Advancing Bioenergy in the North

While there are some hurdles to overcome, Arctic and Subarctic governments such as the Northwest Territories are working to replace fossil fuels with bioenergy—including modern wood heat and renewable diesel.
By Anna Simet | February 03, 2022

The Arctic region of Earth constitutes one-sixth of the planet’s surface, yet it is home to just 4 million people—approximately 0.03% of the world population. That’s no surprise, as during the winter months of the Northern Hemisphere, it is of the coldest, darkest and most remote places on the planet (and at the same time, known for some of the most spectacular views of the Northern Lights).

The Arctic is mostly made up of parts of Alaska, Russia, Greenland and Canada, the latter of which includes portions of all three of its northern territories—Nunavut, the Yukon and the Northwest Territories. Beginning at the northern borders of Canadian provinces British Columbia, Alberta, Saskatchewan and Manitoba, this region stretches far north into the Artic Circle and is incredibly expansive, collectively measuring nearly 1.5 million square miles.

With a population of around 43,000, the Northwest Territories is the most populated of the three territories, with a land area that’s roughly twice the size of Texas. Its communities are mostly a mix of small towns along the Mackenzie river, with the largest being capital city Yellowknife (20,000), and spread out Indigenous communities on lakes or other rivers.
Like most regions or communities in the Arctic, subarctic or northern and remote locations, the Northwest Territories requires unique energy solutions and poses many challenges when it comes to energy, from cost to accessibility to sustainability and reliability—most relate back to being smaller energy loads with great distances in between (i.e., very expensive to build transmission lines and pipelines, or lack of accessible roads in winter months). While the vast majority of Canada is connected to the North American electrical grid, the NWT is not.

As for energy consumption, the Northwest Territories uses mainly hydro and diesel to generate electricity. According to the Canada Energy Regulator, in normal precipitation years, approximately 75% of NWT’s electricity comes from two small hydropower plants, but in drier years when there is a shortfall—such as in years between 2016 to 2018— the territory is increasingly reliant on diesel, which is the sole or primary electricity source for remote communities or industries not connected to one of the NWT’s two hydro-based grids.

As for heat, heating oil is the most prominent fuel used, along with propane, wood (in many cases, aging and poorly functioning systems) and, as of more recently, wood pellets.

In a bid to solve some of the Northwest Territories energy challenges—which includes reducing emissions and moving to clean energy—the government has laid out a 2030 Energy Strategy, of which biomass-based fuel and technology is an important pillar.

Energy Plan 2030
Drafted in 2017, the strategy has several main objectives, which include, but aren’t limited to, by 2030: reducing greenhouse gas emissions (GHG) from electricity generation in diesel-powered communities by 25%; reducing GHG emissions from road vehicles by 10% per capita; and increasing renewables used for space heating by up to 40%.

The government of the Northwest Territories (GNWT) annually reports progress and investments made to date. As for biomass specifically, the most recent report says in the past year, the GHG Grant Program for Government approved $1.1 million in funding for the installation of wood pellet boilers in two Yellowknife school facilities, and by the end of 2021, “the GNWT’s Capital Asset Retrofit Fund (CARF) program had cumulatively reduced GHG emissions by 16,900 metric tons, resulting in over $4.2 million in cost savings since 2007-‘08. Most of the reductions and cost savings came from a switch to biomass for space heating.”

Modern biomass heating has been rapidly growing since the NWT’s first installation in 2006, which the government believes to be the first containerized biomass (wood pellet) space heating system in North America. At the North Slave Correctional Facility in Yellowknife, the boilers were installed in shipping containers and tied into the existing heating system. In its first full year of operation, heating costs were reduced by nearly $58,000. Since then, more than 40 additional biomass boiler systems have been installed through the NWT, and the government reports that wood pellets have surpassed propane, accounting for 36% of the GNWT’s overall heating fuel supply. “The goal is to make biomass the main heating source for GNWT buildings,” the report says.

While 2030 is the goal year set in the strategy, a 2020 study done by Alternatives North said progress can be made much sooner—in fact, an emissions reduction of 50% by 2025 through a combination actions that include wood pellet heating, renewable diesel and carbon offsets. Specifically: spending approx. $15 million on carbon offsets each year; directly investing approx. $145 million in the construction of biomass district heating systems in NWT communities over the next five years and selling recovered heat from diesel generators; and immediately begin transitioning from fossil diesel to renewable diesel in boilers, vehicles and generators. There are indeed some challenges—for one, current availability with renewable diesel—which is only readily available in California and British Columbia—and the fact that it is more expensive than fossil diesel. While there are numerous proposed and developing renewable diesel operations in the B.C., in the meantime, Alternatives North suggests the GNWT should immediately begin a transition from fossil diesel, beginning with its own internal operations to demonstrate how renewable diesel can be used in boilers, vehicles and generators, and work with fuel suppliers to purchase approximately 200 million liters (52.8 million gallons) of renewable diesel per year within five years, providing a subsidy to reduce the price to that of fossil diesel (about $65 million  per year).

