Northwest Territories Biomass Energy Strategy - Gov

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Northwest TerritoriesBiomassEnergyStrategy20122015

3NWT Biomass Strategy 2012 - 2015

Message fromthe MinisterImpressive progress has been made in the use of biomass energyin the Northwest Territories (NWT) during the past several years.The Government of the Northwest Territories’ (GNWT) on-goingsupport for the development of biomass energy has been guidedby the NWT Biomass Energy Strategy released in 2010.The NWT Biomass Energy Strategy 2012-2015 maintains thismomentum and helps bring biomass energy to the forefront ofthe shift for increased renewable energy use in our communities.Biomass energy in the form of wood fuels has a long tradition inNWT culture. It remains an important source of energy for manynorthern communities. The potential for biomass to help achievetangible results in reducing dependence on fossil fuels andreducing our greenhouse gas emissions associated with energyuse in the North has been proven.This Strategy outlines a balanced approach to biomass energydevelopment and supports government, business, individualand community efforts to reduce energy costs, decreasegreenhouse gas emissions and develop a local, renewableindustry.The NWT Biomass Energy Strategy 2012-2015 builds on ourprogress in establishing biomass as an integral part of the NWTenergy mix and a key component of reducing greenhouse gasemissions.J. Michael MiltenbergerMinisterEnvironment and Natural ResourcesNWT Biomass Strategy 2012 - 2015i

iiNWT Biomass Strategy 2012 - 2015

Table of ContentsPurpose . . . . . . . . . . . . . . . . . . . 1Goals . . . . . . . . . . . . . . . . . . . . . 1Objectives . . . . . . . . . . . . . . . . . . 1Forests, Energyand Our Environment . . . . . . . . . . 2StrengtheningGovernment’s Role . . . . . . . . . . . . 3GovernmentLeading by Example . . . . . . . . . . . 4Effective Policiesand Programs . . . . . . . . . . . . . . . 6Ensuring Economicand EnvironmentalSustainability . . . . . . . . . . . . . . . .7Supporting Industryand Market Development . . . . . . . 9Biomass Energy Availability . . . . . . 10Forest Industry Opportunities . . . . . 11Partnerships That Work . . . . . . . . 12NWT First Nationsand Communities . . . . . . . . . . . . 13Industry and Business . . . . . . . . . 14Reviewing Progress . . . . . . . . . . . 14Appendix A –Summary of Actions . . . . . . . . . . 15Appendix B –Summary ofBiomass Support Programs . . . . . . 16Back cover, bottom left: Pellet boiler firebox, Yellowknife Combined Services Building –Photo Credit: City of Yellowknife and AE Associated EngineeringNWT Biomass Strategy 2012 - 2015iii

ivNWT Biomass Strategy 2012 - 2015

PurposeObjectivesThe NWT Biomass Energy Strategy 2012-2015 builds onprogress gained in the development of biomass energy in theNorthwest Territories (NWT) during the past two years throughthe implementation of the NWT Biomass Energy Strategy2010. It serves as a tool for the Government of the NorthwestTerritories (GNWT) to lead and coordinate actions promotingthe creation and use of biomass energy in the NWT.Actions contained in the Strategy are designed to achievethe following measurable results towards the developmentof biomass energy, related economic opportunities andenvironmental sustainability: Increase the use of biomass fuels, such as cord wood,wood chips and pellets, in all segments of the NWTspace heating market. Achieve measurable life cycle greenhouse gas emissionreductions by using biomass to offset fossil fuels. Create lasting economic benefits and providing costsavings in energy use, employment and businessopportunities in the supply and distribution of biomassproducts and services. Ensure increased use of biomass fuels and forestresources is sustainable, with full consideration ofthe long-term health of the forest landscape and theresources and values it contains.GoalsThe Biomass Energy Strategy 2012-2015 enables the creationof conditions for biomass to become an integral part of a moresustainable energy mix for the NWT by: establishing effective government policies and programs; supporting private sector innovation and initiative indeveloping biomass energy markets; and building strong partnerships with communities,First Nations, other levels of government and theprivate sector.Southern Northwest Territories forest – Photo Credit: ENR/GNWTNWT Biomass Strategy 2012 - 20151

