Yahoo Finance Most Canadian homes to average $1,500 per year in energy savings in a net-zero 2050
The Canada Electricity Advisory Council, however, warns low-income households could be disadvantaged
Most Canadian households will save an average of $1,500 per year on energy bills in a net-zero 2050 scenario. That's according to a recent report by a federally appointed panel on the future of the electricity sector.
The Canada Electricity Advisory Council estimates about $1.4 trillion in combined public and private capital investment will be needed to expand and improve the electricity system. Members of the council, appointed by Natural Resources Minister Jonathan Wilkinson, span former executives from public and private utilities, climate researchers, and Indigenous leaders.
As part of its 2050 climate plans, the federal government aims to achieve a net-zero grid by 2035.
The council's final report released last Monday predicts households will experience higher electricity rates, and increased equipment costs for electric heating systems and vehicles. That’s expected to be offset by lower fossil fuel spending, and less overall energy consumption.
“Electricity can be two to four times more efficient than the energy sources it will replace,” the report’s authors wrote. “Canadians can expect to save $15 billion in total energy-related costs, despite a doubling of the rate of electricity-sector investment.”
For 70 per cent of Canadian households, net savings in 2050 are expected to total $1,500 per year on average. However, the report warns “two provinces experience more pain than gain.”
“Households currently heated by natural gas in provinces with higher retail electricity rate projections (most notably Alberta and Saskatchewan) are far more likely to experience higher overall energy costs, partly since these jurisdictions already have high electricity rates,” the authors wrote.
Alberta Premier Danielle Smith issued a statement in response to the advisory council’s findings last week. Her government has said Alberta will work towards a 2050 net-zero target, but the province cannot achieve a net-zero power grid by 2035.
“Alberta is rapidly decarbonizing its grid, but we refuse to gamble with winter blackouts and crippling energy bills,” she stated on June 11. “Ottawa's one-size-fits-all electricity regulations are a dangerous, costly and unrealistic path to failure.”
The Canada Electricity Advisory Council says Ottawa must “ensure sufficient flexibility” in its decarbonization requirements for regions facing “disproportional cost burdens and reliability challenges.”
It also acknowledges the limits of its findings, including the fact that the results do not address business and industry, as well as Canada’s North.
In addition to an uneven impact geographically, the council found low-income households are also disadvantaged.
“While 70 per cent of all Canadian households are expected to see net savings, that number drops to 58 per cent for lower-income households,” the report stated.
“This is primarily because a higher proportion of lower-income households do not own personal vehicles and therefore will not benefit from the savings associated with electrified transportation.”
Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.
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