By Jesse Robichaud
As appeared on page A1
As Premier Shawn Graham urges New Brunswick to seize the economic fix offered by the growing energy appetite of the northeastern United States, critics warn the stakes – taxpayer dollars and environmental impacts – may be too high.
“There’s first mover advantage here,” Graham said Friday, stressing that New Brunswick must move quickly to carve out its niche in the market as a growing list of other provinces get in on the business of exporting energy.
Graham was in New York City last week selling New Brunswick as a source of reliable, and affordable energy for the city and the entire eastern seaboard, while in the same breath noting the province’s commitment to addressing energy conservation and greenhouse gas emissions.
“The number one concern I heard when I was in the U.S. was reliability of supply, and New Brunswick has a unique opportunity to become the energy hub of the eastern seaboard,” he said, noting the role of energy in his government’s self-sufficiency agenda.
Designs on how New Brunswick will produce the excess energy capacity are still in their infancy, including studies about adding another nuclear reactor to the province and adding a second generating station in Belledune. But what may offer a more stifling dilemma is how the province will actually transmit the energy to the customers the premier has been courting.
Ian Munro, director of research at the Atlantic Institute for Market Studies, says an aging transmission infrastructure is just one reason the mega-initiative should concern taxpayers and their wallets.
“Even though there might be a fair bit of generating capacity surrounding a city like New York, you can’t always get the energy into it, because the transmission lines might be full,” he said in an interview Thursday.
Due to the kinds of investments that may be required to provide sufficient generating and transmission capacity to make the wager worthwhile, Munro warns about the risks of investing so much taxpayer money.
“Certainly I’d rather see the private sector taking on those risks rather than taxpayers,” he said.
Graham said Friday that he is open to public-private partnerships in securing the required transmission lines and generating options.
“Transmissions will have to be addressed, and we’re starting that process now with our partners in the southern states,” said Graham.
“We’re seeing how quickly the international transmission line has been able to be constructed as a catalyst to drive this improvements in the system.”
David Coon, policy director for the Conservation Council of New Brunswick, asks whether the increasingly green-thinking region is going to want the kind of dirty energy still produced in this province, despite its nuclear, wind, and tidal energy potential.
“I think the premier’s strategy is in for a bit of a rude awakening here,” Coon said.
“That area of the world has taken on global warming as an important issue and it is bringing regulation in that will bring energy use down through conservation,” Coon said, saying the region’s thirst for energy has been overstated.
Eight states in the northeastern United States, region, including New York and Massachusetts, have signed on to the Regional Greenhouse Gas Initiative (RGGI), a legally-binding cap and trading program that begins in 2009 and requires a stabilization of emissions produced by power plants at current levels by 2015, followed by a 10% reduction in emissions between 2015 and 2020.
Coon says he expects that states participating in the initiative will eventually take action to discourage the importation of dirty energy from Canada, in order to eliminate the possibility of states using environmentally damaging loopholes to meet their own emission-reduction targets.
“No one in that system is going to want another state to escape that responsibility by simply importing dirty energy from New Brunswick.”
Tina Palmero, utility supervisor at the New York Department Public Service, was part of a working group of RGGI that was established to study the imports issue, commonly termed “leakage.” She explains that an outright ban on dirty energy coming might be difficult to arrive at due to free trade and inter-state trading agreements, but says policies are available to curb dirty imports if it is deemed they are negating the carbon reductions achieved by RGGI.
“If we’re importing more hydro from Canada, that’s not an issue. The issue is that if you’re getting more imports into the region, and those imports are coming from dirtier sources,” she said.
Palmero said emissions standards could be developed to address states like Pennsylvania, Ohio, New Jersey, and West Virginia are known for their coal burning generating stations.
Such standards would allow RGGI states to demand exporters like New Brunswick provide energy with “lower emissions standards, according to Palmero.
“It could send a signal out there that cleaner generation has more value,” said Palmero, adding that such actions would offer an economic incentive for exporters like New Brunswick to turn off their carbon producing generating stations.
Coon warns that New Brunswickers should be equally concerned about the reverse scenario of sending all of the province’s clean energy across the border and using all dirty energy to power the province.
He adds that unless New Brunswick stops producing dirty energy as cleaner sources are added to the grid, the excellent energy conservation practices of which Graham boasts will be negated by the business of exporting excess energy.
“New Brunswickers will be cutting back so the energy saved can be sent to the United States. He doesn’t seem to get that, and that’s where the contradiction lies.”