In the race to build a lot of clean power to displace fossil fuels from the electrical grid, there is an array of competing demands for all the new juice: EVs, home heating, data centres, AI, crypto, LNG and hydrogen.
It has never been easy, or inexpensive, to plan and expand power grids. The challenges today and in the years ahead are acute, building more quickly than ever before to reduce greenhouse gas emissions and to electrify large parts of the economy, such as transportation.
The first goal for clean power must be cutting out fossil fuels from the grid. Electricity with as few emissions as possible is the keystone strategy to reach net zero across the economy by 2050.
That aim is entwined with the next step: reducing fossil fuels in transport, home heating and other areas of the economy. Here is an important reminder: It is obvious to point at the oil sands but emissions from the entire oil sands are the same as those from passenger transportation and also from buildings. Each of three represent about one-eighth of Canada’s total.
As the demand for power surges, however, governments face difficult decisions. Let us start with electric vehicles. Skeptics of EVs have been quick to blame them when grids face moments of stress under the load of heavy demand.
But a recent analysis in Alberta, from University of Calgary professor Blake Shaffer, showed that adding one million EVs to the provincial grid – replacing one-third of the vehicles on the province’s roads – would represent only a 3.5-per-cent increase in total demand. A separate study in Alberta showed that lower rates to charge EVs during off-peak hours can be strongly effective.
Further, as EV and grid technology develop, some EVs serving as batteries could supply, not draw, power during high grid demand. These factors suggest that a fleet of a million EVs in Alberta could contribute to the grid during moments when it is most strained.
Now, let’s turn to something of the opposite, a power-hungry source with little discernible societal value: so-calling mining for cryptocurrencies.
Provinces such as Quebec, Manitoba and New Brunswick have limited or flat-out said no to crypto. British Columbia has joined them. In late 2022, B.C. paused new grid connections for crypto, facing power requests of greater than two Site C dams (a $16-billion, 1,100-megawatt project). This spring, B.C. passed legislation that allows the government to prohibit such connections.
Crypto sucks up a lot of power – but so do data centres (think of Netflix and all your pictures in the cloud). Now, think of AI. Data centres and AI make a lot more sense as broadly worthwhile for the economy, but the reality is their power demands are dizzying. At extremes, such as in Ireland, data centres in 2022 consumed almost one-fifth of the country’s power. That’s in part because of companies such as Google. AI will only intensify this. The investment bank Goldman Sachs in May predicted data centres and AI could account for 3.5 per cent of worldwide power usage by 2030, up from about 1.5 per cent today. There is promise in improved efficiency. Data centres and AI can be better designed, a recent Globe feature showed, to do more with less power.
The list of demands goes on. Turn attention to green hydrogen, a clean fuel, yet its potential power needs are extreme. A proposed $2-billion project in B.C. would require almost all of the Site C dam’s output. This puts the choices governments will have to make in sharp relief. In this case, it seems to make little sense, given competing demands.
Liquefied natural gas is another challenge. B.C. wants to slash emissions from LNG, and the upstart Cedar LNG project will be electrified, requiring power equivalent to about one-sixth of Site C’s output. That’s modest compared with Royal Dutch Shell’s LNG Canada near Kitimat, B.C., whose potential expansion would double the project’s export volume but would also suck up well more than half the power of Site C, along with $3-billion of new transmission.
Doubling the size of LNG Canada would mean as much as 20 per cent of the country’s total methane gas production could be exported by sea – but electrifying the expansion could come at an upfront cost to publicly owned BC Hydro.
Expanding the power grid has always been difficult. It is more so than ever – an effort complicated by the challenge of how and where to allocate electrical resources.