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Power corporation plans to go to diesel
Waiting on Inuvik Gas reports before appealing to GNWT
Samantha Stokell
The NTPC will make the change from natural gas to diesel fuel for generation because Inuvik Gas suspects it has less than two years of natural gas remaining in its only well. Since NTPC is the anchor customer of Inuvik Gas and uses a large percentage of natural gas, it has suggested reverting to diesel to extend the life of the well. "We're working out a contingency plan right now," said Brendan Bell, chair of NTPC. "Right now we use diesel five per cent of the time per year. If we were to flip that, to use diesel 90 per cent and natural gas 10 per cent, we'd save on a lot of gas, but the ratepayers would pay more money." Before NTPC can make a decision or put the shift into action, a number of things need to happen. The power corporation needs to build a case to apply to the GNWT to approve the cost of switching back to diesel, to raise rates and to implement a backup diesel system. The first step will be to see the final report by Inuvik Gas as to how much natural gas actually exists in the well. Once NTPC receives the report, it will send it to its own analysts to confirm the opinions of Inuvik Gas' engineers and geologists. Once that is done, NTPC will have calculated the financial expenditure needed to create a backup plan in case something happens with the diesel and the generation switches back to natural gas, but that runs out, too. One option is leasing additional diesel generators. "We need to build a case for the financial management board, our stakeholders," Bell said. "We need to say 'here is the amount of money we need, here is the backup plan.'" The rates for generation will change, not only for Inuvik but for all thermal communities in the NWT. NTPC switched to a different rate system in December 2010, which lumps all groups together. With this change and expenditure, all the communities will remain in line with Yellowknife rates and the GNWT will have to pick up the excess costs, hence the need for approval before the switch. The switch to diesel is not the direction the power corporation wants to go for generation. "It's a shame not to use natural gas for home and commercial uses," Bell said. "The last thing we want across the territory is to bring back diesel generation. Our collective interest is to move away from diesel." If switching back to diesel in the short term will help Inuvik Gas determine a more solid long-term plan for natural gas, then NTPC is willing to help out. The Inuvik Gas report on how much natural gas remains in its only well should come out in the next couple of weeks. NTPC expects to make the switch to diesel before the end of October.
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