Thank you, Mr. Chair. That's good to hear, actually. Having that little bit of infrastructure could probably go a long way to serving the coastal communities, and even outside the territory, and outside the country. I appreciate the hard work that they're doing as a department to refine something that was working, but barely working by a shoestring. Other than that, I don't have really anything else for this section, Mr. Chair. Thank you.
Thank you, Mr. Nakimayak. Comment noted. Next, we have Mr. McNeely.
Thank you, Mr. Chair. My question is related to pages 244 and 245. I notice quite a variety of different programs with budget amounts to them. I recall this government in previous Assemblies conducted a geothermal potential study from the many federal low-emission green funding sources. Have there been any discussions with the federal government to secure funding for a pilot project related to the geothermal? Thank you, Mr. Chair.
Thank you, Mr. McNeely. Minister Schumann.
Thank you, Mr. Chair. The short answer is no. A number of years ago, there was a proponent that approached the Government of the Northwest Territories to do something in the NWT, but it didn't turn out to be a viable project. With the technology and with the depths they had to drill, it wasn't viable at that time, but the short answer is no. Thank you, Mr. Chair.
Thank you, Minister Schumann. Mr. McNeely.
Nothing further there, Mr. Chair. That was just one that caught my eye that could be potential cost-savings for our buildings, as well as subsidizing the private sector buildings. Thank you, Mr. Chair.
Thank you, Mr. McNeely. Minister Schumann.
Thank you, Mr. Chair. When you look at our 2030 Energy Strategy, the way that we have laid that thing out, we have our three-year rolling plan going forward. The reason that we have done this is just because of new technologies and things changing out there. More study and more data is needed to better understand the geothermal resources in the Northwest Territories. With that being said, this is a 10-year plan rolled out by the federal government. There may be opportunities to have a look at the geothermal situation in the Northwest Territories. Thank you, Mr. Chair.
Thank you, Minister Schumann. Next on our list, we have Mr. Thompson.
Thank you, Mr. Chair. In regard to fuel services here, I noticed that, when the Minister talked about MTS, there was no budget line, but fuel services has a budget line. Isn't fuel services a revolving fund, as well? Thank you, Mr. Chair.
Thank you, Mr. Thompson. Mr. McCormick.
Thank you, Mr. Chair. Yes, the line for fuel services is related directly to the amortization of the GNWT's assets that fuel services uses.
Thank you, Mr. McCormick. Mr. Thompson.
Thank you, Mr. Chair. Could the Minister explain when our amortization of the tanks are going to be up? Thank you, Mr. Chair.
Thank you, Mr. Thompson. Mr. McCormick.
Thank you, Mr. Chair. I don't have a complete list of the tank farm assets in front of me right now. That equipment amortizes anywhere from 15 to 40 years, depending on the nature of the equipment. They will slowly drop off over a number of years, and as assets are upgraded or replaced, new amortization will hit the budget line. Thank you.
Thank you, Mr. McCormick. Mr. Thompson.
Thank you, Mr. Chair. In regard to fuel services, I have noticed that we have had problems with MTS, given the High Arctic and that, with the smaller communities just recently, i.e., Wrigley. Has the cost gone up, or is it just because of the delivery costs that we have seen increases in fuel in the smaller communities? Thank you, Mr. Chair.
Thank you, Mr. Thompson. Mr. Guy.
Thank you, Mr. Chair. There are a number of factors that go into the price of fuel. There is the actual wholesale cost of the fuel, which fluctuates throughout the year depending on when we buy it. Diesel fuel, as you will note, in the last year has been fairly volatile; it has been up and down. Gasoline, even, has had some variation, as well. That is one component. The other component is the transportation costs for trucking. Trucking costs are a factor, and if that goes up or goes down, depending on market conditions, that can have a factor to play, as well as our community contractor costs. All of our fuel is dispensed in the communities by private contractors contracted by the fuel services division, and in those cases, when those contracts come up and are renewed, sometimes there is an increase in the costs. That can contribute to the fuel costs even though the other components of the cost may be the same.
