Premier Scott Moe was in Estevan on Saturday for one of the first times since winning the Saskatchewan Party’s leadership race in January and becoming the province’s premier.
Moe was in attendance at the Saskatchewan Party’s southeast regional meeting, which attracted supporters from the Estevan, Cannington, Last Mountain-Touchwood, Moosomin and Yorkton constituencies. He discussed several initiatives that have occurred and have been successful, and plans for the next provincial election, expected in 2020. He then answered questions from the party members.
That night, he spoke at a social for the membership.
“Most certainly we’re going to be thanking the people of the southeast region of the province of Saskatchewan for their support, not just over this past year with all of the things that have happened within the party with a leadership race … but thanking them for their support over the last 21 years, as we are a relatively young political party,” said Moe.
In between the two meetings, Moe answered questions from local reporters on issues facing the province and the Estevan area, including the future of Units 4 and 5 at the Boundary Dam Power Station, the proposed equivalency agreement with the federal government and the issues posed by the ongoing oil price differentials.
SaskPower announced earlier this year it would retire Units 4 and 5 at Boundary Dam. Without an equivalency agreement, they would come offline at the end of next year. An agreement would allow Unit 4 to remain online until 2021, and Unit 5 to stay online until 2024.
"Right now we have the equivalency agreement that we have sent in to the federal minister of the environment's office, and we're waiting for her signature,” said Moe.
“We're waiting for her approval so that we can move forward in what is the most affordable manner on behalf of all the people of the province, but also to move forward with respect to understanding that traditionally we've had a large part of our power source come from this Estevan area through coal mining.”
Not only would the agreement extend the life of Units 4 and 5, but it would also affect the Shand Power Station, Unit 6 at Boundary Dam and the units at the Poplar River Station near Coronach.
The agreement was sent to federal Environment Minister Catherine McKenna a few months ago. The government has been asking its federal counterparts, including Prime Minister Justin Trudeau, to approve that agreement so that Saskatchewan can move forward with its power generation needs.
“We are not shifting away from the methods that we had produced power over the decades,” said Moe.
The premier has a number of concerns with the federal government, and the length of time for the equivalency agreement is one of them.
An equivalency agreement would not affect any potential decision on whether to retrofit the Shand Power Station or Unit 6 at Boundary Dam with carbon capture and storage technology.
“It’s going to impact on the decision on broader terms on how we are able to and when we are able to bring different power sources online,” said Moe.
As for whether there would be a relief plan for Estevan due to the closure of Units 4 and 5 at Boundary Dam, Moe said SaskPower is engaged in ensuring there wouldn’t be layoffs. There are other opportunities for people in Estevan and elsewhere in the province for SaskPower employees affected by the closure.
He didn’t address the potential for layoffs at the local mines due to the closure of Units 4 and 5, or the impact of those layoffs on the community.
Moe also discussed the price differential facing the Western Canadian oil patch. The price of oil for West Texas Intermediate oil was $70.97, as of Friday morning, while Western Canadian Select was at $20.47, for a differential of $50.50.
Moe believes that if agriculture or auto manufacturing were affected by such a wide differential, or if Bombardier was impacted, there would be a different discussion. But since the energy sector is impacted, the issue isn't resonating to the degree that it should at the federal level.
"We have a disastrous oil differential that's costing the economy and the province of Saskatchewan. The latest figure is $7.4 billion a year (for the economy). It's costing directly the Government of Saskatchewan about $500 million per year. If you put that in the perspective of the budget that we're trying to balance here in the province, it much more than offsets the immediate financial challenges that we have."
It’s a challenge not only for communities in the oilpatch, but it’s a loss to all Canadians, because it bites into federal revenues.
“We’re not able to achieve the price that Eastern Canadians are paying for their energy products,” said Moe.
He cited the lack of pipeline capacity as the reason for the price differential, and he believes the issue would be resolved if pipelines, such as Energy East and Trans-Mountain, would be built.
Despite the price differential, Moe said the provincial budget will be balanced in 2019-20.
