The Saskatchewan government has informed Crown employees it will extend the life of all its coal-fired power plants, setting up a potential legal battle with the federal government over environmental regulations.
Crown Investments Corporation Minister Jeremy Harrison announced the decision in a letter distributed to all SaskEnergy employees on Wednesday. It was not announced publicly.
Harrison said the province will continue the use of the coal plants as it moves toward adopting nuclear power generation for its base load requirements, and remains committed to the goal of a net-zero grid by 2050.
READ| Letter to SaskEnergy employees
The letter also tees up a potential dispute between the province and Ottawa, with Harrison writing that the province does not believe the federal government has any standing to shut down provincial coal plants.
“We have also been clear that we do not recognize the legitimacy of the federal Clean Electricity Regulations,” Harrison wrote.
Brett Dolter, a professor of economics at the University of Regina, described the decision as an “incredibly disappointing development.”
Dolter, who has researched electricity options and pathways in Saskatchewan for more than a decade, said the decision to extend the life of the province’s coal-fire plants violates federal regulations meant to reduce carbon dioxide emission.
“This opens up the door for protracted legal battles with the federal government and great uncertainty at a time when rapid investment in our electricity system is needed, ” Dolter said in an email.
The province announced earlier this year that it was mulling this decision over.
At the time, it appeared to fly in the face of years of work on the coal-fired power plants. In 2012, then-prime minister Stephen Harper’s federal government passed new regulations that would see the end of most coal-fired power by mid-21st century.
In 2016, Justin Trudeau’s government passed further regulations requiring all coal-fired power stations to be closed down after 50 years of operation, or by 2030, whichever comes first. The province has previously said it would comply with those rules.
The decision announced today makes it clear that will no longer happen.
Saskatchewan even provided financial support for communities as it initially pushed toward ending its use of coal-fired plants. In 2020, it announced Estevan would receive $8 million and Coronach would receive $2 million. A further $550,000 was announced for Coronach in 2023.
A ‘Blockbuster Video’ decision: expert
Work to “restore” Boundary Dam 4 to service and get it recertified is set to begin this year, Harrison wrote.
He also promised to extend the lives of all coal units at Poplar River Power Station near Coronach, as well as Shand Power Station and Boundary Dam Power Station near Estevan, in the “years to come.”
It’s not clear how much that work will cost. The province “isn’t releasing cost estimates at this time.”
A final decision on whether an SMR will be built in the province is not expected until 2029. If approved, construction could begin as early as 2030, with the first SMR in Saskatchewan becoming operational as soon as 2034. CBC Saskatchewan reporter Alexander Quon explains why the province is looking to set one up in the first place.
Dolter said he believes the cost will be significant and that a better investment would be constructing new power plants that can operate beyond 2050 and are resilient to any future policy changes at the provincial and federal levels.
“Investing in coal power plants now is like Blockbuster Video doubling down on building new VHS-rental stores in an era of Netflix and other streaming services. It is a waste of Saskatchewan ratepayers’ and taxpayers’ money,” Dolter wrote.
Environment and Climate Change Canada did not immediately respond to a request for comment.