Fort Simpson moves toward dropping diesel for LNG

A project to move Fort Simpson from diesel power generation to liquefied natural gas, partly funded by the federal government, is now close to moving ahead.

The village is currently powered by four NWT Power Corporation diesel generators. The proposed liquefied natural gas – or LNG – plant is seen by the territory as a step toward its 2030 emissions reduction target.

The NWT has pledged to cut greenhouse gas emissions by 30 percent (compared to 2005 levels) before the end of the decade. In its plan setting out how that will happen, the territory states it will try to reduce communities’ emissions from diesel power by 25 percent in that time.

Doug Prendergast, a spokesperson for the NWT Power Corporation, said an LNG plant in Fort Simpson would be expected to meet that 25-percent reduction target.

“The key driver for constructing this LNG plant is really about reducing greenhouse gas emissions,” he said.

Liquefied natural gas is still a fossil fuel. While its environmental merits as a fuel source are debated, LNG emissions are significantly lower than those associated with diesel.

Village councillors and power corporation staff are discussing where the new plant may be built. On December 21, the village formally granted a development permit for the project.

Prendergast said some logistics are still to be resolved and remaining approvals must be sought before work can get under way. There is no published timeline for the project’s completion.

The new plant, he said, should prove slightly more reliable than its predecessor, which is set to remain available as a backup option.

According to the power corporation’s website, up to 15 percent of Fort Simpson’s power currently comes from a solar array installed in 2012. The rest is diesel.

Struggles with the existing plant

Fort Simpson’s mayor, Sean Whelly, welcomes the new plant – particularly as the diesel plant sits uncomfortably close to an eroding riverbank.

Prendergast agrees erosion is a concern. The diesel generators may be moved to the LNG plant’s location, wherever that may be, he said.

While work to finalize a location is ongoing. Whelly said a lot in Fort Simpson’s industrial subdivision, adjacent to Jimmy Isaiah Drive, is one possibility.

Finding an elevated site for the LNG plant is a priority, said Whelly, so residents don’t have to fear loss of power during floods.

“That was always part of our emergency planning every year: if the water got to a certain point, the entire power plant had to be shut down,” he said.

“Having the plant on top of the hill would mean at least all the power from the top of the hill back towards the airport could continue to run.”

Rates likely to remain the same

Prendergast says a new plant is not likely to noticeably change the rates Fort Simpson residents pay.

“The ongoing operation of a LNG plant tends to be lower than a diesel plant. There will be some savings there on an annual basis,” he said.

“However, there’s also the capital costs that need to be paid.”

In 2019, the project received more than $11 million in funding from the federal government.

While that covers 75 percent of the expected cost, Prendergast said the remainder must come from the power corporation – and its customers.

“Between the capital costs and the potential slight savings in operating costs, it probably works out to be about the same,” he said.