Atlantic Canada’s offshore winds hold hundreds of gigawatts in untapped potential, but the region will need to secure demand from key markets to achieve it. 

That’s one of the main findings of a recent report by Stantec for energy research group Net Zero Atlantic. 

“The resource is abundant, but its utilization might be constrained by economics, infrastructure, and demand growth,” reads the report.

Different scenarios are considered: if offshore wind power is only used to power the provinces, then development would be capped at 2.5 gigawatts, but if it was also used for exports and hydrogen production then it could reach 16.5 gigawatts. 

Nova Scotia wants to build Wind West, a project with a potential 66 gigawatts – a massive target given Canada currently has a total of about 150 gigawatts of installed generation capacity.

Asked why the report’s cited figures came in much lower than the potential often cited by the Nova Scotia government, energy director David Miller tells iPolitics the modelling scenarios used did not capture recent changes in energy demand.

“The market opportunity for offshore wind is different today than we think it was two years ago,” he said, adding electricity demand has markedly increased across the region.

Also, the study does not consider the potential buildout of new transmission infrastructure, which would build a case for West Wind to generate more power, said Miller. 

“If we took away the constraints on the study and redid the modelling, we would see significantly increased volumes to Quebec and New England,” he said.

Nova Scotia Premier Tim Houston recently reached an agreement with Massachusetts to explore how Wind West could help power the New England grid, but the U.S. state has not yet committed to a long term contract. 

Similarly, Hydro-Québec is listed as an observer on the report, and the public utility is aggressively pursuing wind power to meet surging demand. But it’s unclear yet if Wind West will play a role in la belle province’s energy mix. 

First phase in the works

Nova Scotia is working to build the first phase of Wind West, which involves 5 gigawatts of capacity. That project alone would cost an estimated $60B, with more than a third spent on transmission. 

Should the project secure a cheap Canada Infrastructure Bank loan and investment tax credits, it could produce electricity at a cost of $170 per megawatt hour. 

In contrast, costs for new energy supply in eastern Canada typically range from $50 to more than $250 megawatt hour. 

But price is not the only factor that will determine demand. According to Miller, the electricity market is also shaped by environmental concerns and price stability.

“They may not be demanded purely on their price basis, but they do have other attributes,” he said. 

Should West Wind secure a long term demand contract, it would be a lot easier to obtain financing. 

The Canada-Nova Scotia Offshore Energy Regulator is expected to issue the first offshore wind licenses later this year. 

Federal Natural Resources Minister Tim Hodgson tells iPolitics he’s not aware of the report, but that West Wind would be a “huge resource” to develop and his government is “in active discussions with Nova Scotia to facilitate the development of that project.” 

Wind West was referred to the federal Major Projects Office last fall as a ‘transformative strategy’ that has potential needs more work. 

Asked if that special government agency had comments on Stantec’s report, the Privy Council Office said in a statement that it will keep working to advance Windwest by providing regulatory certainty that attracts private investment. 

“To avoid influencing potential decisions and to respect the sensitivity of ongoing discussions, the Government of Canada will refrain from commenting publicly on the development of individual projects or strategies,” reads the statement.