Groundwater Studies at Marsh Lake | Monday, September 28, 2009

Yukon Energy is planning to do some groundwater studies starting this month at Marsh Lake. This is part of our on-going work to gain as much information as possible about the Southern Lakes system. To our knowledge, there has never before been a groundwater study done in the Marsh Lake area. We feel this information will be valuable both to Yukon Energy and to Marsh Lake property owners.

The studies will involve installing nine piezometers at Army Beach. The equipment will provide information about how the lake levels affect groundwater levels in the area. 
If you see this equipment, please leave it undisturbed (see photo below of what the piezometers look like).
We will monitor groundwater levels throughout a full year, after which time we will share the findings with local residents.

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Sorting Through Regulatory Terms | Friday, September 18, 2009

Yesterday we promised to try to explain the difference between a rate application/revenue requirement hearing and a Cost of Service study. A revenue requirement hearing, which Yukon Energy has just gone through and which the Yukon Utilities Board (YUB) has just ruled on, allows the YUB to review all our costs to determine if we are operating in a reasonable and fiscally responsible manner. It also gives the Board the chance to decide how much money we need to operate and what the over-all amount is that we can charge our customers for the service we provide. 

A Cost of Service study, which will be part of an upcoming Phase 2 hearing, takes the YUB-approved costs of both utilities that operate in the territory (Yukon Energy and Yukon Electrical Company Ltd.) and decides how much of that total amount should be paid by each class of customer (i.e. residential, commercial, government, etc.).

The last time a full Cost of Service study was done was in 1996/97. At that time, the Utilities Board divided up the costs this way:

  • Residential customers were asked to pay 80 percent of the actual cost. There was also a rate relief program in place - a pre-cursor to the existing rate subsidy. Once that was factored in, residential customers actually only paid 73 percent of the true cost of electricity.
  • Small businesses received a large rate decrease to bring them down to 110 percent of the actual cost. Before the decrease they were paying 132 percent.
  • And government general service (i.e. government buildings) got a small decrease which meant they went from 154 percent down to 143 percent.
  • The rest of the classes, like streetlights, were all in the 90 to 110 percent range.

These numbers still apply today, and will continue to apply until they are changed by the Yukon Utilities Board.

There is one point worth noting. An Order in Council is currently in place that prevents the YUB from making changes to the amounts each class pays in relation to all the other classes. In other words, it prevents raising the rates of any one class so as to lower them for another. The OIC is in place until the end of 2012. So unless the Yukon government amends this order, a Cost of Service study can’t result in any changes between classes until at least 2013.

A Phase 2 hearing, however, can deal with more than just rebalancing of customer classes. For example, the Yukon Utilities Board has indicated it will use the upcoming Phase 2 hearing to look at our proposal to lower 'first block' customers (those using 1,000 kilowatt hours or less of electricity a month) and increase 'second block customers' (those using more than 1,000 kilowatt hours per month). Note that these customers are all in the same class, so there would be no class rebalancing involved.

Another Phase 2 issue is a review of the Electrical Service Regulations. These are the terms and conditions under which both Yukon utilities provide service to customers. The regulations cover everything from rights of land access (such as when a linesperson has to go on your property to access our transmission lines) to service fees to the maximum the utilities will invest to hook up a new customer.

 
 

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Yukon Utilities Board Latest Ruling Explained | Thursday, September 17, 2009

You may be aware that the Yukon Utilities Board (YUB) recently handed down its decision regarding our rate application we submitted last October.

In the application, we asked that – in the interests of promoting energy conservation – rates for those residential customers using 1,000 kilowatt hours or less per month be decreased by 17.8 percent. Those customers using more than 1,000 kilowatt hours would see a slight increase in rates under our proposal. While the YUB considered our request, it implemented an interim rate reduction for all firm customers except the Minto mine of 3.48 percent.
In its ruling earlier this month, the Utilities Board decided to put off making a decision about our request for rate reductions for ‘first block’ customers until both electrical utilities in the Yukon file a Cost of Service study. Tomorrow on this blog we will explain the difference between a rate application and a Cost of Service application. But the bottom line for you is that you should not expect to see any changes in your power rates, at least until the YUB has made a decision regarding the Cost of Study application. We expect that application will be filed in the next few months.
However the YUB did make a number of other decisions regarding our application. It has determined that almost all our costs can be put into rate base (meaning passed on to you, the customer). This indicates to us that the Utilities Board feels we are being responsible with your money. The one cost that the Board did not allow was the $3.19 million for some diesel generators we purchased from the Minto mine. It said we had not adequately demonstrated the need for the diesels at this time. The YUB did say however that we could apply again to have those costs put into rates at a future date.
With regard to the Carmacks-Stewart Transmission Project, the YUB said it was convinced that this new transmission line provides a net economic benefit to Yukoners.
As to deferred costs (spending money on planning for future generation projects), the Board said that Yukon Energy doesn’t have the luxury of waiting for new energy loads to materialize with full certainty before planning and building facilities needed to meet growing electrical demand. It supported our on-going work to have projects ‘shelf ready’ so they are ready to proceed at some future date as circumstances warrant.
Other points included in the Utilities Board Order:
·         Yukon Energy and Yukon Electrical Company Ltd. are to submit a joint policy paper/plan for Demand Side Management strategies (energy conservation strategies).
·         Yukon Energy is to do a study in brushing programs (clearing brush from near power lines) in other jurisdictions and provide our own brushing policy.
·         Both utilities must provide the Board with Key Performance Indicators that show improvements in reliability.
·         Yukon Energy is to continue with its work of refurbishing our oldest diesel units (Mirrlees), which will provide back-up power when needed.
·         Yukon Energy is allowed a profit of 8.64 percent for 2008 and 8.49 percent for 2009.

