Q&A | Yukon energy minister says power bills could go up by 53% without federal help

Minister Ted Laking was in Ottawa this week again making the case for more federal investment in infrastucture

Yukon’s energy minister doesn’t mince words when talking about the growing strain on territory’s electricity grid, and whether Yukoners should foot the bill for needed upgrade work.

“The reality is that we need to make significant investments,” said Ted Laking, the territory’s minister of energy, mines and resources.

“So significant that we believe that it is not reasonable or fair or even possible for Yukon ratepayers to take on a further increase.”

Laking was in Ottawa this week, again making his case for more federal investment in Yukon’s power infrastructure. He addressed a parliamentary committee that’s looking at affordability challenges in the North.

Laking told the committee that Yukoners could be facing another 53-per cent increase in electricity rates because of much-needed infrastructure upgrades. Demand on the grid is also expected to increase by 60 per cent over the next decade, he said.

He also argues that investing in Yukon infrastructure aligns with the federal government’s stated goals of Arctic sovereignty, developing critical minerals, and building new housing.

Laking spoke to host Dave White on CBC’s Airplay.

This interview has been edited for length and clarity.

What do you want the federal government to do?

We’d like them to partner with us similar to how we partner with them on many other infrastructure projects in the North, with a 75-25 per cent cost share, and to assist us in moving quickly on these projects so that we can ensure we have enough energy to meet the needs of Yukoners today, but also the national objectives that I referenced prior.

The point that I made to the federal government is that if you don’t step up, and you put this all onto Yukon ratepayers, that’s a 53 per cent increase. That in my view is just not reasonable or fair.

Your government is planning to build some diesel power generators as a backup, in the event that we reach a situation like we had last year — very, very cold and then really close to capacity. With the price of fuel, how big a concern is that right now?

Well, obviously with what we’ve seen in the Strait of Hormuz, the Russian invasion of Ukraine, things such as the trade war with the United States, there are a number of factors that are out of the control, of not just territorial governments, but to be fair to them, also the federal government. And so you can see these sorts of pressures increase the cost of fuel.

But that’s part of the reason why we’d like the federal government to partner with us, on ensuring that the Mayo generating facility can extend its life and be used and relied on for the long term, or to help advance the Atlin hydro project as well, which would provide eight megawatts of clean energy that we could rely on.

The ultimate goal of projects such as the White House Power Centres, which is thermal backup, is that we’d only have to rely on it during peak periods — so when the grid is really stretched to capacity. You don’t want to have to be relying on that in the summer time. And luckily, at this point in time, we still have a surplus of energy in the summer. Where we get the challenge is in December, January, February, when it’s cold and dark, when the peak periods are not periods that are conducive of things such as solar. So that’s why you need something like this, that allows you to continue to grow and to support bringing on other renewable generation.

But one of the key components is to ensure that your existing renewable generation, such as the Mayo generating facility, can continue to be utilized.

What about connecting to B.C.’s power grid? That’s a big, very expensive project. Is there any sign that that could be happening?

Well, certainly the federal government has given us some money through pre-feasibility work on that.

But the one thing that I would just want to ensure that Yukoners understand is that, while that is a promising project for the future, it’s not realistic for the short or medium term. We’re talking about a very complicated project, over hundreds of kilometres of untouched wilderness, to extend the power line to connect to the B.C. grid, that goes over many traditional territories.

That’s not to say that you don’t continue to do the pre-feasibility work to ensure that you are ready to go if and when the funding partner were to come forward. But to put it in perspective, the latest cost estimate that we had from early this year was over $4 billion. The annual budget of the territorial government is $2 billion. So we’re talking about that latest public cost estimate was over double our annual budget. That’s beyond the means of the territorial government. There’s nobody that I’m aware of that’s stepping up to fund something like that at this point in time.

Here we are in October, staring down the barrel of another Yukon winter. What’s in place to try to help us manage, you know, the next six months?

After the scenario in December where we were close to rolling blackouts in the City of Whitehorse, we undertook a number of actions in the short term to help facilitate the stabilization of the grid and to help buy us time while we get on at least one phase of the White House Power Centres [project], which should be a 15 megawatts of additional energy.

So that work included repealing the Clean Energy Act, which had really been facilitating increased demand on the grid through the electrification of of homes and transportation. We also reallocated rebates from electric vehicles toward homeowner rebates to allow for expanded energy efficiency within your home, to allow for people to bring on things such as heat pumps or wood heating to help supplement or take demand off of the grid.

We’ve also been working with partners through the Yukon, including the City of Whitehorse, to identify further ways that we could expand a program that we, and the utilities and the municipalities, work on to identify major buildings that do have the capacity for self-generation — so that they could be taken off the grid if we did get to a point where we were running out of energy. That really would buy you time and prevent you from having to do things such as rolling blackouts.

So we’re doing a lot of work. We know that at this point in time that that’s not the silver bullet to solve all of our energy woes, but it helps get us to the next phase of the White House Power Centres.

How do you feel when the federal government says they’re going to increase the military presence in the North, they’re going to do this, they’re going to do that. And there you are saying, well, you better bring your checkbook if you’re going to do that because we’re going to need to upgrade our power. Do you feel like some of those plans are not as fully thought out as they should have been?

I think that when you’re dealing with the country as large as Canada, it’s really important to do trips like the one that I’m on right now, which gets you to Ottawa and and gets you in front of ministers. I’ve been doing this about once a month now since March, meeting with federal ministers, meeting with counterparts, meeting with deputy ministers, and putting this on their radar. What we’ve noticed through that work is just significantly improved better understanding of the challenges of the territory. To me that’s promising.

Once you recognize the problem, it’s easier to solve it. The big question will be, are we successful at getting the federal government to understand they need to be a funding partner as well?

Related stories from around the North: 

Canada: N.W.T. finance minister says no emergency relief from fuel price shock, but pushes Ottawa for support, CBC News

Russia: As gasoline crisis worsens, Russia boosts fuel imports through Murmansk, The Independent Barents Observer