue generation would be lost and costs would subsequently increase. It is our understanding that NWT residents are seeking lower costs.”

For now, the cap will continue to apply to community-based renewable projects with the exception of a power corp-owned system in Colville Lake, which uses a battery storage system along with solar, offering a backstop for the system, explains NTPC spokesperson Doug Prendergast. Colville Lake’s system “provided a high level of confidence that the community grid would be able to adapt to sudden fluctuations in solar generation given that the battery acts as a buffer to those fluctuations,” Prendergast explained in an email.

Power production tightly controlled by utility

In Old Crow, Yukon Territory, the Vuntut Gwitchin First Nation’s 900-kilowatt solar project went online this past summer, fully displacing diesel generation for the community of 250 people during the summer months – a quarter of the community’s yearly consumption.

Before the solar farm, VGFN was purchasing electricity from Atco at about 76 to 78 cents per kilowatt hour. It’s now selling power to Atco at 64 cents per kilowatt hour through an Independent Power Producer agreement. Gwitchin First Nation Chief Dana Tizya-Tramm told the Watershed Sentinel that energy sovereignty is a part of building self-sustainable and self-determining communities.

Jean Marie River saw a six-kilowatt solar system installed on its water treatment plant in 2016, alleviating the cost of powering the town’s most electricity-intensive building at $18,000 per month at the time. There is also a solar array on the band office that was installed in 2006 – but neither of the two solar projects in Jean Marie River were ever tied into NTPC’s net-metering program, which was established in 2014. That means the systems could provide power to the buildings, but would not feed back into the community grid.

The chance for First Nations to have autonomy over power generation in their own territory is limited, unless there is a strong demand from First Nation governments to have the authority to determine their inherent sovereignty on their own lands culturally and economically.

Stanley Sanguez, a former chief of Jean Marie River, said the process of reaching an agreement with the power corp. and working alongside them is a major barrier but it doesn’t need to be. “We keep telling the territorial government that there’s other jurisdictions that are doing this. How come we’re not doing as much as we need to do here?” He believes that as long as there is a negative impact on government wallets, then there won’t be change. “At the end of the day our communities are still hurting.”

Newly elected Jean Marie River Chief Noleen Hardisty said she would prefer to set up green energy projects independently rather than partnering with the power corp. but as of yet, Jean Marie’s solar arrays aren’t the only green energy projects cut off from being able to provide power to the local electricity grid. All communities, except for those partnered with the power corp. or third party-owned are not able to provide power to their local electricity grids.

Mark Heyck, executive director of the Arctic Energy Alliance and a former mayor of Yellowknife, explains that many jurisdictions have independent power producer (IPP) policies to establish a regulatory framework for bringing green energy projects to fruition that make room for smaller entities, like Indigenous-owned businesses, to produce power and sell it.

IPP’s are not new. In fact every other province and territory has a form of an IPP or Power Purchase Agreement (PPA) where communities can sell power back to the utility – except for NWT and Nunavut.

Energy Division spokesperson Darren Campbell says that while there is no independent producer policy in place, power purchase agreements allow Indigenous governments to enter into a commercial contract with the power corp. to sell power to the grid.

Yet only two of 33 NWT communities have signed a power purchase agreement with the power corp. – Lutsel K’e, for its currently-in-negotiations solar project, and Nihtat Energy Corporation in the Beaufort Delta, whose system is not yet up and running in Aklavik.

And the Government of the Northwest Territories doesn’t appear to be introducing an IPP policy any time soon.

A chance to go beyond business as usual

The territorial government’s 2030 Energy Strategy states that independent producer policies, like those in the south, are used to increase energy generation to meet demand, whereas the Northwest Territories does not need more electricity generation, only a shift away from fossil fuels.

This means the chance for First Nations to have autonomy over power generation in their own territory is limited unless there is a strong demand from First Nation governments to have the authority to determine their inherent sovereignty on their own lands culturally and economically.

Through public engagement on its 2030 Energy Strategy, the territorial government heard that communities want to play a role in ensuring a secure, affordable, and sustainable energy system in the territory.

The territory’s energy strategy has a stated target of reducing average greenhouse gas emissions in communities that generate electricity from diesel from 72,000 tonnes to 54,000 tonnes by 2030 – a 25% reduction. But it’s all business as usual, says Michael Militenberger, a former territorial environment minister and minister responsible for the power corp., now a consultant with land and environmental management firm North Raven. The power corp., he says, has always been in the business of diesel and hydro – “they’ve been very reluctant to engage significantly in renewables.”

“The reality is the world’s changing,” he says. “They just haven’t adjusted their thinking for the new reality. The old style utilities – massive grids, transmission lines that cost billions of dollars – when you can do micro-pods and you can put in all these big battery packs and solar for a fraction of the cost, they just haven’t got their thinking turned around yet and they’re hanging onto the status quo – and like everything else, the status quo is not working.”

So what’s the solution? Sanguez believes, “If we as 27 Chiefs in 33 communities of the north make enough noise, I think we all could make some movement.”

And that is finally happening. A gathering of representatives from the territorial government and Indigenous leaders from every region of the territory gathered twice in 2021 to talk about issues of common concern.

“To me this is a very big common issue; the cost of energy, the delivery of energy, the future of the Northwest Territories sustainability, carbon footprint, all those things is a huge conversation to be had about energy,” Miltenberger says. To him, this newly devised table known as the Northwest Territories Council of Leaders will be the most logical place to have a discussion with the governments about the structure of the utilities in the North.

“Should NTPC have any limits for renewables that are just arbitrary and very, very behind the times?” Miltenberger posits. “Why could we not form a corporation, now that you have this territorial table for the leaders, where there’s a utility that has multiple owners?” Miltenberger says that northerners are all shareholders of the government-owned power corp.

“The trends are clear, the numbers are clear, it’s just the systems are entrenched and they’re slow to move. The political leaders, though, can change that. They can change that tomorrow.”


Katłįà (Catherine) Lafferty is currently the inaugural climate writer in residence for West Vancouver Memorial Library. She is in her third year of the Indigenous Juris Doctor program at the University of Victoria and is working on her third novel.

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