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Flipping the switch

Why it’s so difficult for hundreds of remote communities to do away with diesel and embrace renewable energy

Solar panels line a rooftop on a building in Nunavut.

The entire rooftop of the student housing building at Nunavut Arctic College in Iqaluit is covered in solar panels. They’ve soaked up the sun’s rays every day since they were installed in August 2021, yet so far, haven’t produced a single watt of electricity.

The project is fully installed, but the paperwork isn’t settled to officially flip the switch and begin producing power.

There are several renewable energy projects proposed in different parts of Nunavut, but the territory is a reminder of how much of a challenge the country faces in decarbonizing remote communities and providing access to a stable, economical supply of electricity.

To this day, the territory remains almost completely dependent on importing diesel for electricity and heating as part of an energy system that is unaffordable and unreliable, while also a major source of pollution.


Earlier this month, dozens of Canadian delegates joined world leaders in Egypt to discuss ways of tackling climate change at COP27, the United Nations Climate Change Conference.

Canada faces big challenges and ambitions to meet its climate targets, such as finding solutions to drive down emissions in the oilpatch and on the highways and railways that criss-cross the country.

Among the dozens of different options to lower emissions in Canada, one obvious approach would be to phase out diesel power plants that exist in most provinces and territories. It may seem like low-hanging fruit, but the simple notion of switching to cleaner energy is a mighty task with many obstacles.

Several large, white fuel storage tanks dot the rocky, snowy landscape in Iqaluit.
Fuel tanks on the coast store diesel to keep the lights on in Iqaluit. (Kyle Bakx/CBC)

The federal government has a goal of eliminating diesel-powered electricity generation in remote communities by 2030, which many experts applaud, even though they say it’s highly unattainable given current progress and how much infrastructure would still be needed.

Some communities are finding success with wind and solar to meet some of their electricity needs, but not as the primary source of power.

There are more than 200 remote communities in the country that aren’t connected to the electricity grid. Instead, the majority rely on diesel to run a small network of power lines in the town as opposed to a larger regional grid.

In Iqaluit, the hum of the power plant never stops from its perch on a hill, towering over the homes and businesses.

An above-ground pipeline pumps the fuel right through the heart of the community from storage tanks on the coast of Frobisher Bay. Here, the reliance on diesel isn’t in the background, but ever present.

Heather Shilton is trying to change that.

Disagreements with utilities

Shilton leads the development of several renewable energy projects in the territory as director of Nunavut Nukkiksautiit Corporation (NNC), a renewable energy company and subsidiary of the Inuit-owned Qikiqtaaluk Corporation.

Through her job, Shilton is driven to act on climate change, create meaningful employment in the community and spur economic development.

The rooftop solar panels on the student housing building is an NNC project, which Shilton said is not yet producing electricity because an agreement hasn’t been reached with the territory’s utility, the Qulliq Energy Corporation (QEC).

Just up the snow-packed road from the four-storey student dorms is the Aqsarniit Hotel, where NNC was proposing a large solar project.

After further disagreements with the utility, Shilton said the company decided not to connect to the grid, but instead aimed to produce all of its own electricity with a hybrid solar and diesel system that incorporates battery technology, too. The proposed off-grid project would cost about $6 million.

A hotel room featuring a queen bed, a television, a work station and a chair.
The 94-room Aqsarniit Hotel and Conference Centre could disconnect from the local Iqaluit electricity grid and instead be powered by its own solar and diesel powered micro-grid. (Kyle Bakx/CBC)

The other noteworthy NNC project is a wind farm and battery storage facility designed to reduce the amount of diesel used by 50 per cent in the community of Sanikiluaq, located on an island in Hudson’s Bay.

The proposal has been in the works for more than six years, after a meteorological tower was installed to monitor wind speeds. Construction is ready to begin as the surveying, environmental studies and other design work is completed. However, this project is also on hold because of a disagreement with the utility.

