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Canada

Research to reduce diesel dependence -- Remote communities

Newfoundland and Labrador Hydro (NLH) has launched a five year, C$9.7 million wind-diesel-hydrogen research project that it hopes will ultimately help end its dependence on diesel fuel to provide electricity to remote communities. The utility operates 21 isolated systems serving about 3500 customers along the coasts of both the island of Newfoundland and mainland Labrador. Together they burned 13.7 million litres of diesel to meet electricity demand in 2006.

One of the systems is in Ramea, an island community of about 700 located six kilometres off the southwest coast of Newfoundland, where a demonstration wind-diesel project has been operating since late 2004. The project's six Windmatic 65 kW turbines have supplied NLH with almost 800,000 kWh of energy since they came online, offsetting the burning of more than 216,000 litres of fuel in the system's three 925 kW diesel generators. The utility hopes to offset even more by adding hydrogen storage to the mix.

In the short term, wind-hydrogen should displace about 425 MWh of diesel generation in Ramea, where total electricity demand was 3790 MWh in 2006. "The ultimate long term goal is that 100% of the diesel fuel will be displaced via a wind-hydrogen system with diesel generation backup," says Jim Keating, NLH's business development vice president.

Cleaner air

Burning less diesel fuel means cleaner air for remote communities and fewer environmental impacts. But there are other potential advantages to developing a storage option for isolated grids, says Keating. Lowering the cost of wind energy by capturing more of it is one; reducing operating costs that are now highly dependent on rising and volatile fossil fuel prices is another. The average cost of diesel fuel in Ramea last year was C$0.22/kWh.

Potential commercial opportunities were also a factor in NLH's decision to go ahead with the project. "We plan to market this technology, along with the system engineering and integration, around the world to other utilities or diesel system operators. There are over 100 isolated communities across Canada alone that have the potential to benefit from this system," says Keating.

The research project includes the installation of additional wind turbines, an electrolyser that will use excess wind power to produce hydrogen from electricity and water, hydrogen storage tanks, hydrogen generators and a control system to integrate all of the components.

NLH plans to complete detailed engineering and design work over the next six to ten months, with construction expected to start in spring 2008. "The project will be monitored, tweaked and improved with research and development activities continuing for three years after commissioning," says Keating.

Commercial horizon

By the end of the demonstration period, NLH hopes to have a marketable system. The key to its competitiveness will be to bring the cost of electrolysis down, but the utility is hopeful that aggressive targets set by the US Department of Energy's hydrogen research program will lower electrolysis costs substantially in the coming years. Another factor will be implementation of policies that force an accounting of the environmental costs of polluting generation.

"Depending on the pace of innovation in electrolyser technology and the recognition of environmental costs, we anticipate a wind-hydrogen-diesel system to be cost competitive against traditional stand alone diesel within the next five years," says Keating.

The utility will be working with Natural Resources Canada's CANMET Energy Technology Centre, Faculty of Engineering and Applied Science at Newfoundland's Memorial University, the Sustainable Power Research Group at the University of New Brunswick, and Frontier Power Systems, the Prince Edward Island-based owner of the Ramea wind turbines, through the life of the project. The partners will be making technical and financial contributions to the research. The project is also getting a C$3 million grant from the federal government's Atlantic Canada Opportunities Agency (ACOA).

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