Power Struggles: Energy Security and Equality in Canada

Tara Sackett

Interest by remote Indigenous communities in Canada for building alternative energy systems – including renewable projects such as run-of-river hydro and wind, but also systems such as wind-diesel hybrids or combined heat and power – has been increasing in recent decades. “Off-grid” communities, which are not connected to the main electricity grid, may be particularly interested in alternative sources of power. Most off-grid communities use diesel to power electrical generators – but diesel produces pollutants and particulate matter, the generators are noisy and unreliable, and there is a risk of spillage when transporting diesel to remote communities, especially if the roads are poor.

In Ontario, some northern Indigenous communities are so remote that they require diesel to be flown in, resulting in costs that are 5-10 times higher than producing conventional on-grid electricity (although electricity costs are subsidized for consumers). The likelihood of successful economic development in these areas is therefore limited for industries requiring a moderate amount of reliable electricity. And of the 292 off-grid communities in Canada, over half (170) are Indigenous – making energy security an equality issue, too.

Potential for Power

There are various ways for remote communities to access more reliable power, ranging from connection to the main grid, to the development of small alternative energy systems, or the development of large energy systems that provide power and feed into the main grid to gain feed-in-tariff revenue, such as in British Columbia and Ontario. The economic potential of large alternative energy systems has been recognized by communities, the federal and provincial governments, and the private sector. The business models for these projects vary – from community ownership of the project (in part or in full), ownership by a provincial electrical utility, or ownership by a private corporation outside of the community.

Interviews with members of Indigenous communities indicate that there is a well-founded distrust within some communities of outside economic development as a result of previous and current resource exploitation. Resource development on Indigenous territories in Canada has historically featured a lack of consultation, equitable partnerships, or financial partnerships with local Indigenous communities. The exploitation of many communities by companies and provincial governments for hydro development in the 20th century is well documented, for example in provinces such as Saskatchewan, Manitoba, and Quebec.

Yet Canada’s Indigenous communities are increasingly gaining more control over economic development in their territories. This shift is partially due to a formal constitutional recognition of Indigenous and treaty rights, and accumulating Supreme Court decisions on Indigenous title to land, from Calder v BC in 1973 to Tsilhqot’in Nation v BC in 2014. However, Indigenous communities also navigate significant institutional and governance roadblocks for any land management or economic development initiative on reserve lands. For example, the Indian Act requires Ministerial approval for land transactions and stipulates that reserve lands cannot be mortgaged, limiting the ability of communities to acquire project financing. Within this complicated social and regulatory framework, the successful facilitation of community-led development of alternative energy systems depends heavily on the design of public policy initiatives.

A Plethora of Policies

Federal and provincial grants and programs to support alternative energy development programs have burgeoned over the last decade. In BC alone in 2012, there were programs (for either Indigenous or non-Indigenous communities) delivered by five federal Ministries and agencies, four provincial Ministries and agencies, and eight NGOs. For Indigenous communities in particular, there were five federal Aboriginal Affairs and Northern Development Canada programs, one program delivered by the BC Ministry of Aboriginal Relations and Reconciliation, and five delivered by NGOs.

Individual energy development projects, even simple ones, may be funded through a dozen or more different programs or agencies. For example, a relatively small community solar project by the T’Sou-ke First Nation in BC – consisting of a conservation program, solar hot water heaters for 38 homes, and a 75 kW capacity solar photovoltaic system – received funding from 16 different sources.

Indigenous communities’ experiences with, and desires for, the development of alternative energy systems are beginning to be more widely documented. In general, early information-gathering costs, such as community energy baseline studies and/or feasibility studies, seem to be well funded. But ongoing challenges include obtaining capital funding and the lack of community capacity (technical, financial, and social) needed for navigating the complex process of developing community-owned energy projects.

While it is too early for a quantitative analysis to ascertain policy outcomes, my back of the envelope calculations indicate that the federal ecoENERGY Program funded 46 projects in BC for feasibility and energy baseline studies before 2011. Yet funding announcements from BC’s First Nation Clean Energy Business Fund indicate that only five grants for capital costs (construction and operation of a project that is at least partially owned by the community) have been awarded since 2011, as opposed to 19 revenue-sharing agreements with Indigenous communities from the rental of their land for energy projects, and 88 grants for feasibility studies. This would seem to indicate that community-owned projects are very rare, and/or slow to get to the construction phase.

The differing timelines, requirements, and application processes of programs from federal and provincial jurisdictions make applying for funding for the development of alternative energy systems in Canada’s many remote Indigenous communities a task that requires unreasonable time and resources – particularly for a small community. A more systematic design and coordination of policies and programs, in consultation with Indigenous communities and leaders, is required to address the particular barriers at each project stage and to make these programs accessible. This presents an ideal opportunity for the federal and provincial governments to work together to help shift the balance of power to Indigenous communities to support community-based solutions.

Tara Sackett is a 2016 Master of Public Policy candidate at the University of Toronto’s School of Public Policy and Governance. She previously obtained a PhD in Natural Resources Science from McGill University in 2007, and prior to attending SPPG worked as a researcher exploring how aspects of global change affect ecosystem processes. Her main areas of policy interests include climate, energy, and environmental policy.