AltaLink's Transmission Planning Strategy

On Wednesday, October 17, 2007, AltaLink announced its new transmission planning strategy and vision for land use in Alberta. It invited the government, industry, the Alberta Electric System Operator (AESO) and landowners to support an innovative approach to transmission planning.

For more information about the strategy, please view the news release titled AltaLink Calls for New Transmission Planning Strategy in the News Releases section, and the documents below which include Scott Thon's, President and CEO, speaking notes, a one-page summary of the announcement and a backgrounder about transmission in Alberta.

Speaking Notes

Balancing Infrastructure Development with Land Use – Respecting our land while meeting Alberta’s needs

Scott Thon, President and Chief Executive Officer
AltaLink
Speaking notes (check against delivery)

Every Albertan expects the lights to stay on. That is why I am here – as both an Albertan and the CEO of AltaLink – to challenge our industry, government and all Albertans to begin to think differently about how we work together to provide power for us all.

I don’t have to tell anyone Alberta is growing very fast.

The staggering pace of Alberta’s growth in the last five to 10 years has put tremendous demands on infrastructure throughout the province. Whether we’re talking about roads, hospitals, schools, energy or power lines, Alberta growth is making it difficult for infrastructure to keep up with the pace of our economy.

This is a challenge we all face together and we need to find solutions that fairly meet the needs of Albertans while respecting a resource precious to all of us – our land. Too many issues are dividing Albertans, I believe it’s time to work together.

At AltaLink, we know there is an expectation from Albertans that they have reliable electricity. We are ready to meet those expectations by moving power to consumers and businesses.

However, in developing transmission in this province it is clearly time for a change. Today, I am announcing AltaLink’s commitment to a new and innovative direction on transmission development in Alberta. My message to you and all Albertans this morning is about leadership in bringing forward a new vision for Alberta’s transmission system, one that recognizes the need to be more efficient in how we use land by focusing on reusing facilities and maximizing the capacity of the infrastructure that must be built.

To describe what I mean, let’s first talk about need, then about land use and innovation and let me then conclude with comments about engaging Albertans going forward.

The need for reliable electricity is critical and, at this point in our province, undeniable. And let me be clear, when I’m talking about the need, I’m talking about much more than the transmission system between Edmonton and Calgary. There is need, in all corners of our province and it’s driven by new residents and a growing economy that add the equivalent of two cities the size of Red Deer to our electric system each and every year.

At AltaLink, we are Alberta’s largest electricity transmission provider, owning and operating an electrical grid that serves 85 per cent of Albertans. Transmission is at the core of our expertise. Our 24/ 7, 365 days a year operations team leads the province in delivering reliable power. In the last five years we have successfully built more than four hundred kilometres of transmission lines across Alberta. But more importantly we have successfully worked with hundreds of landowners across Alberta in finding ways to meet their needs.

Albertans recently participated in the development of the Government’s Land-use Framework and they clearly said there is a need for more balance between development and environmental sustainability. With this in mind, as a society we need to think in a bigger context; especially with respect to our land and resources for future generations. As we completed these projects we heard loud and clear from many people across the province who are impacted by new facilities, that land is precious and that it is a limited resource in Alberta. They also told us it is not limited to electricity facilities; conventional oil and natural gas production, pipelines and coal bed methane facilities are all part of why many people are feeling anxious about Alberta’s land use. So we heard those concerns and began to look for new solutions, and a new approach to delivering the much-needed transmission system reinforcements in the province.

The supply of land isn’t infinite. As a company committed to this province we know we need be more effective in how we use the land and in how we engage landowners and the public.

So how can Alberta do that? The proposal we’re introducing today helps all of us by firmly establishing the need to consider land use in a new way, much earlier in the planning process. Respecting the land and resources means Alberta must adopt new principles of minimizing the footprint, maximizing capacity infrastructure and conserving the land resource. At AltaLink we are taking an innovative approach to transmission by focusing first on reusing existing rights-of-way and reusing the land currently occupied by older, lower capacity lines for new, high capacity lines before we look to cut a new path of land. Reusing rights-of-way conserves land for future generations while ensuring we meet the demands for power in Alberta today.

So what does this approach mean for the current challenge in the Edmonton-Calgary corridor? Well, the need for the line certainly hasn’t changed. It remains critical to ensuring that the 1.5 million Albertans who live south of Edmonton have reliable power. Our first proposal of steel towers carrying one circuit remains with the Alberta Electric System Operator, as it is the simplest alternative. But the reuse approach provides another new opportunity to meet that need. It will mean we can move forward with a second viable option on the north south 500 kV transmission line. We can design and build a single tower that carries on it the equivalent of the electricity carried by two towers. Once the more efficient configuration is in service, we will then commit to remove the existing single-circuit, lower capacity 240 kV line. This makes sense for Alberta. And this approach supports the vision of minimizing the impact on the land and on landowners. But we can not do it alone, it will require all of us – transmission facility owners, the government, the AESO and the public – to take a new look at transmission planning.

Today we are working with our other industry members, the Alberta government and the AESO to enable this solution – a solution that involves maximizing capacity and flexibility of existing right-of-ways. This means new technologies. From multi-circuit Alternating Current towers, to high capacity Direct Current systems to underground technologies – all these are focused on maximizing electricity on a minimum footprint of land.

We have seen the Government of Alberta place tremendous importance on:

• Ensuring Albertans have access to the low-cost electricity providers; which has seen more megawatts of electricity generation built in Alberta over the last decade than in any other province in Canada.
• Ensuring Albertans have reliable electricity in their homes, farms and businesses; which has seen the critical expansion of new residential substations and distribution lines to feed new customers across the province; and
• Minimizing the land-use impact of much needed infrastructure development.