Forests, Energy andOur EnvironmentBiomass energy is any energy derived from a biological source,such as wood, agricultural crops, wastes or municipal solidwastes.In the NWT, the most common type of biomass used toproduce energy is wood. Wood fuels provide significant energycost savings to NWT residents, businesses and institutions.Greenhouse gas emissions associated with northern heatingrequirements are reduced by supplementing fossil fuels withwood. The economic opportunities of developing local capacityfor producing biomass fuels are now apparent.Biomass, in the form of cordwood, was estimated to be aboutsix percent of total space heating energy demand in 2007.The use of cordwood has remained relatively stable since then.Consumption of wood pellets, purchased in Alberta and BritishColumbia, has grown dramatically to provide approximatelyfive percent of total space heating needs. These developmentsrepresent a substantial shift in the way the NWT meets its energyneeds and views its energy sources.Cordwood is almost entirely used for home heating. The useof wood pellets is split between residential, commercial andinstitutional segments of the market and is mainly concentratedin communities connected to an all-season road system.Forests have always provided a renewable source of energy forheating, cooking and as a resource for many other goods andnecessities. Wood pellets are now becoming a common fuelin our communities. There is considerable economic potential forincreasing the use of pellets and other forms of wood. However,increasing reliance on NWT forest resources for energy needsmust be balanced with other forest uses and the ecologicalbenefits of forests.The use of biomass fuels derived from forest resources is growingas prices for conventional fuels continue to increase and awarenessof impacts to our climate and environment caused by greenhousegas emissions grows. Biomass energy is recognized as beingpart of the solution to reducing greenhouse gas emissions, whilepotentially providing a substantial portion of our energy needs.Greenhouse gas emissions associated with biomass energy arequantified based on a net change in forest carbon stocks overtime. Forest management practices in Canada and the NWT aredesigned to ensure a net zero change in carbon stocks in ourforests by ensuring harvested trees are replanted to reabsorbcarbon dioxide released from the wood during combustion forenergy production.The GNWT recently commissioned a comparative life cycle analysisstudy for emissions from heating oil and biomass fuels consumed inthe NWT. The study, done by the Saskatchewan Research Council,provides a better understanding of the associated emissions,including emissions from fossil fuels used to power harvesting,processing and transportation equipment in the forestry sector. Thecomplete study can be found on-line at www.nwtclimatechange.caBiomass development highlights the relationship between forests,energy and the environment. Appropriate planning and measuresto ensure biomass development takes place responsibly andsustainably can ensure the use of biomass fuels in building a moresustainable energy future for the NWT.Cordwood6%Wood pace Heating23%Diesel, Natural Gasand Propane89%Industry38%NWT total energy use 2009-2010 (total 18,700,000 GJ)Source: Northwest Territories Energy Report, May 20112NWT Biomass Strategy 2012 - 2015Estimated biomass share of NWT space heating demand 2010-2011Source: ENR estimates based on supplier survey data (2011)

StrengtheningGovernment’s RoleBiomass is used by the GNWT to heat public buildings. Programsare now in place to support biomass development and communityled biomass projects initiated in the earlier version of the NWTBiomass Energy Strategy. This support has helped to make theNWT a leader in the deployment and use of biomass technologies.Tom Lakusta, Manager, Forest Resources, ENR speaking at a regional biomass workshop heldin Fort Good Hope in May 2011 – Photo Credit: ENR/GNWTLog deck, southern NWT – Photo Credit: ENR/GNWTNWT Biomass Strategy 2012 - 20153