Potential pellet supply issues are also addressed in the report, as there are no production facilities in the NWT, though a proposed wood pellet plant has been in the works for years. (Biomass Magazine attempted to contact Aurora Wood Pellets for a progress update, but did not receive a response).

In all of this, one of the government’s key partners is the Arctic Energy Alliance, which provides residents, communities and businesses with funding and the tools they need to increase energy efficiency, save money and reduce emissions.

Growing Biomass in the NWT
AEA is headquartered in Yellowknife, which is located on the northern shore of Great Slave Lake, the deepest lake in North America and tenth-largest lake in the world. Residents there see an average of just five hours of daylight during December, and for most of the month, the sun doesn’t rise until after 10 a.m., setting just after 3 p.m. And with June comes 20 straight hours of daylight, with what is dubbed the “Midnight Sun” appearing May to late July.

During his interview with Biomass Magazine, Kevin Cull, communications coordinator with the AEA, says it is -35 degrees Celsius (-31 degrees Fahrenheit) in Yellowknife. With these long periods of cold and dark, he points out how crucial, challenging and costly that heating homes and businesses is. “We help do this through a number of ways, and one of the biggest is through providing rebates to people who buy more energy efficient equipment, or adopt renewable energy systems like biomass heating or solar panels,” he says. “We do home energy evaluations to let home owners know how they can save energy, and well as commercial energy audits. We also provide free advice to people and do community outreach and engagement to educate people on how they can save energy or reduce GHGs. We have a number of different programs.”

Cull says that wood heating is a long-established form of heating in the NWT, but a focus on what the AEA does is to replace older, polluting and poorly functioning systems. “We provide rebates to those who buy a new U.S. EPA-certified wood stove or upgrade to a new one, and we also have a community wood stove program (CWSP) to help cover capital costs and ensure we have good, safe biomass heating in homes throughout the territory. Unlike our rebate programs where somebody buys one and applies for some reimbursement, the CWSP is a partnership model where we team up with a community or organization and we each pitch in half the cost to buy stoves and have them delivered—typically in smaller, more remote NWT communities.”

These recipients get their stoves for free, according to Cull, and the community partners get to decide who gets the stoves, which often goes to people most in need. “In some cases, people get new stoves and they have never had a wood stove before, and in other cases, people are replacing old stoves that aren’t safe anymore with new, more efficient stoves that use less wood. We have had some replaced that were completely burned out and a major fire hazards. In one case, somebody got a stove and because it was now installed according to safety code, they were able to get home insurance, when they couldn’t before.” 

 For the businesses, community governments or nonprofits that AEA assists in putting in a biomass boiler system or furnace system, these usually ends up being a pellet boiler, as they are better known and easier to use and operate for most buildings, Cull says. “They’re becoming more common throughout the territory, and we help people figure out if they want a biomass heating system, and which type of works best for them through a program specifically geared toward advice to community governments.” For commercial biomass boiler projects, AEA will rebate half of the project costs, up to $50,000, and manage project coordination.

AEA has helped several communities in the territory adopt district heating systems that heat anywhere from three to five buildings, and are currently working with a couple more to get systems up and running. “This has all come out of our biomass advice program,” Cull says. “We worked with community governments or development corporations that wanted to put in systems. In one of the cases, the community that owns the district heating system is selling its heat to the territorial government to heat one of their buildings. The city of Yellowknife in particular has adopted a lot of district heating systems, and has done so really without our help.”
While most or all the operating or in-development district heating systems in the NWT use wood pellets, Cull says, some have been designed to also be able to use wood chips. In these cases,  the communities can harvest local wood, chip it and use it in their boilers. “But I don’t believe any communities of those are up fully running yet,” Cull says. “We are working on a project right now to try to get wood pellet boilers installed in a couple of local businesses—they pay the cost, we handle the logistics and project coordination—they’re still underway so I can’t disclose much, but it will be a neat project once it’s done.”

As for (potential) pellet supply issues, as addressed in the Alternatives North, Cull says AEA has not seen any issues yet, though there are some price fluctuations. “There is a pellet plant not far from the NWT border, and most buy from that plant,” he says. “There are a few other manufacturers who sell their pellets here as well.”

Finally, Cull points to the ambitious goals of the NWT 2030 Energy Strategy, which he emphasizes is designed to double the amount of biomass heating from its rollout until then.

Less remote communities like Yellowknife may find it considerably easier to transition to biomass heat than the extreme remote, most of which rely on diesel generators to produce power and meet heating needs—communities like these are scattered across Canada. They are, however, in a unique position to take advantage of the development of wood-based bioenergy projects with many socio-economic and environmental benefits, according to a recent study.