There are a number of things that go into what determines the final price of the fuel, and those things vary at different times in the cycle. Thank you, Mr. Chair.
Thank you, Mr. Guy. Mr. Thompson.
Thank you, Mr. Chair. Is this information shared? I know that this is the first I have seen about the contracts, but I have seen the other explanation as to why the costs go up. Have I missed the contracts as part of this? This is the first time I have seen it, so I may have missed it. I apologize, but is it there? Thank you, Mr. Chair.
Thank you, Mr. Thompson. Mr. Guy.
Thank you, Mr. Chair. The community dispensing contracts and operating the tank farm contracts come up periodically. Every community is on a different cycle. They are usually two- or three-year contracts. We advertise them publicly. We give contractors in the community an opportunity to participate and respond and submit compliant bids. It depends on what the bid price is that comes in of the successful proponent, which is then factored into the price, and that can trigger a fuel price upgrade.
In some of the communities that are just subject to road delivery, we resupply a community, and there have a different price in the fuel if the price of wholesale fuel goes down or goes up. That can trigger a new price as well. We try to test the prices as soon as we have a new cost component available to input into the pricing. Thank you.
Thank you, Mr. Guy. Mr. Thompson.
Thank you. I appreciate that answer from the deputy minister. I know that, in Wrigley, we had to get fuel from the north part because of our ice conditions. Did that have an increase in the cost, or were we able to keep the cost where it was until we were able to ship in a new supply? Thank you, Mr. Chair.
Thank you, Mr. Thompson. Mr. Guy.
Thank you, Mr. Chair. I don't believe there was any impact on the cost of fuel for Wrigley, bringing it down. I believe we brought it from Tulita or Fort Good Hope on the winter road. That fuel was procured back in the summer and was probably at the same or slightly less of a price than the fuel that we had already planned to bring in through the normal resupply route. I think it turned out to sort of break even when you add the transportation cost to the fuel, but we will have to confirm that. As far as I know, there were no impact on fuel price in Wrigley as a result of that movement. Thank you.
Thank you, Mr. Guy. Mr. Thompson.
Thank you, Mr. Chair. I think you are correct that it didn't. I just wanted to clarify that. The next question I have in regard to fuel supply is the quality of it. Is it the same quality across the North when we resupply the communities? Is the fuel different? I have heard some concerns from constituents, who say, "Well, we get the fuel we get. It costs us X amount of dollars. We only get X amount from our tank." In Fort Simpson, the quality of gas seems to be a little bit different. When we go down south, you get a quality difference. Can you verify that the gas that we provide is all the same? Thank you, Mr. Chair.
Thank you, Mr. Thompson. Mr. Guy.
Thank you, Mr. Chair. The fuel that we provide for the petroleum products or through the fuel services division is of the same quality and standard everywhere in the territory. We have a rigorous testing program in place, where we test it at various points in the supply chain. During its final delivery into the tank farm, into the community, we have a regular testing program as well, to make sure that it meets the specifications that we specified when we purchased it. We do that on an ongoing basis as part of our maintenance and operating plan for the fuel services division. It should be the same quality of fuel in any of our tanks anywhere in the territory. Thank you, Mr. Chair.
Thank you, Mr. Guy. Mr. Thompson.
Thank you, Mr. Chair. My next question is about MTS. We talked about amortization for fuel services, but do we have any amortization for MTS and the stuff that we have purchased? Thank you, Mr. Chair.
Thank you, Mr. Thompson. Mr. McCormick.
Thank you, Mr. Chair. The MTS revolving fund records and discloses its own amortization, so there was no appropriated line in the budget. Thank you.
Thank you, Mr. McCormick. Mr. Thompson.
Thank you. I guess I am confused. When we have fuel services, we have amortization in the budget, and then, when we have MTS, we don't have it in there, and both of them are revolving funds. Could you explain the rationale for the difference in that? Thank you, Mr. Chair.
Thank you, Mr. Thompson. Minister Schumann.