Government Leadingby ExampleThe GNWT is making biomass an integral part of the NWTenergy mix by supporting the economic opportunities ofincreased production and use of biomass energy sourcesfor the benefit of residents, businesses and communities.Action 1:Increase Use of Biomass to Heat PublicBuildingsThe Department of Public Works and Services (PWS) plays apivotal role in demonstrating the economic benefits of usingbiomass through the installation of wood pellet boilers tosupplement oil heating in public facilities.In the past five years, PWS commissioned 11 biomass heatingsystems. Three more are currently under construction. Theseinstallations displace more than 2.4 million litres of heating oil andreduce more than 6,500 tonnes of greenhouse gas emissions ayear. This represents about 16 percent of the GNWT’s heating fuelconsumption. Future projects will add to this accomplishment andfurther demonstrate the benefits of biomass energy.This work has helped create consumer confidence in pellettechnology and has generated a core market for wood pelletfuels, products and services. It provides opportunities for localbusinesses in the supply and distribution of pellet fuels andgenerates investment and increased capacity for related technicalservices and expertise.The results of these developments have benefitted othersegments of the heating market and provided a new renewableheating source option for consumers. The GNWT is building onthis progress by expanding its use of biomass for heating publicbuildings, growing existing markets and creating new markets.2,404,751 L2,500,0001,885,742 L2,000,000EstimatedHeating Fuel Oil Displaced (L)3,000,0001,374,979 L1,500,000857,754 L1,000000568,904 L586,590 LEnd of 2007End of 2008500,00004NWT Biomass Strategy 2012 - 2015End of 2009End of 2010End of 2011End of 2012

Action 2:Action 3:Examine Potential for Integrating Biomassin Public HousingExamine Models for Supply and Distribution ofBiomass Fuels in all CommunitiesThe Northwest Territories Housing Corporation (NWTHC)can benefit from expanded use of biomass heating for publichousing. The Corporation has about 2,300 public housingunits. The potential for expanding the use of biomass heatingin public housing will be examined in consultation with industryexperts, the Arctic Energy Alliance (AEA) and other governmentdepartments.Private sector investment in wood pellet transportation,storage and distribution infrastructure and operations occurswhen there is enough demand for the product.The greatest use of biomass heating is expected to be bestapplied to large housing complexes using either an independentbiomass heating system or a district distribution biomass systemtied to other public buildings. The potential for district distributionsystems may also apply in communities with dense or clusteredareas of public housing units.The NWTHC’s Contributing Assistance for Repair andEnhancements (CARE) program provides eligible clients withassistance for energy efficient upgrades. There may be potentialfor private homeowners to implement biomass heating throughthe CARE program. Installations of wood stoves, pellet stoves and,possibly, larger biomass heating may be partially or fully coveredunder CARE. The CARE program requires an application process todetermine eligibility.Many NWT residents have installed wood pellet stoves or highefficiency conventional wood stoves during the past few yearsusing rebates from the Energy Efficiency Incentive Program (EEIP).Pellet boiler installation at Sir John Franklin High School, Yellowknife –Photo Credit: Arctic Energy AllianceThis has already happened in communities where PWS becamean “anchor customer” by installing boilers in public buildings.It created enough demand, and pellets became commerciallyavailable for residents and small businesses. This model worksin many of the larger, southern communities. However, there isstill no commercial supply of pellets in most NWT communities,especially those not on an all-weather road system.The AEA is working with ENR to identify potential clusters ofbuildings which could be converted to wood pellet heatingsystems. This would build market demand and triggercommercial supplies of pellets. This work also providesinformation on the necessary infrastructure and deliverymodels, such as barge or winter road transportation.Other options for generating investment in supply anddistribution services include community governmentinvestments or the wood marshalling yard model.A wood marshalling yard is a market that buys wood fromvarious harvesters and then distributes it to a broader market.In some communities, this may be an opportunity to developa local supply of cured firewood. Other communities may havebroader commercial interests in producing sawlogs, woodfor pellet production or wood chips for local consumption. Amarshalling yard can provide a stable year-round market forharvesters, a supply of timber for consumers requiring highervolumes of wood and local employment opportunities.Pallets of bagged pellets ready for shipping – Photo Credit: ENR/GNWTNWT Biomass Strategy 2012 - 20155