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Last Night’s Outage | Tuesday, September 15, 2009

There was a brief power outage last night that affected Riverdale, Grainger, most of Copper Ridge, and areas south of Whitehorse including Tagish, Marsh Lake and Carcross. Power went out at 11:13 p.m. and was restored to everyone within 25 minutes. Some areas had their electricity back on within 13 minutes.

The outage occurred as we were making changes to our system to accommodate the new third hydro turbine that will be installed at our Aishihik plant within the next year. We lost stability on the system and two of our Whithorse  hydro units went down. The problem has been resolved and all units are now functioning properly. We apologize to all those who were affected by the outage.

 

» 3 Comments     » Topics: Reliability

An Update on Some of Our Major Projects | Friday, September 11, 2009

It is proving to be a busy fall at Yukon Energy, as we continue to work towards getting all permissions in place to move forward with the Mayo B project. Groundwork is also about to begin on Stage 2 of the Carmacks-Stewart Transmission Line. We invite you to read our latest newsletter to get the most up to date information regarding both of these projects.

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Some Myths Regarding Wind Versus Hydro Power | Thursday, September 3, 2009

Yukon Energy has received some criticism recently for wanting to proceed with our Mayo B project. The essence of the argument is that wind is a much cheaper alternative to Mayo B, and therefore should be pursued instead of the Mayo B project. The calculations in a recent issue of the Yukon News are based on Mayo B costing $142 million, which is incorrect. Mayo B is actually projected to cost $120 million, with an additional $40 million going to complete the Carmacks-Stewart transmission line.

Incorrect numbers aside however, from Yukon Energy’s point of view wind and hydro do not present an either/or argument, since we are exploring both. Over the next several years we will need to find new clean, renewable energy from as many different sources as possible, and this may include both wind and hydro. Wind is an option that will be assessed along with all other new renewable options. However before we pursue brand new energy projects, we have committed to making the most of our existing assets.
Mayo B is one such initiative; it enhances our current Mayo facility and does not require any new dams to be built. As such, it has a smaller environmental footprint compared to any new ‘greenfield’ projects.
While we are looking at wind as potential new power, it does present some challenges. The newspaper article states that wind has an efficiency rate of only 30 percent. Using that number, the columnist argues that building 17 wind turbines of one megawatt each would produce the same amount of energy as Mayo B at half the cost. In fact Yukon Energy’s existing wind turbines are only about 15 percent efficient. Using the columnist's scenario and calculations, we would need 34 turbines to meet Mayo B’s capacity, making such a wind project equal in capital cost to Mayo B. And while this number of wind generators may give the same amount of energy, it doesn’t necessarily provide that energy when it’s needed. Wind turbines will only work when there is sufficient wind, a fact that’s true whether there are two turbines or 200. Even if our turbines did run at 30 percent efficiency, that means 70 percent of the time we would be forced to burn diesel at a very costly 30 cents per kilowatt hour, resulting in higher electricity rates for Yukoners and more GHG emissions.
Added to that is the fact that wind generation equipment does not last as long as hydro equipment. The existing Mayo facility was built in the mid-1950s and is still going strong. A wind turbine’s life expectancy is 20 to 25 years. Factoring in the replacement cost of the turbines, the cost of the wind energy project proposed (using the newspaper's calculations but based on 34 turbines) would be about double that of Mayo B.  
The Yukon’s harsh climate is hard on wind turbines, and because of their remote location, maintenance can be difficult. In winter, when we need power the most, it is often unsafe for staff to repair the equipment. In addition, the turbines are susceptible to rime icing, which greatly reduces their ability to produce electricity. We often encounter rime icing problems in the winter, so just when we need the energy the most, it is not available to us.
All that being said, Yukon Energy is not ready to give up on wind. We continue doing research to see if wind energy can be a viable source of electricity in the territory.
On a final note, it is important for Yukoners to understand that the $71 million promised by Ottawa is specifically for Mayo B and the Carmacks-Stewart Transmission Line Phase 2. There is no provision for us to use this money for other projects, including wind. If we don’t use the money for these two strategic projects that will benefit the vast majority of Yukoners, we lose it. Yukon Energy feels that to allow $71 million in infrastructure money to slip through the Yukon’s fingers would be highly irresponsible.
 

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Last Chance | Thursday, September 3, 2009

A reminder that you only have a few days left to visit the Whitehorse Rapids Fishladder. The last day the facility is open to the public is this coming Sunday (September 6). It will then be closed until next June.

We'd like to thank everyone who's taken the time to come to the fishladder this season. If you have suggestions for ways we could improve the facility, we would love to hear from you.

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Last One of the Year | Tuesday, September 1, 2009

Here is the final chart of the season for Marsh Lake water levels. The level has just about peaked and will start to recede over the next couple of weeks. Please let us know if you have questions about this chart.

We will resume providing regular water level charts in June 2010.

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