Why biomass district heating could help decarbonize the North

Many buildings throughout the Northwest Territories already burn wood pellets for heat, but backers of biomass district heating say we need to think bigger.

On a January day, Lachlan MacLean stood outside Yellowknife’s Explorer hotel, taking in the view of downtown. “This particular spot, I feel, tells the story,” he said.

The city’s core has the highest-density heating load in the Northwest Territories, according to MacLean, yet most of the buildings still use heating oil.


Although several Yellowknife building owners have installed systems that burn biomass (such as wood pellets) instead of oil, in an effort to reduce costs and carbon emissions, space in the heart of downtown is limited.

“There’s not actually a lot of room to put a boiler, and put a silo, and to have a delivery truck pull up to it,” said MacLean, who is a member of Alternatives North, a social and environmental justice coalition based in Yellowknife.

District heating – where heat produced at a central location is piped to several buildings – might provide an answer, he said.

Across the street from the Explorer Hotel, MacLean pointed to empty lots that could house an energy centre. There, wood pellets could be burned to heat water that would then be distributed via insulated underground pipes.

“This has promise,” MacLean said of a biomass district heating system downtown.


“If it’s going to work anywhere, it’s going to work here.”

A closer look at the economics

Last month, Alternatives North published a report that takes a detailed look at the business case for developing a biomass district heat system in the city’s core.

The work builds on a 2020 report that highlighted biomass district heating as one of the most immediate and affordable options for reducing the territory’s greenhouse gas emissions.

Biomass refers to plant- or animal-derived material, such as wood pellets or chips. A common version of biomass heating involves feeding wood pellets into a boiler and burning them.


In the North, biomass heating systems have a proven track record, according to MacLean. Plenty of buildings are already heated with biomass, including Yellowknife’s jail, Stanton Territorial Hospital and the neighbouring Stanton Legacy Building.

Stanton Territorial Hospital. Chloe Williams/Cabin Radio

Two pellet boilers serve as the main source of heat for the legacy building, with two propane-fired boilers serving as backup, said Elvis Brown, operations manager of the boiler system, during a recent tour of the facility. The tour was organized by the Arctic Energy Alliance as part of Biomass Week, which featured presentations on biomass heating technologies.

Elvis Brown opens a pellet boiler that helps heat the Stanton Legacy Building. Chloe Williams/Cabin Radio
Inside the pellet boiler. Michelle Leger/Arctic Energy Alliance

Although the legacy building’s system has been up and running for a few years, this is the first year that it’s running at full capacity, Brown said. Using the pellet boilers saves about $1,400 to 1,500 daily in heating costs, he estimated.

A few micro-district heating systems have been developed in the city, too. A biomass district heating system on Woolgar Avenue, for example, supplies heat to a handful of buildings, including the territorial government’s central warehouse.

None of the city’s existing systems match the scale of Alternatives North’s vision for downtown, however.

Since Alternatives North published its 2020 report, both government and industry have been hesitant to take on such a project, MacLean said during a presentation at Biomass Week. Alternatives North saw an opportunity to take the next step by conducting an economic feasibility study for the project, he said.

Working with FVB Energy, an engineering consultant that has previously studied district energy in Yellowknife, MacLean and his colleagues engaged with the Arctic Energy Alliance, the City of Yellowknife and building owners to compile the most recent information on district heating, energy costs and heating loads.

The team then envisioned what the system would look like under two scenarios – if it were operated by a for-profit versus a non-profit organization – and assessed the project’s financials over a 30-year period.

In both cases, the system would provide roughly 80 percent of the buildings’ heat energy requirements, the group reported, meaning building owners keep their existing boilers to meet peak loads.

Under the for-profit scenario, the system would heat 50 buildings and cost $72 million, they estimated. The project’s return on investment would be roughly eight percent, and it would reduce emissions by 393,000 tonnes of CO2-equivalent over 30 years.

If the project were developed by a non-profit organization, it would heat 74 buildings and cost $85 million. The project would have a return on investment of 20 percent and reduce emissions by 483,000 tonnes of CO2-equivalent over 30 years.

The cost of reducing emissions through biomass district heating on a per-tonne basis is roughly $20 to $50, according to MacLean. For context, reducing one tonne of emissions through the GNWT’s upcoming electricity projects costs about $300, he pointed out.