Effective Policiesand ProgramsThe GNWT supports biomass development throughvarious policies and programs, which provide a frameworkfor the uptake of biomass products and services. Effectivepolicies and programs are essential in achieving the goalsof this Strategy.The existing framework supporting the Strategy includes theSustainable Development Policy, the Greenhouse Gas Strategyfor the NWT and the NWT Energy Plan. This frameworkprovides principles to guide resource development andidentifies biomass as a key component of sustainableenergy and greenhouse gas mitigation for the NWT.One of the goals of the NWT Greenhouse Gas Strategy2012-2015 is to increase biomass heating capacity inresidential, commercial and institutional sectors by100 percent by 2015. This would represent about 30percent of the NWT’s total space heating demand. Thecurrent proportion of biomass energy in the NWT’s spaceheating market is about 14 percent and includes cordwoodand wood pellets (9% cordwood and 5% wood pellets).Action 4:Promote Biomass Programs to Residents andSmall BusinessesThe existing Energy Efficiency Incentive Program (EEIP) has beensuccessful in supporting conversions to biomass systems, such aswood pellet stoves in homes, by providing rebates to consumers.This success highlights the trends in the growth of wood pelletconsumption. Rebates for larger wood pellet boilers and furnaceswere transferred to the Alternative Energy Technology Program(AETP) in 2012. This program provides more assistance withthe costs of installing these systems than the EEIP. Communitybiomass initiatives have also been a focus of the AETP’s CommunityRenewable Energy Fund (CREF) and the Energy ConservationProgram (ECP).Promoting these programs and increasing support for individuals,businesses and communities to access them and the technicalservices required for small to medium-scale biomass installationswill ensure the programs remain effective.AEA will continue to play an active role in providing technicaladvice and information on potential cost savings to residents, smallbusinesses and communities from wood pellet, wood chip andcordwood heating systems.All programs can be promoted through community engagement,trade shows and media sources.Action #5:Support Businesses and Communities inImplementing Larger-scale Biomass ProjectsThe GNWT worked extensively with communities and businessesto promote the installation of larger commercial or institutionalbiomass heating systems during the implementation of theprevious Biomass Energy Strategy.Wood pellets, wood chips or cordwood systems can providesolutions on a larger scale. District heating systems can provideheating for more than one building, with a central boiler or heatplant. The cost of installing these systems cannot be covered bycurrent biomass assistance programs, but ENR can assist withdesigning and evaluating proposed systems to determine theeconomic payback that can be achieved by switching from heatingoil to lower cost pellets.Pilot projects done on a case-by-case basis during the past severalyears provided the information needed to bring these types ofprojects on-line. Communities, businesses, local governmentsand First Nations are keenly interested in these projects. Theywill require support through development and implementationphases, including support to explore local harvesting operations,to install their own systems.Wood pellet boiler installation at Chief Jimmy Bruneau School in Behchoko –Photo Credit: PWS/GNWT6NWT Biomass Strategy 2012 - 2015

Ensuring Economicand EnvironmentalSustainabilityAction 6:Expand Forest Inventories in Regions withExpected Increased Forest UseIncreased harvest of NWT forest resources for use as biomassenergy raises concerns about the sustainability and true life cycleof greenhouse gas emissions reductions.Concerns about widespread use and trade of wood pellets andother forest biomass commodities on a global level have led severalenvironmental organizations to recommend limiting developmentof biomass resources to the most efficient uses or ensuring forestharvesting meets a high standard of sustainability to protect forestecosystems, wildlife habitats and biodiversity.Environmental sustainability of biomass development in the NWTis a priority. Decisions and actions by the GNWT will include thecontinued use of sustainability measures and standards in linewith national and international protocols. Work is also underwayto develop management systems to ensure ecological processes,such as the natural forest fire disturbance regime and assessmentsof climate change effects, are all considered.The GNWT recognizes monitoring for healthy forests becomesmore important as harvesting increases in response to greaterreliance on local biomass sources. A number of initiatives areunderway to deal with the energy trade-offs arising when heatingenergy use switches from fossil fuels to biomass. These includetechnical studies and analyses, and community engagement onsustainable harvest practices, forest management and planning.Local cordwood harvesting has remained stable for a numberof years in the NWT. There is also only a small amount ofsawmill activity and all wood pellet fuel is imported from otherjurisdictions, primarily Alberta and British Columbia. This meansany future developments can take place in a well planned andsustainable manner.A balanced and responsible approach to the increased use ofNWT forest resources for biomass energy requires an adequateknowledge base and sustainability measures.ENR supports the development of community–basedsustainable forest activities and projects through forestinventories, community forest planning, harvest methodsand technical support.Forest regeneration in southern NWT – Photo Credit: ENR/GNWTNWT Biomass Strategy 2012 - 20157