This new solution of reusing land wherever possible is the next logical step to integrating all of these key concerns of the need for low cost, reliable electricity while respecting our land and the landowners who support Alberta’s growth.

For the Calgary to Edmonton expansion it means minimizing the required land base to provide much needed power to the 1.5 million people in central and southern Alberta.

What is our commitment to engage landowners and the public at large? We need to bring forward options that are more sensitive to land use. As illustrated by our thousands of one-on-one meetings with landowners on the Calgary to Edmonton project alone, AltaLink is very committed to being open and transparent about our work and to consulting with impacted landowners in a better way. Feedback from landowners has and will continue to shape our proposals, just as feedback from our customers shapes how we ensure the lights stay on across Alberta.

Beyond the issue of land use, independent research has shown that most Albertans do not understand our electricity system or its infrastructure challenges. We need to correct that. Today I am making another commitment. AltaLink is stepping forward in an initiative to ensure our industry is better understood by the people who rely on it every day.

Today I am announcing our intent to work with the Canadian Centre for Energy Information in sponsoring the development of a new, factual and comprehensive electricity public education program. As this program evolves I will be back to you with more information. But today as we make this commitment to public education, I also invite my industry colleagues to come on board and ensure the success of this initiative. I will be calling you personally to get your support.

In closing, Albertans are innovators and we can solve complex problems when we work together. I am committing AltaLink to a new vision for our transmission system. While the need for new transmission is undeniable, Albertans are rethinking how we use the land and as an industry we should help lead with solutions. It is our belief that land use must be considered in a new way, very early in the transmission planning process. We must be more efficient in how we use the land by reusing rights-of-way and maximizing the capacity of the new infrastructure that is built. Therefore, we are inviting the provincial government and the Alberta Electric System Operator to adopt planning criteria that places more weight on land-use issues earlier in the transmission planning process. Together we can step forward on a new path for transmission development in order to provide the power system our province needs and deserves.

Thank you and I’m happy to answer any questions you may have.

One-Page Summary

The Challenge

To resolve Alberta’s urgent need for electricity infrastructure, while respecting and addressing the legitimate impacts on the land and the landowners who bear the burden of future development.

The Solution

Through innovation in technology and policy, and a new approach to engaging citizens, we can maximize the value of our current electric infrastructure footprint while preserving a high degree of adaptability and scalability for new projects that are required to meet Alberta’s future electricity needs.

Innovative Techniques

• Maximize existing rights-of-way
• Minimize footprints on new builds
• Preserve future growth and flexibility
• Explore underground solutions

Innovative Policy

• Flows from the Transmission Regulation
• Mandate that land use be considered earlier in the transmission planning process

Innovative Consultation

• Include landowners and citizens
• Respect that land is a limited resource

The Project

Transmission reinforcement between Edmonton and Calgary is clearly needed. The Alberta Electric System Operator has stated that without the reinforcement of the Edmonton to Calgary transmission system, Alberta’s grid will be operating below North American reliability standards.

Recognizing the critical need and employing a new philosophy for transmission planning, a solution becomes clear.

Parallel existing 240 kV lines with a double circuit line with one side energized at 500 kV and the other at 240 kV. This would allow the removal of the single circuit 240 kV line, creating no incremental impact on landowners as a result of additional towers, opening up much-needed space between towers and meeting the electrical needs of the province.

Backgrounder

The Need for Electricity Infrastructure

Alberta is Growing

• Alberta’s population has grown from 1, 838,035 to 3,435,511 in the past 30 years.
• Over the next 20 years, Alberta’s population is forecast to grow 21 per cent.
• Alberta’s growth has led the country, with Gross Domestic Product increasing 16 per cent from 2001 to 2005.
• Power use in Alberta has increased 35 per cent in the past 10 years.
• Alberta’s gross annual load growth of 300+MW is roughly equal to Ontario’s load growth, a province with three times the population of Alberta’s.
• The pace of Alberta’s load growth is also greater than the United States. The U.S. Energy Information Administration estimates their country’s load growth at 0.8 per cent for 2006 and 2.1 per cent for 2007.

Our Transmission System is Aging

• The backbone of Alberta’s electric system has not been upgraded in more than 20 years.
• Almost $500 million worth of AltaLink’s transmission system is more than 35 years old.
• Albertans are currently paying approximately $3 million a month due to inefficiencies in the transmission system in the form of line losses on the north-south corridor.

A Solution is Necessary

• From December 2002 to November 2006, Alberta’s peak energy demand grew by 1,091 megawatts – enough to power approximately one million homes.
• According to the Independent Power Producers Society of Alberta, ten years ago Alberta’s peak load was 7,200 MW. In 2006, Alberta’s peak load was 9,661 MW.
• If growth and demand continue as forecast, the addition of up to 3,800 megawatts of new generation may be required by 2016.

AltaLink is Responding

• AltaLink invested $128 million in 2005, $245 million in 2006 and during the first six months of 2007, AltaLink invested $99.2 million into Alberta’s transmission system.
• The Alberta Electric System Operator’s (AESO) 10-year plan forecasts the need for $3.5 billion in proposed transmission development to ensure a reliable supply of electricity.
• If all of the AESO’s developments are built, this investment in critical infrastructure would result in less than $5 charge to the wires portion of a residential power customer’s monthly bill.

Sources: The Alberta Electric System Operator, Statistics Canada, AltaLink’s 2006 Report to our Communities