Overview of Electricity Sector

The electricity grid in Yukon, much like in the other two territories, is quite unique compared to the rest of Canada, largely because of its small size and isolation from the North American electricity and natural gas grids. Yukon. The vast majority of Yukon’s electricity (94.7%) is supplied by hydroelectric facilities followed by diesel at 5.2% and a small amount wind power [i]. Yukon’s sizeable diesel capacity serves mostly as a source of backup power in more populated places like Whitehorse, and as the sole source of power in many remote communities [ii]. Yukon Energy Corporation (YEC), a Canadian Crown corporation and subsidiary of Yukon Development Corporation, own and operates most of the territory’s grid [iii].

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Like all northern communities across Canada, energy costs in Yukon are a major contributor to the high cost of living there. While electricity rates are in line with the southern parts of the country, high per capita energy use (almost twice the Canadian average) and the total dependence of many remote communities on diesel render securing clean, low-cost electricity options a priority [iv].

A key policy goal of the government’s 2009 Energy Strategy for Yukon is to reduce reliance on diesel as a source of backup power, which is expensive and polluting relative to other sources. Diesel is especially necessary to meet peak loads during hydro shortages due to very cold weather or drought [v]. To wean itself off diesel, the government has initiated plans to enhance storage capacity of two of its major reservoirs and is looking at the possibility of developing the necessary infrastructure to import additional hydropower from northern BC for the first time [vi].

In addition, Yukon Energy recently completed the construction of a Liquified Natural Gas plant in Whitehorse, which was promoted as a cleaner and cheaper alternative to diesel [vii]. However, critics of the project say that investing in LNG infrastructure will delay the territory’s move away from fossil fuels and promotes natural gas fracking, which has negative impacts on water resources and climate. They also point to uncertainty with respect to future natural gas prices, which could result in LNG generation becoming much more expensive [viii].

 

 [i] Standing Senate Committee on Energy, Environmental and Resources, 2014.  Powering Canada’sTerritories, Powering Canada’sTerritories, http://www.parl.gc.ca/Content/SEN/Committee/412/enev/rep/rep14jun15-e.pdf

[ii] Standing Senate Committee on Energy, Environmental and Resources, 2014. Powering Canada’sTerritories, Powering Canada’sTerritories, http://www.parl.gc.ca/Content/SEN/Committee/412/enev/rep/rep14jun15-e.pdf

[iii] Yukon Energy, 2015a. “Hydro Facilities”, https://www.yukonenergy.ca/energy-in-yukon/our-projects-facilities/hydro-facilities/aishihik-hydro-facility/

[iv] National Energy Board, 2011. Energy Use in Canada’s North: An Overview of Yukon, Northwest Territories, and Nunavut – Energy Facts, https://www.neb-one.gc.ca/nrg/ntgrtd/mrkt/archive/2011nrgsncndnrthfct/nrgsncndnrthfct-eng.html

[v] Yukon Energy, 2015b. “Diesel Facilities”, https://www.yukonenergy.ca/energy-in-yukon/our-projects-facilities/back-up-electricity/diesel-facilities/

[vi] Yukon Energy, 2015c. “Pine Creek Hydro Project”, https://www.yukonenergy.ca/energy-in-yukon/our-projects-facilities/new-hydro/pine-creek-hydro-project/

[vii] Ronson, J. 2014. “Utilities board approves Whitehorse LNG”, Yukon News, May 16, 2014, http://www.yukon-news.com/news/utilities-board-approves-whitehorse-lng/

[viii] Ronson, J. 2014. “Utilities board approves Whitehorse LNG”, Yukon News, May 16, 2014, http://www.yukon-news.com/news/utilities-board-approves-whitehorse-lng/

 

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