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Manitoba-Ontario hydro project moves step closer to reality

Friday, Oct 1, 2004

The vision of using water in Northern Manitoba to power industry in Southern Ontario moved a small step closer to becoming reality yesterday as the energy ministers for the two provinces agreed to a detailed feasibility study of the $5-billion-plus project.

But the federal government will have to contribute about $1-billion to make it a reality.

For Ontario, a major benefit would be using hydro power from Manitoba and Northern Ontario instead of building new nuclear reactors, according to Energy Minister Dwight Duncan.

"This province is going to have to make a decision about [building more] nuclear power," he said.

For Manitoba, the project would bring $3-billion to $4-billion in construction spending, much of it going to natives in the hard-pressed communities in the province's north, according to Energy Minister Tim Sale.

For Canada, the project would establish an east-west electricity grid that would help it develop a policy for national energy security.

"You can't have an energy security policy if you don't have an electricity grid. . . . This would be a very important nation-building project," Mr. Sale said at a news conference in Toronto with Mr. Duncan.

It also would enable the reduction of greenhouse-gas emissions under the Kyoto accord that would be worth at least $1-billion, Mr. Duncan said.

"The project would take pressure off other sectors [of the economy], the manufacturing sector in particular, to cut greenhouse-gas emissions to meet the Kyoto targets," he said.

Alberta also could benefit because some of the 5,000 megawatts of potential generating capacity on the Nelson River could provide power for projects to release petroleum from that province's oil sands, according to the ministers.

The two energy ministers released the results of a 14-month preliminary study of the on-again, off-again project that set out the potential benefits and described the hurdles that would have to be overcome.

They agreed to proceed with a detailed technical study that will include a look at the feasibility from an engineering standpoint, an analysis of the costs, an overview of the economic impact and discussions with first nations, who would be required to approve the dams in Manitoba and high-voltage transmission lines from the Nelson River to Central Ontario.

The transmission lines would cover between 2,000 and 3,000 kilometres, depending upon the route chosen.

They would cost $1.5-billion to $2.4-billion.

Mr. Duncan and Mr. Sale said they hope to work with the federal government to decide within a year whether to proceed with the project. It would take at least eight more years to start delivering electricity to Southern Ontario.

Manitoba and Ontario signed an agreement to proceed with the project in 1989. But Ontario cancelled the pact in 1994 when an economic recession pushed down the demand for power in the province.

But Mr. Duncan said he is working to make the project viable because it would provide 1,500 megawatts from Manitoba at a time when many of Ontario's nuclear reactors will need major, and costly, refurbishing.

The power generated in Manitoba would be the equivalent of that produced by two reactors.

In addition, there is potential for another 3,000 to 6,000 megawatts in Northern Ontario that the province cannot use because there are no transmission lines to take it to markets.

That potential could be used if the transmission lines were built, Mr. Duncan said.

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