Maritime Electric, the investor-owned utility that serves PEI, has issued a request for proposals (RFP) for 30 MW of renewable energy to meet domestic need and another 100 MW for export from the island.
"Domestic wind supplies Maritime Electric with one of its lowest-cost sources of electricity, while the export of wind gives the utility revenues that contribute towards lower energy costs for Islanders," says PEI Energy Minister Richard Brown.
Winning bidders for domestic supply will receive 20-year power purchase contracts from the utility and will be expected to have projects online by October 2012. Maritime Electric is also making 100 MW of export electricity transmission capacity available on two undersea cables across the Northumberland Strait that link the island with New Brunswick's power grid.
Export projects will have to be online by October 2013. Developers will be required to find their own purchasers for this power and will also have to pay the government an annual royalty - known as an environmental fee - of C$15,000 per megawatt installed.
Bids in the RFP are due by January 29, 2010, and contracts between winning bidders and Maritime Electric are expected to be signed by April.
The province, Canada's smallest with an area of 5660 square kilometres, has little in the way of indigenous energy sources besides the wind. As a result, the resource has become a focus of the provincial government's economic strategy. Making sure islanders see some benefit from exports is a central goal, says provincial energy ministry spokesman Ron Ryder.
Wind is the only electricity generation on the island, meaning that the province is almost entirely reliant on imported sources of electricity, most of that generated from fossil fuels. Island residents have seen electricity prices jump by 60% since the beginning of this decade. More wind energy, says Maritime Electric chief executive, Fred O'Brien, will reduce PEI's dependence on fossil fuel based supply sources that are purchased from off-island suppliers, which will help to stabilise power prices for consumers.
Environmental sustainability is also a driver behind the purchases, says Brown. "We're a small province surrounded by water and as the climate (gets warmer), the smaller our province gets," he says. "So we're very concerned about climate change."
Double the demand
The new supply will boost PEI's installed wind capacity to almost 294 MW, nearly twice the province's electricity demand of 160 MW. The island city of Summerside is in the process of building a 12 MW project, expected online this year. Of the 152 MW currently operating, 90 MW is exported into the New England market and the output from the remainder accounts for about 18% of the province's electricity needs.
The province has set a target of 500 MW of installed wind capacity by 2013, with 390 MW designated for export and the rest supplying 30% of PEI's electricity. Further progress, however, will have to wait until a new transmission link with the mainland is in place. The provincial government is seeking federal stimulus funding to help cover costs of a new line, estimated at C$95 million.