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Great Lakes Article:

Dam nears final hurdle
Feds kick in $300,000 for technical study of Hydro mega-project
By Dan Lett and Paul Samyn
Winnipeg Free Press
06/19/03


The proposed $5-billion Conawapa generating station is poised to clear its final major hurdle.

The federal government has joined Manitoba and Ontario to fund a detailed technical study of the proposed hydro mega-project.
The study could lead to a lucrative agreement to sell Manitoba energy to Ontario.

Premier Gary Doer said yesterday an agreement on the detailed study was close at hand and is expected to be revealed at a news conference tomorrow. Doer left a media scrum on the resumption of the legislature to attend a briefing with Manitoba Hydro CEO Bob Brennan and senior members of Manitoba's federal-provincial relations secretariat, where the tri-level deal was discussed.

Federal sources confirmed Ottawa will contribute $300,000 to the $1-million study, with the two provinces making up the remainder.
The federal government's participation in the study is a major victory for Manitoba and Ontario, both of which have asked Ottawa to fund construction of a $1-billion transmission line to take Manitoba electricity to Ontario's industrial heartland. The federal Liberal government has not committed to any of the transmission line costs, but its involvement in the study is the clearest signal to date that there is formal interest in the project.

A Natural Resources Canada official said the federal government's involvement is part of Ottawa's commitment under the Kyoto Accord to work with the provinces to reduce greenhouse gases.

"We are committed to work with the provinces and territories to contribute to electricity transmission and to explore also economically competitive sources of electricity," the official said.

Said another federal official: "The study is to look at the case for the transmission of hydro from Manitoba to Ontario."

The federal involvement in the Manitoba-Ontario hydro deal comes as a Senate committee yesterday released a report warning of the dangers of climate change and the importance of investing in renewable sources of energy like hydro.

The NDP government has been looking for a way to jump-start the mothballed Conawapa project since it was returned to office in 1999. Doer made hydro generating construction a major theme of his recent re-election campaign. The NDP energy policy got a major boost in late April when the Ontario government pledged in a Speech from the Throne to pursue a power sale with Manitoba.

Manitoba Energy Minister Tim Sale said in early May the two provinces had completed a preliminary feasibility study, which attempted to roughly update the cost of the project based on the design and cost estimates produced in the early 1990s when Conawapa was first proposed. The preliminary study adjusted the original project costs for inflation, but did not provide an accurate and up-to-date picture of what it would cost today to build Conawapa.

The detailed study would more accurately update the costs of the dam while also providing estimates for various transmission line options.
A completed power sale would mark a stunning comeback for the massive Conawapa project.

In the early 1990s, Conawapa looked like a sure thing after Ontario agreed to purchase 1,000 megawatts of electricity from Manitoba.
However, the deal fell through when Ontario pulled out. Ontario eventually paid a cash penalty to Manitoba for its decision not to proceed.

The Tory government of the day decided against proceeding with the project without a confirmed power sale.

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