Yukon Energy defends LNG plan

Assessors have asked Yukon Energy Corp. to back up its claims that burning liquefied natural gas in Whitehorse is the best solution for ratepayers.

Assessors have asked Yukon Energy Corp. to back up its claims that burning liquefied natural gas in Whitehorse is the best solution for ratepayers.

Yukon Energy currently has a proposal to replace two diesel generators with ones that burn natural gas before the Yukon Environmental and Socio-economic Assessment Board’s executive committee.

Last month the board asked for more information from the company about why LNG is being considered over the alternatives.

The board received more than 100 responses to the proposal when it was open for public comment in December and January.

Many questioned why Yukon Energy is saying that the LNG will be used for peaking and back-up power demand when usage of diesel or gas generators is forecast to increase tenfold by 2030.

“This representation seems contrary to the purpose of the project as primarily a back-up power source,” wrote the board in its request to Yukon Energy.

The board also asked for more detailed information on possible usage of renewable energy, and on the cost savings of using LNG versus replacing the aging diesel generators with new ones.

Yukon Energy responded to these questions last week.

The company says it must replace the old generators in order to meet capacity requirements recommended by the Yukon Utilities Board.

“The project’s purpose is to ensure that Yukon Energy maintains the infrastructure necessary in the next few years to address the YUB’s recommended reserve capacity planning criteria requirements, has reserve capacity for seasonal low-water periods and drought years, and is able to meet non-industrial load growth and peak demand in the short term with the least impact on ratepayers,” according to the document.

Replacing the diesel generators with ones that burn natural gas will result in savings to taxpayers, according to Yukon Energy.

The savings on fuel costs are expected to be $1.3 million in the first year of operation, increasing to $2.2 million in the second and $2.6 million in the third.

Although the generators are expected to be used more and more as power demands increase, Yukon Energy will continue to look at renewable power options to offset the use of diesel and natural gas, the document says.

The switch to natural gas will save money even if new renewable power is brought onto the grid in the short term, according to Yukon Energy.

The assessment board is now in the process of looking at all the information it has been given to generate a draft set of recommendations for the project.

There will be another round of public consultation before the board produces its final recommendations.

All documents related to the assessment are available to the public on YESAB’s online registry.

The Yukon Utilities Board must also review and approve the project.

It has been asked to make a decision by mid-April.

Contact Jacqueline Ronson at

jronson@yukon-news.com