Extreme Remote Communities
The authors of “Derisking Wood-Based Bioenergy Development in Remote and Indigenous Communities in Canada” collaborated with five remote and Indigenous communities across the country to investigate the main barriers and potential solutions to profitable and sustainable wood bioenergy systems. Nicolas Mansuy, coauthor and lead of the project, discussed results with Biomass Magazine. “Remote and northern communities surrounded by forested areas are well positioned to use wood-based bioenergy to meet their energy needs, and thereby reduce their GHG emissions,” says Mansuy, who works in the Edmonton, Alberta-based Canadian Forest Service’s  Northern Forestry Centre.  “In Canada, approximately 200 remote, off-grid communities rely on diesel to meet their main power needs, and most of them are Indigenous communities,” he says. “Using diesel in remote off-grid communities creates many environmental, health and economic issues. It’s often transported thousands of kilometers across winter roads and crossings that are only open when the ice is thick enough for transport, and as a result of these long transport distances, the price of energy in remote communities can be up to 10 times more than what the average Canadian pays.”

 In addition, Mansuy says there is potential for storage tank leaks, which can result in soil or ground water contamination and are associated with health concerns over impacts to air quality, food and water supply. “Wood-based bioenergy can not only avoid these environmental impacts, but also reduce GHG emissions associated with the burning and transportation of diesel. Moreover, when deciding on a renewable energy system, Indigenous communities have often voiced socio-economic needs such as creation of a local source of revenue, jobs and training opportunities for community members, increasing energy autonomy, reliability and community leadership, and lowering energy costs. Considering the socio-economic priorities and needs of the community is therefore crucial to ensure the success of a bioenergy project.”

Whether in the NWT or other remote locations, one of the study’s main conclusions was that remote and Indigenous communities share some common challenges and barriers in developing bioenergy projects. “Federal initiatives like the Clean Energy for Rural and Remote Communities program developed by NRCan, and the Northern REACHE program developed by Crown-Indigenous Relations and Northern Affairs Canada  have committed close to $300 million over the eight years, from 2018 to 2026, to support the development of clean energy in rural, and remote communities, most of which are Indigenous,” Mansuy says. “However, despite the funding support from the government, all the communities in our study have reported that high initial investments and energy market competition—the price per kilowatt-hour for diesel and natural gas is relatively cheap in Canada compared to woody bioenergy—are the main barriers in developing cost efficient bioenergy supply chains. When considering bioenergy systems, communities need also to consider costs associated with biomass transportation and storage, boiler maintenance, repairs and malfunctions, and external consultants.”

One way to mitigate these costs and make bioenergy projects more attractive to the community is to look at what Mansuy refers to as “positive externalities. These include environmental and socio-economic benefits such as avoided costs of tank cleaning and site remediation, the creation of local jobs and incomes, opportunity for training, community leadership and community-based resources management supported by local knowledge and workforce.”

Mansuy notes a community-based bioenergy system should consider the geographical context of the communities and the proximity (and accessibility) of the biomass source. “Some communities use local feedstock like chips produced from nearby forests or fire residues harvested from frequently burnt forest, and can develop their own local biomass supply chain. This is very beneficial because they can reduce transportation costs as well as the GHG emissions associated. By doing so, they also have an opportunity to involve community members and create local jobs and revenues that stay within the community.”

The challenge, however, is to find skilled people to lead day-to-day operations. “Considering their remoteness, some of the communities rely on imported feedstock like pellets from long distances—more than 2,000 kilometers—using a more established supply chain. In that situation, the pellets are mostly produced from harvesting or processing residues from forestry companies, but the community is not involved. That is why is important to support community leadership and capacity from the very beginning  not only to develop the most sustainable and cost-effective biomass supply chain, but also to ensure that the whole system is integrated with the needs and values of the community.”

While the communities studied are generally too small—in terms of population and energy needs—to build a pellet plant for their own, regional plants need to be investigated further, either in Yukon or NWT, to supply the northern communities, according to Mansuy. “With an economy of scale, there are opportunities to reduce the costs and supply more communities at once. It is also a potential way to create permanent jobs. But the biomass supply chains and the logistic need to be secured first,” he says.

 The implementation of biomass energy systems in Indigenous and northern communities in Canada is relatively new, with many communities having only a few seasons of operation at most, Mansuy points out. To scale up these projects, he says, it is critical to gain a better understanding of what has or has not worked in terms of community capacity and engagement, feedstock supply, GHG mitigation potential and system design. “That’s why the study was focusing on the risk and barriers, but having said that, most of the communities are favorable to bioenergy development because they are well aware of the environmental and socio-economic benefits,” he says.

Pushed by the Canada’s climate strategy,  there is real momentum in the country for community-based clean energy development, with the number of clean energy projects led by Indigenous communities growing significantly, Mansuy adds. “Some communities are more advanced than others, and we are starting to see some very effective collaboration and networking to share knowledge, expertise and success stories. All this is very positive and promising, not only to advance the bioenergy sector, but also the leadership  of the communities.  

Author: Anna Simet
Editor, Biomass Magazine
[email protected]