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SOMBA K'E/YELLOWKNIFE
The Con Mine geothermal project promises to be a point of contention between the mayoral candidates as challenger Tim Doyle predicts it will be "absolutely dead in the water" if he is elected.

Paul Falvo: Supports project but is concerned about costs. Tim Doyle: Says geothermal will be dead if he's elected mayor. Mark Heyck: City still negotiating with building owners. Geothermal timeline March 14, 2011 - Referendum to borrow $49 million defeated by the voters, 1,362 to 997. June 2011 - City signs memorandum of understanding with private partner Corix Utilities Dec. 12, 2011 - City council forms a utility "to act as the city's agent" with private investor Corix Utilities in order to ensure services are delivered to the public. The city will "operate the community energy system, maintain the direct relationship with customers, and control rate setting." April 19, 2012 - Belgian firm Vito Vision on Technology reports from previous summer study that underground chambers at Con Mine can be used viable heat source. Source: City of Yellowknife

"People voted no on it, they didn't vote maybe or let's look at it again," said Doyle of the city's defeated request to borrow up to $49 million in a referendum last year. "So let's respect what the voters say and kill the project."

Doyle said he doesn't think the city has done its homework properly on the viability of Con Mine as an alternative heat source and continuing to spend more public money shows a lack of respect for taxpayers.

"I'm not sure why the people in power, including my competition, are ignoring the public who voted in a referendum," said Doyle. "What are the consequences of ignoring a legally binding referendum?"

Currently administration is trying to finalized a deal with private partner B.C.-based Corix Utilities, and build a customer base for the downtown energy system project by getting downtown landowners on board with it.

Both Mark Heyck and Paul Falvo, who supported Con Mine geothermal and a downtown district energy system as city councillors, say they still support the project and are content with where things are right now. Both say whatever comes from city discussions with downtown building owners will largely determine how soon the city will go ahead with a geothermal and/or biomass heating plant for downtown.

"The conditions I supported on it previously are still there," said Heyck. "Number one, you have to have your customer base and that is what we have been trying to establish for the last several months.

"It is a matter of making the case to those folks that this is a worthwhile project. It is a bit of a chicken and an egg situation there because the customers want to know what the rates are going to be."

Heyck said it is hard to predict what the immediate future might hold for the project as a number of variables are in play, including the establishment of new goals and objectives by the city council that gets elected Oct. 15, and to what extent federal and GNWT funding will be available. A $14-million Natural Resources Canada grant to fund the geothermal portion of the project is still in play, which Heyck said will greatly impact what rates will be charged for district energy and how much capital costs tied to the system will be.

Falvo similarly backs the project but stresses that he is concerned about how much the overall costs will be.

"I am supportive of it but it has to be cost effective and we have to make sure we have the buyers for it," he said.

"We have to make sure we have the landlords and the GNWT are behind it. If we don't have that then it might not be the time to do it. But I think it is eventually going to happen."

Doyle said he's skeptical of the city's negotiations with downtown landlords, saying those he has spoken to don't support the district energy plan.

"I have talked to downtown building owners and they have said they were not buying into the process because it was faulty and did not include all the costs that were going to to be passed on to building owners," said Doyle.

He said a building owner complained to him that costs for breaking up sidewalks and digging a tunnel into a building's basement to connect it to the central heating system were not being factored in.

"He said the cost was going to come to him when a block of cement is $5,000 each."

District energy discussions have been quiet since April when Belgium-based energy company Vito Vision on Technology reported to the city that Con Mine had a capability to provide the required amount of heat. Mayor Gord Van Tighem said at the time figures showed that the mine could provide half of the amount of heat needed for the downtown buildings. The other half would come from biomass.

The city's 2011 financial statement reports that $787,577 was spent toward work relating to the Con Mine project during that year. According to the city, $218,515 came from the federal government, $89,000 from the Department of Environment and Natural Resources, and $250,000 from the city's annual community energy planning fund of $500,000, which comes from the GNWT through its formula financial contribution.

Of the $229,810 remaining, $105,571 went to the salary and benefits of former energy co-ordinator Mark Henry, and $124,239 went to other community energy projects, ventilation and air conditioning systems, greenhouse gas emissions monitoring and inventory, and an eco-chill system at the Multiplex arena.

The federal government's CanNor agency contributed its second installment of $90,000 to support development of a yet to be constructed centralized heating plant for the fiscal year 2012-13.

The city insists no municipal taxes have been spent on the district energy system.

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