Action 7:Action 8:Implement an NWT Forest InventoryTracking System to Inform Sustainable ForestManagement Decisions and ReportingPromote Distribution and Use of Clean BurningBiomass TechnologiesForests cover 70 million hectares in the NWT, and representthree ecozones and more than 100 ecoregions. Humanactivities impacting NWT forests include: land clearing forcommunities and roads; oil, gas and mineral exploration anddevelopment; and harvesting for biomass or other forestproducts.The GNWT is building a digital forest inventory tracking systemto allow natural resource managers to access up-to-dateinformation, including forest inventory results and footprintsof land use activities. This system will allow for responsible andwise stewardship of the forested landscape in the NWT.The use of biomass as a heating fuel has fewer environmentalrisks than the use of fossil fuels. Fuel spills from traffic accidentsor fuel tank leaks can cause significant environmental damage andbe costly to clean up. Fuel spills could be mitigated with increaseduse of biomass.ENR has examined the potential impacts wood smoke frombiomass burning technology and determined air quality impactscan be mitigated by implementing the use of the most efficientand clean burning technologies. EEIP rebates are provided forthe purchase of wood stoves or wood pellet appliances withthe high emission standards established by the CanadianStandards Association and the United States EnvironmentalProtection Agency.Action 9:Develop Guidelines for Regulation of BiomassBurning Technologies by MunicipalitiesParticulate matter levels in the air from wood smoke can be higherin some communities and municipalities due to denser populations,depending on the type of biomass appliances used. The GNWTcan provide guidance to communities and municipalities onregulating or mitigating impacts to air quality from biomass use intheir communities.Southern NWT forest – Photo Credit: ENR/GNWT8NWT Biomass Strategy 2012 - 2015ENR field survey – Photo Credit: ENR/GNWT

Supporting Industryand Market DevelopmentThere are opportunities for businesses and communities toparticipate in the development of the biomass industry andthe growing market for biomass products and services. Theseinclude the supply of biomass resources, the manufacture anddistribution of biomass fuels, retail and services for biomassproducts, and the increasing demand for technical servicesrelated to biomass energy systems.The NWT already leads the country in its capacity to integratebiomass energy systems in built infrastructure based on ourengineering expertise and the creation of distribution services forhandling biomass fuels. These developments are largely driven bythe potential cost savings realized from converting conventional,petroleum-based heating systems to biomass. They also supportthe GNWT’s priorities of reducing greenhouse gas emissions andproviding sustainable energy options for NWT residents.The use of wood pellets has grown from an almost non-existentshare of total space heating demand to an estimated fivepercent of total space heating in just over five years. The currentproportion of biomass energy in the NWT’s space heating marketis about 14 percent when you add the use of cordwood.The potential for further growth in this industry and localmarkets is much greater. One of the goals of the NWTGreenhouse Gas Strategy 2011-2015 is to double the spaceheating requirements served by biomass. This means totaldemand for wood pellets could increase to about 30,000tonnes by 2015.Meeting this goal requires significant investment by the privatesector, an aggressive expansion of biomass availability intocommunities where wood pellets are not currently used, and adramatic increase in the use of biomass in regions with currentaccess to wood pellets. It can be achieved through effectivepromotion of biomass energy and a few large commercial orindustrial users or large bulk customers.A growing market for biomass fuels, such as wood pellets,provides opportunities to shift from imported energy sourcesto energy sources based on local resources.Producing fuels locally to meet NWT demand could generatesignificant economic benefits in terms of employment,investment and new business opportunities.Government support to industry and local governments inareas of biomass fuel production and market development willbe important in maintaining the momentum of the industryand capturing the benefits for NWT residents, businesses andcommunities. Switching to biomass fuels provides cost savingsover heating fuel, with simple paybacks on investments as quickas five to ten years depending on the particular installation.The GNWT’s efforts in these areas will focus on increasingthe availability of biomass energy throughout the NWT andsupporting forest industry opportunities associated with localproduction of biomass fuels.Pellet boiler installation at Chief Jimmy Bruneau School in Behchoko – Photo Credit: PWS/GNWTNWT Biomass Strategy 2012 - 20159