Neither the for-profit nor the non-profit case survives without the carbon tax, however, MacLean and his colleagues found.

“It’s a bit of a catch-22,” he said. “People will say you can’t charge the carbon tax because we don’t have alternatives. But part of the reason [for] having a carbon tax is that it makes alternatives economically feasible.”

Although there is still a lot of work to be done, MacLean said the analysis shows the project is doable. He said it just takes a champion to move it forward.

A ‘proven approach’ in the North

Yellowknife’s downtown isn’t the only place in the NWT where biomass district heating is being considered. During Biomass Week, several other presenters said they were looking into the systems.

In Hay River, for example, the Rowes Group of Companies is investigating a possible biomass district heating system that would connect three buildings, two of which have boilers in need of replacement, according to Ronald Schaub, the group’s general manager.

Biomass district heating is also among the options being considered in a pre-feasibility study on renewable electricity and heating options in Wekweètì, said Ryan Makela, manager of northern development at energy firm Atco.

And in Yellowknife, J&R Mechanical – the company that operates the district energy system on Woolgar Avenue – is considering expanding the system into more buildings, said Ken Miller, the company’s owner.

Advocates say this trend toward district heating is overdue. Community-wide district heating is not only possible in the North, it is the proven approach for low-carbon heating, said Jamie Stephen, managing director of TorchLight Bioresources, in another presentation.

“If you look at every other northern country, 55 to 95 percent of the population gets their heat from district heating,” he said. “We are the exception.”

Approaches to decarbonizing northern Canadian communities so far have been “fundamentally wrong,” he said.

“If we are going to decarbonize these communities, it’s not going to be on batteries and wind power,” Stephen said. Although wind and solar may play a role, Stephen thinks they likely won’t eliminate fossil fuels. Heating is the largest energy draw in the North, he said, and people need a reliable solution.

“Ultimately, we need to burn something,” Stephen said. In terms of renewable sources, he said, wood pellets are the best option.

A file image of wood pellets
A file image of wood pellets.

So far, biomass systems in Canada have tended toward smaller-scale projects. In a database of 500 bio-heat projects across the country, Stephen said most connect two to five buildings.

We need to think bigger, he said.

District heating offers fuel flexibility

There are still many hurdles to making biomass district heating the norm in northern communities.

Compared to other Arctic nations, Canada’s marine infrastructure in many northern communities is lacking, Stephen said, which may pose a barrier to delivering wood pellets and powering community-scale biomass systems along the country’s northern coast.

A silo used to hold wood pellets outside the Stanton Legacy Building’s biomass boiler system. Michelle Leger/Arctic Energy Alliance

In the NWT, biomass operators also have few options for sourcing pellets. One of the few suppliers that is cost-effective for the North is in Alberta, said Schaub in his presentation.

In addition, scientists and environmental groups have raised questions about whether burning biomass really reduces emissions.

For biomass systems to be carbon neutral, emissions released by burning wood pellets have to be capturing by re-growing forests, as Yale Environment 360 previously reported. Depending on where the wood is sourced to make pellets, this may or may not be the case.

“The broad lesson humanity’s got to learn, coming out of this, is that you can’t afford to be ignorant of where things come from and where they go,” said MacLean, from Alternatives North. But it is possible to source biomass sustainably, he said.

“There’s also an important thing to recognize about a biomass district energy system, which is that it’s a district energy system first, and the fuel source is biomass,” he said. “Once you have pipes in the ground, you can take heat from anywhere.”

For example, excess hydroelectricity or cardboard and paper waste could be used to heat the water in a district energy system, he said.

“Getting pipes in the ground opens up a lot of opportunity,” he said, but “to get those pipes in the ground, you need a solid business case. And biomass creates that solid business case.”

MacLean said Alternatives North is sharing its findings with parties who might be interested in building the system. The group is also continuing to investigate the economics of potential system expansions.

The biomass district heating system would be a great step toward reducing territorial emissions, according to MacLean, but it’s only part of the solution. If the project were to be built, it would only reduce territorial emissions by one percent, he said. “That is the scale of the problem.”

“This is absolutely what we need to do, and it’s only the beginning,” he said. “It has to be only the beginning.”

This article is produced under a Creative Commons CC BY-ND 4.0 licence through the Wilfrid Laurier University Climate Change Journalism Fellowship.