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Residents get a look at new heating costsCost for heating with synthetic natural gas to be $37 per gigajoule; current cost is $19.30 per gigajoule
Northern News Services
Published Thursday, Sept. 27, 2012
Held in the community hall of the Midnight Sun Complex, the meeting was a chance for residents to get the answers they'd been looking for and to gain more insight into what the mid and long-term solutions for the Inuvik's energy needs.
The cost for heating with synthetic natural gas – a mixture of air and propane – is expected to cost consumers $37 per gigajoule, compared to the current cost of $19.30 per gigajoule for natural gas.
The price is not set in stone yet. It still needs to go to the Public Utilities Board. Sixty days notice has to be given for any rate increase, giving time to file formal complaints. The new rates should be in effect by December of this year.
The majority of the cost – $28.73 – is related to the cost of propane and delivery. The remaining $8.27 is for Inuvik Gas operations, maintenance and safety costs for keeping the Ikhil well functional and accessible.
The almost doubling in cost was one of the most discussed issues of the night.
"The price is not workable," said Dave Kaufman, a resident and business owner. "What happens when I can't pay my bills in December? I'm going out of business, probably, because there will be no disposable income left in this town."
The meeting was moderated by Mayor Denny Rodgers, who said the gas situation has consumed the last six months of his life.
"I wish there was another solution but I don't have it," he said.
The panel answering questions from the public was made up of Mike Burns with the territorial Department of Public Works and Services; Mike Dever, senior vice-president and general manager of ATCO; Colin Nikiforuk, general manager of Ikhil Joint Venture; Kevin MacKay, general manager of Inuvik Gas; and Gerry Roy, chief legal officer of the Inuvialuit Petroleum Corporation.
In 2010, one of the two Ikhil wells was shut down after it flooded with water, making the natural gas unusable.
"It was the K35 well that watered out," said Roy. "In March 2011 we tried to repair it, it was not successful.
"The reserves were less than anticipated; water means the gas is not recoverable. Ikhil can no longer provide long term natural gas."
The Ikhil well has a 90 per cent probability of lasting until summer 2013 assuming a few factors, said Roy. One of those factors is 75 per cent of the town's consumption comes from synthetic natural gas, and that natural gas is only used when there are road closures and trucks delivering propane can't make it up the Dempster Highway.
Buildings and houses heated with natural gas will be seamlessly switched over to synthetic, which is supposed to act the same and doesn't require any investment for conversion, unlike when residents switched from diesel to natural gas.
"There's no action required for a system switch," said MacKay. "We are testing the system as we go and trying to address site specific concerns as we go."
The synthetic gas has been odourized, making it easier for people to detect leaks.
"We're ready for the heating season," said MacKay.
Some residents remain concerned about safety, saying they're not sure the synthetic natural gas will be as seamless as what they're being told.
First-time homeowners Matt Millett and Stephanie White recently found their hot water tank charred and burnt. Concerned it might have been caused by the switch to synthetic gas, Millett called Inuvik Gas's emegency number. Upon investigation, an Inuvik Gas representative told them it wasn't the fault of the gas but instead the appliance.It flared up again the same day, and Millett said he's getting the runaround trying to figure out what caused the problem.
Mario Lemieux, owner of Rocky's Plumbing and Heating, said more has to be done to tell people what's normal and what's not.
"We're trying this thing out. It's September and it's going to be cold in a month," he said. "They can't tell you if it's a good flame or a bad flame. Everyone is pissed off that they're paying double but what these people need to know is what's normal. Put an end to the scare."
MacKay said in the future they'll try to be more communicative, posting test dates around the community and letting people know what some of the differences are, like more of an orange glow as opposed to blue on a gas stove.
Before a long-term solution is found for energy supplies, Nikiforuk said additional propane storage will need to be found for 2013 and beyond.
"Adequate propane storage is estimated at $13.8 million," he said. "We're working with the GNWT and Town of Inuvik for funding options."