Carbon tax, aging grid pose ongoing challenges for SaskPower

SaskPower Minister Gord Wyant and President and CEO Mike Marsh release the SaskPower 2016-17 annual report at the legislature on July 19, 2017. (Sarah Mills/980 CJME)

SaskPower has some big challenges ahead as it continues to meet growth demands, upgrade the grid and meet environmental targets.

The annual report released Wednesday showed the Crown invested $886 million in the province’s electricity system over the past year.

Operating income was $46 million but SaskPower saved $73 million over the last two years in budgeted operating, maintenance and administration spending.

Debt levels will rise as a result of the major capital projects on the go, reaching $7.5 billion.

It also means customers will be paying more.

“For a number years now, we have maintained a consistently moderate approach, four to five per cent rate increases have been the norm, we’ve made a conscious decision to do this,” SaskPower President and CEO Mike Marsh explained. “We’ve done this to keep rate impacts as low as we possibly could and moderate and regular so people can plan for them and businesses can plan for them.”

The introduction of the federal carbon tax will also financially burden SaskPower.

“We wouldn’t be taxed directly but we would see it through increased fuel and purchase costs,” Marsh added.

SaskPower has a number of projects on the go including a new 350-megawatt natural gas fired plant near Swift Current, a 10-megawatt utility scale solar project, up to 200-megawatt of wind generation added to the grid as well as a $300 million life extension to the hydroelectric station.

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