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Energy in Nunavut

Nunavut's Energy System

Overview

Nunavut is the only province or territory that has no significant primary energy production. Small renewable energy projects are emerging throughout the territory, but it is still marginal. To see some great renewable energy projects happening in Nunavut, click here. To see what type of energy is produced by provinces and territories, click here.

Nunavut relies primarily on imported fossil fuels for its energy needs. All the fuel is purchased and shipped in bulk during the short summer season and stored in tank facilities in each community. The Department of Community and Government Services (CGS), through their Petroleum Products Division (PPD), is responsible for supplying, delivering, and distributing all fuel products.

In Iqaluit and Cambridge Bay, distribution responsibilities are outsourced to private corporations, while in all other communities PPD uses local contractors.

How much fossil fuel do we use?

2016-2017, the Government of Nunavut, more specifically the Petroleum Products Division (PPD), imported 215 million liters of fuel. From this, more than 50 million liters of fuel were used only to produce electricity.

How do we produce energy in Nunavut?

Electricity in Nunavut is produced primarily through diesel combustion. The Qulliq Energy Corporation (QEC) is responsible for the generation of electricity in the territory, maintaining 25 stand-alone diesel plants in 25 communities. Each community in Nunavut has its own independent electricity generation system. There is no back-up grid.

In addition to QEC’s diesel generators, there are a few renewable energy systems that work very well in Nunavut. This includes the solar photovoltaic system on the hamlet’s Community Hall in Pond Inlet, a hybrid wind-solar system installed on the Katannilik Visitor Centre in Kimmirut, and rooftop solar panels installed on Kugluktuk recreation complex.

Other than renewable energy projects, there are many creative ways to conserve energy and reduce the amount of diesel that we use. For example, in January 2018 federal funds were granted to Qulliq Energy Corporation and the City of Iqaluit to expand the district heating system of the Aquatic Center for space and water heating. This will save more than 150 000 liters of fossil fuel per year, which corresponds to a reduction of greenhouse gas of 466 tonnes CO2/year.

The future holds considerable potential for both conventional and renewable energy resources in Nunavut. Discovered oil and gas reservoirs, for instance, are estimated to sum up to 18.25 billion barrels of technically recoverable crude oil. Nunavut also holds considerable solar photovoltaic potential as well as wind potential. The top five communities for potential commercial uses of wind resources identified by QEC are Iqaluit, Rankin Inlet, Baker Lake, Arviat, and Sanikiluaq. The hamlet of Chesterfield Inlet, for example, has a photovoltaic potential of 1158 kWh/kW per year, which is greater than such southern municipalities as Victoria, British Columbia, and St. John’s, Newfoundland.

 

Cost of Energy

As one would suspect, importing fuels into and across this vast territory is very expensive. In 2012-2013, the Government of Nunavut (through the Petroleum Products Division) imported approximately $195 million worth of fossil fuels. The purchase of fuel and all other PPD operating expenses are paid for through the Petroleum Products Revolving Fund which has an authorized limit of $200 million.

Once fuel is imported, PPD then sells to a variety of customers, either directly or through designated contractors. The main customer is the Qulliq Energy Corporation. In 2012-2013, QEC purchased approximately $42 million of fuel for electricity. Another territorial corporation, the Nunavut Housing Corporation, spent approximately $43 million on heat and electricity. Both the territorial corporations and the Government of Nunavut spend money to provide electricity and heat to government-owned buildings. In 2012-2013 the GN spent approximately $21.6 million for electricity only.

The GN supports various subsidies so that Nunavummiut can have access to the only form of energy available to them now, which is fossil fuel.  To name a few, subsidies are allocated through various programs such as the Nunavut Electricity Subsidy Program, Income Support Program (electricity and fuel), Senior Fuel Subsidy, NHC Heating Oil Tank Replacement Program, and NHC Staff Housing Programs, etc. Nunavut housing Corporation (NHC) alone provides more than $40 million dollars a year in energy subsidies.

In total, energy expenditures by the GN are estimated to be $338 million for the 2012/2013 fiscal year. Because the GN continues to rely on imported fossil fuels, these costs will likely rise with the volatile world energy markets and unforeseen supply disruptions. In 2008, For example, world energy prices spiked to more than $140 per barrel of crude oil.  As result, QEC was forced to double their fuel stabilization rates from 6.40 cents/kWh to 12.52 cents/kWh.

This reality provides many challenges for Nunavut moving forward. Energy expenditures are non-discretionary budget items, and as such, any increase in energy prices directly impacts the funding of priorities such as health, education, and housing.

 

Energy and the Environment

Most of the energy in Nunavut is provided by fossil fuels.  Fossil fuels are burned to provide the energy needed for electricity, heat, and transportation. However, when we burn those fuels, we are causing harm to the environment, particularly because it releases greenhouse gases (GHGs) such as carbon dioxide and methane in the Earth’s atmosphere.  GHGs are known to cause climate change.

More specifically, climate change is caused by the “greenhouse effect”. The Earth receives energy form the sun in the form of heat and light. Some of this energy reflects back into space and some is trapped into the Earth’s atmosphere. The Earth’s atmosphere is a layer of gas around our planet into which we find naturally occurring greenhouse gases such as water vapor and carbon dioxide. Under normal circumstances, the greenhouse gases trap some of the sun’s energy and keep the Earth’s surface at a temperature warm enough for life.

However, burning fossil fuels adds up a lot of greenhouse gases in the atmosphere. This results in more energy to be trapped into the atmosphere, which in turn warms the Earth’s surface further. This constant increase in the Earth’s temperatures creates major impacts worldwide (increasing sea levels, melting ice, change of precipitation patterns, etc.) and this is what we refer to when we talk about the climate change.

Climate change has and will continue to have profound impacts on the arctic environment. Observable changes include increased frequency of extreme weather patterns, thinner sea ice, earlier and faster sea ice break-up, changes in wildlife distribution patterns, and many, many more. All of these impacts have implications for Nunavummiut, especially those who depend on hunting and fishing for their livelihood.

Recognizing this, the Government of Nunavut is committed to reduce greenhouse gases through different agreements and strategies. In 2007, through the Council of Federation, the GN signed an agreement with all other provinces and territories to signify its intent to measure and reduce greenhouse gas emissions. Similarly, the GN’s energy strategy document, Ikummatiit, was published in 2007 to provide insights regarding the reduction of energy-related emissions, which contribute to climate change. To date, the GN has taken many steps toward this direction by completing a territory-wide GHG database to measure Nunavut’s GHG emissions, as well as reducing emissions through projects such as the Nunavut Energy Management Program.  In 2016, the Government of Nunavut reaffirmed its commitment to fight climate change by signing the Pan-Canadian Framework on Clean Growth and Climate Change (PCF). The PCF provides the framework for Canada to reduce GHG emissions, develop a growing clean economy, and to build resilience to face climate change.

The GN continues to look for opportunities in which to reduce the amount of fossil fuels we burn and decrease the amount of GHGs released into the environment.  It is true, GHG emissions have been increasing over time in Nunavut, but the GN is taking concrete actions to reduce those emissions. Individual Nunavummiut can do their part by conserving energy and ensuring that our land, water, and air are healthy for generations to come.