Why Do Overhead Power Lines Cost So Much in Alberta?

In follow up to the recent Hydro Quebec survey which found Alberta’s power bills to be among the highest in Canada and North America (Edmonton Journal), why are Alberta power bills so high?

Electricity experts have indicated that the Alberta Government’s deregulation of the electricity market in 1996 is one of the major reasons. Experts also point to the high cost of overhead high voltage transmission lines and the construction of so many lines that are unnecessary.

RETA towers many photoTransmission companies such as AltaLink are building overhead lines at an unprecedented rate in Alberta: large 500kV lines like the Heartland Transmission Project and the Western Alberta Transmission Line (WATL), many lines in the Foothills and Southern Alberta Areas (AltaLink News Release), a new 138kV line from the Heartland line to Cooking Lake, and the list goes on. It almost appears as if AltaLink is trying to ensure that every Albertan will see at least one – and in many cases, several – overhead high voltage transmission lines from their home.

The costs of AltaLink’s overhead lines are going through the roof. The cost of the Heartland line has almost doubled since the first estimates. The Western Alberta Transmission Line (WATL) tab recently jumped by $200 million over that approved by the Alberta Utilities Commission (AUC) (Edmonton Journal). Companies like AltaLink repeatedly tell us overhead lines are so much less expensive than buried lines. This is not the case (see this link for comparative costs of overhead and buried high voltage lines).

RETA Heartland transmission project logoRETA has been contacted by many of its members who have watched the Heartland line being constructed, and point out the following (all of which add to the cost of overhead lines):

1. AltaLink and its parent company, SNC-Lavalin, have been using helicopters extensively during construction. As most people are aware, helicopter charter rates are very high.

P10605402. Cranes have been used extensively during construction and are expensive pieces of equipment.

3. Considering the heights that workers have to work at, they must work slowly for safety reasons, which has added significantly to the overall construction time. Labour costs are high. A new pipeline that is currently under construction very close to the Heartland line, is being completed at a much faster rate. Burying the Heartland line would have required significantly less labour and materials.

4. Significant extra labour and materials are required wherever the lines (conductors) are strung across roadways. People driving by the Heartland line have noticed all the extra wooden poles and cross poles that have been erected to keep the high voltage wires above road level as they are being strung. Once the Heartland line is completed, this infrastructure must then be removed, again adding to the labour costs.

5. An amazing amount of concrete was used for the foundations of the lattice and monopole towers. Lattice towers required 4 foundations each, and some of the monopole towers had 30-metre-deep foundations poured (according to AltaLink’s application to the AUC). As most people are aware, concrete is very expensive.

6. Lattice and monopole towers are made of steel. As most people are aware, steel is very expensive, especially when you consider that some of the Heartland towers are 253 feet tall, taller than any other high voltage towers in Alberta.

Mario Beauregard-Montreal Québec CanadaAs well, and as has been suggested by the Industrial Power Consumers Association of Alberta, Montreal-based SNC-Lavalin, which is building and managing the building of the Heartland line, has been known to “wolf-pack” (stacking more people on a project than are required) (see this link).  If such is the case with the Heartland line, this would obviously add to the overall cost of the line.

Many people and associations have raised serious concerns about the high costs of AltaLink’s overhead lines and the overruns in initially-budgeted costs. The Industrial Power Consumers Association of Alberta has pointed out there are no cost controls in place (Edmonton Journal) for the building of high voltage power lines in Alberta. Joe Anglin, the RETA Wildrose logo 3Wildrose electricity critic,  made the following comments about the escalating costs of the WATL, “This line is outrageously expensive. This is not the end. This thing is still going to go up in price…What we’re building now is a multi-billion dollar clothesline that we may or may not ever use and that is actually scary.” (Mountain View Gazette) Anglin also pointed out we’re currently using only 800 megawatts/day of the 2,200 megawatts of electricity capacity already existing between Edmonton and Calgary. He said, “So you can see we’re underutilizing the existing lines as they sit today.” 

RETA dollars in money bag imageIn summary, as AltaLink reports higher profits (Calgary Herald), consumers continue to pay higher electricity costs. But as James Rasmussen of Camrose indicates in his letter to the Edmonton Journal, owners of the new transmission lines don’t care how much the lines cost because their future revenues are a guaranteed percentage of the cost of the lines – paid by consumers – and lasts for the lifetime of the lines.

~ by RETA on December 13, 2013.

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