Why The Diesel?

Over the last few days we have been asked by a number of people why we are burning so much diesel in Dawson City. While we have for the last few years had to burn a certain amount of diesel in Dawson to meet the demand, we are burning more this winter than usual. How much more? In 2008 we burned approximately 119,000 litres of deisel on the Mayo-Dawson grid. In 2009 we burned 138,500 litres. By the end of December of this year we expect to have burned 550,000 litres.

To help put that into perspective, a B-train typically carries 47,000 litres of fuel, so the 2010 diesel consumption in Dawson will likely amount to about 11 B-trains worth of fuel.

There are a couple of reasons why we are burning more diesel this year. The Alexco mine is now a customer, using approximately 1.5 megawatts of power. The hydro plant in Mayo is, under normal circumstances, able to produce up to five megawatts of power. Any demand beyond that must be met with diesel. Even without the Alexco mine on line, there have been times when we haven't had enough hydro to meet the power needs of our residential/commercial/government customers. That's when we've had to turn on the diesels. With Alexco in production, the diesels are working even more.

In addition, some ice formations on the Mayo River are forcing us to reduce our flow through the Mayo hydro generators. Currently we can only produce four megawatts of hydro instead of the usual five. Less hydro capacity means more diesel burned.

Yukon Energy certainly doesn't like having to burn diesel. This situation highlights how important Mayo B and the Carmacks-Stewart Transmission Line projects are. The new Mayo plant will give us 10 megawatts of additional hydro. It should be in service by the end of 2011 or early 2012. The Carmacks-Stewart line, with an expected in-service date of May 2011, will allow us to manage our transmission grids as one integrated system, meaning we will have the ability to send surplus hydro from one part of the system to another and we will need to rely less on diesel.

Even when these two projects are completed we will have much more work to do in our quest to become diesel-free. That is why we are working so hard to find new sources of clean energy, including geo-thermal, wind, waste-to-energy, and additional hydro.

The other important piece is Demand Side Management, also known as energy conservation. We hope to roll out a comprehensive Demand Side Management program next year that will address ways that Yukon Energy can be as efficient as possible, and ways of helping our customers conserve power and save money. In the meantime, we ask that you be aware that we are burning diesel and use your electricity as wisely as possible.

One final point: some Yukoners have labeled our mining customers 'the bad guys' in all this, saying that we wouldn't have to burn diesel if it weren't for the mines in operation. It's important that you realize that there is growth on the system from all customers and not just industrial customers. Remember what a busy construction season Dawson City had this past summer and fall? All those new buildings require power.

Also, Yukon Energy has an obligation to serve. That means that as long as a customer pays the costs of hooking up to our transmission system, we must supply them with power, no matter if they are one household or a mine. You should also know that the mines pay more than 100 percent of the amount it costs us to provide them with electricity, so they are not getting a 'free ride' as some have suggested. In addition, the Minto mine paid $7.2 million towards the cost of the Carmacks-Stewart line, which Yukoners will benefit from for many years. In the case of the Alexco mine, our agreement with them (which is currently being reviewed by the Yukon Utilities Board) sees them paying an additional $7,300 per month for as long as they buy power from us. That money is to be used to help pay the on-going costs of our Mayo to Keno transmission line.