BiomassEnergy AvailabilityThe use of harvested cordwood is common throughout allregions of the NWT. It has been a traditional part of livingin forested northern climates.The use of wood pellets is relatively new to the NWT. Themost common use is in southern regions where all-seasonroad access enables the relatively easy distribution ofpellets. Wood chips and wood briquettes have had someuse, but are not common in the NWT.Wood pellet technology is most common in larger markets,such as Yellowknife and Hay River, where products andservices are available to consumers. Specialized companiesin these centres have invested in distribution equipment.This allows for a wider market to access bulk pellet systemsand increases the cost-saving benefits and convenienceassociated with the use of pellets.The GNWT and the private sector have both supportedthese business operations by installing wood pellet boilersin commercial and public buildings.Arctic Green Energy fuel delivery truck in Yellowknife – Photo Credit: Arctic Energy Alliance10NWT Biomass Strategy 2012 - 2015Action 10:Support Businesses and Communities inDeveloping Biomass Supply and DistributionOne of the goals of this Strategy is to increase the availability ofbiomass energy throughout the NWT. Challenges to be addressedbefore we can achieve this goal include: the supply, distributionand storage needs for ice-road communities and barge-supplycommunities; technical capacity for operation, service andmaintenance of biomass systems; and the higher upfront capitalcost of implementing biomass systems in the NWT.Government can support businesses and communities byextending support to local biomass supply and distributioninitiatives from NWT businesses and communities. The GNWTcan also provide the expert and technical advice and knowledgerequired to plan for these types of investments.ENR has worked with some remote communities to evaluatethe business case for establishing a wood pellet supply anddistribution system and found that the potential market is toosmall to justify the investment needed. Often these communitiesalready use a lot of locally harvested cordwood and it will makemore sense for ENR to help them upgrade woodstoves to moreefficient models and support community initiatives to ensure thatan adequate supply of seasoned firewood is available.

Forest IndustryOpportunitiesThe development of biomass energy means increasedopportunities in the forest industry for NWT businessesand communities.The development of biomass energy and associated forestindustry opportunities can mean greater self-sufficiency inmeeting local energy needs and employment opportunitiesderived from forest-based activities. Jobs associatedwith local wood harvesting can provide much neededemployment in NWT communities.Action 12:Promote Wood Marshalling Yards as a Modelto Support Local Forest Industry Capacity andIncreased Biomass AvailabilityThe GNWT supports communities interested in developingforest industry capacity. The wood marshalling yard conceptis promoted as a model for supply and distribution of biomassproducts, while incorporating and strengthening local capacityfor sawmilling or other forest industry operations.The GNWT can help businesses and communities to assessmarket opportunities, develop viable business plans and meettheir training and capacity needs.Action 11:Support Businesses and communities inDeveloping Forest Industry OpportunitiesThe productive forest areas of the NWT are centred mostlyin the southern regions. This is where any larger-scale forestindustry operations would likely occur. Current demand for woodfuels in the NWT could be easily met within sustainable harvestlevels. The boreal forest in the NWT could sustainably supportseveral significant regional forest industries.Existing or new forest-based operations could also besupported by increased regional demand for biomass feedstock.Community sawmill operations could be enhanced. There isalso an opportunity to authorize an NWT lumber grading stamp,which could open up new markets for northern wood. Lumberwith an approved grade stamp mark can be used for structuralbuilding purposes. There is also untapped potential for moretraditional, log built housing and other structures.Rafe Smith, ENR Coordinator Silvicultural Operations, speaking at a workshop in Fort GoodHope – Photo Credit: ENR/GNWTThere is significant community interest in participating inregional biomass initiatives.Government can support forest industry opportunities bysharing technical expertise in sustainable forest management,harvest planning and inventory data, and assisting localdevelopment corporations and agencies in creating viablebusiness and investment plans.Ground biomass material before pelleting process - Photo Credit: ENR/GNWTNWT Biomass Strategy 2012 - 201511

Partnerships that WorkBiomass energy development crosses many sectors and areasof jurisdiction. Development efforts require the participationof many GNWT departments and agencies, community andAboriginal governments, businesses and federal governmentdepartments and agencies.Partnerships have been important in adding biomass as anintegral part of the NWT energy mix and a climate changesolution. The GNWT has promoted sound biomass optionsand explored a number of biomass supply opportunities.Aerial photo of De

Biomass energy in the form of wood fuels has a long tradition in NWT culture. It remains an important source of energy for many northern communities. The potential for biomass to help achieve tangible results in reducing dependence on fossil fuels and . Ensure increased use of biomass fuels and forest resources is sustainable, with full .

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