I will start it, Mr. Chair, and then maybe Vince will want to add something. The GNWT owns the tank farm assets. If we were to have that inside the revolving fund for fuel services, the price of fuel would be unaffordable. It wouldn't be attainable, because that would be right down through MTS. This way, it is in the government assets, and it is written down as a government asset versus through the fuel services. I think I have got that right, but I will defer it to Mr. McCormick here to answer it a little bit better. Thank you, Mr. Chair.
Thank you, Minister Schumann. Committee, please keep the sidebar conversations to a minimum. Mr. McCormick.
Thank you, Mr. Chair. Yes, Minister Schumann is correct. It is just the way the assets are disclosed. They are all GNWT assets, but they are not disclosed separately for fuel services on their statements. Thank you.
Thank you, Mr. McCormick. Mr. Thompson.
Thank you, Mr. Chair, and I thank the Minister and his staff for answering the questions. No further questions on this one. Thank you.
Thank you, Mr. Thompson. Next, we have Mr. Vanthuyne.
Thank you, Mr. Chairman. I will go to pages 244 and 245, where we have a number of the programs that we contribute to described, in particular, the NWT energy efficiency projects. It seems as though we contribute about $300,000 to this each year. It is where the department works with the Power Corporation to integrate residual heat, variable-speed generators, and other efficiency technologies that could reduce fossil fuel consumption.
The Minister is aware of SSi Energy coming to the Standing Committee on Economic Development and Environment and putting forward a presentation that described some new technologies, to some degree a new technology, but, you know, these were technologies that are fairly well known and fairly well utilized by other means. When you bring them all together, they can do wonders in terms of reducing energy consumption and fuel usage in communities, so I am wondering if the department is taking any consideration into either working with corporations such as SSi or ATCO or others that could form microgrids and/or district energy systems to help get some of the thermal communities off of the use of really large single heavy-duty generators and get down to a system where we can utilize the energy and the fuel more efficiently. Thank you, Mr. Chair.
Thank you, Mr. Vanthuyne. Minister Schumann.
Thank you, Mr. Chair. I have met with Mr. Philipp myself a number of times. It will be either around his battery initiative that he is working on or his proposed idea of centralized heat within a community and electricity. We have had a number of discussions with him. I have asked him to sit down with our director of energy and have those conversations to kind of dissected a bit. As I have said in the House, when I talked to Mr. Philipp, I was a little bit concerned about the size of the project and the amount that he wanted to chew off at once. Even, I was a little bit concerned about the community, that, even though he's very passionate about Fort Providence, I was a little bit concerned about the size and the layout of it and suggested maybe have a look at a little bit smaller tighter knit community, where some of these things could be done in a more economic fashion.
I like Jeff's concept. I think there is a possibility that something can be worked out in a manner that could work in one of our smaller communities. We will continue to have those discussions with him, but when you have a look at what he was trying to do all at once, I think it is a bit much. It hasn't been quite proven everywhere. He has, in theory, I think, and I am not an expert on this, but when you look at the multiple generators that he wanted to lay out throughout the community and the electricity aspect of it, I said, you know, one of the concerns I've got going forward and when you look at our energy strategy 2030, our three-year rolling plan, I said we are going to put a T-line into Fort Providence and put them on hydro, so does it clearly make sense to have a community that is going to be on the hydro system have diesel generation there for electricity? Central heat is something that is intriguing, but I know the details would have to be worked out around that, around cost effectiveness, about the length of line, about capturing the amount of BTUs from the source point to the building, and what would that entail, and the cost factors of that, and the layout of the community, as well.
That being said, as we have said, our energy strategy is a three-year rolling plan, and I will continue to look at these types of initiatives. We have made the commitment. We need to lower greenhouse gas emissions in the Northwest Territories. It would be around central heat or building efficiencies or electrical generation, and we will continue to work with these proponents going forward. Thank you, Mr. Chair.
Thank you, Minister Schumann. Mr. Vanthuyne.