“That project has been ready to go for years and we can’t move anywhere because the utility won’t talk to us on that one,” said Shilton, who often takes to social media to express her concerns.


The main disagreement is about how the utility will pay for the renewable electricity the projects produce. The QEC doesn’t have a policy in place for how to purchase electricity from independent producers.

The utility’s proposed rules would require power producers to sell all their electricity to the utility for $0.25/kWh based on current diesel prices, then purchase back that same electricity for $0.51/kWh. It’s unfair, said Shilton, and makes projects uneconomical.

“We’re all stuck,” she said about developing renewable energy projects in the territory. “We haven’t been able to get anywhere on a power purchase agreement or any pricing negotiations or anything like that.”

A snow mobile is parked across the road from several colourful buildings in the town of Iqaluit.
Electricity rates in Iqaluit are among the highest in the country. (Kyle Bakx/CBC)

The rules are much different for residents who put solar panels on their home, as the power produced is deducted at an even rate from the utility, so some customers have monthly utility bills of nearly zero in the summer months.

Beyond those three large projects, the NNC has another four possible renewable energy facilities in development.

Despite subsidies, Nunavut residents pay among the highest electricity prices in the country — about four times higher than average rates in Ontario — due to low population density and expensive diesel imports.

Reliability of renewables

The priority of the QEC is to keep the lights on, said acting vice-president Bill Nippard. Climate change is not part of its mandate.

Nippard is concerned about the intermittency of renewables and the potential added expense of introducing solar or wind in the territory.

This is especially relevant, he says, because the utility operates isolated micro-grids in 25 different communities spread far apart, and each community would require its own renewables plant and backup generators. All that new infrastructure would likely mean rate increases for customers.

“We can’t do anything here with these programs that’s going to increase cost to our customers, and that’s our number one concern after, of course, safety and reliability,” he said.

WATCH | Is Canada’s emissions target achievable?

Heather Shilton, with Nunavut Nukkiksautiit, and Bill Nippard, with the Qulliq Energy Corporation, discuss whether federal emissions targets can be achieved.

The pollution from creating electricity in the territory is eight times higher than the national average and not a week goes by without an outage in one of the communities.

Despite advancements in the performance and cost of renewable energy and battery storage technology, Nippard is firm in his intent to stick with diesel and continues to have reservations about wind and solar.

“If you have major fluctuations, you’re either going to cause damage to customers’ equipment or you’re going to cause power outages,” he said.

“The challenges here in the North are significantly more complicated than they are in the South, where you’re tying into large grids that can accommodate fluctuations with renewables.”

Trucks are parked in front of a power plant.
Virtually all of the electricity produced in Nunavut is from diesel, including in Iqaluit. (Kyle Bakx/CBC)

A bureaucratic battle

Technology isn’t the obstacle preventing more renewable energy in remote communities, said Ian Gates, a University of Calgary engineering professor, who co-authored a 2019 report about the electricity system in Nunavut.

“They are comfortable in the system they’ve created,” he said. “There is a bureaucratic uphill battle.”

That’s why he says everyone — from residents and private industry to governments and public officials — must be aligned on reducing reliance on diesel.

“Technically, we have lots of answers. Socially, we have a lot of hurdles,” he said.

His report describes how local renewable energy sources are a critical need, in part because the area is already experiencing more severe effects of climate change than the rest of the planet, and transporting diesel through Arctic channels is becoming more unpredictable and dangerous.

WATCH | What’s holding back the switch to renewables?

Ian Gates, a University of Calgary engineering professor, says there's comfort in the status quo, which makes it difficult for communities to change energy systems.

Besides solar and wind, the report explores how Nunavut has potential to produce tidal energy. As the tides come in and out each day, the movement of water can be harnessed to generate electricity.

Some developers are already exploring this technology in the territory, since Frobisher Bay has some of the highest tides in the country.

However, environmental laws require proof that the technology won’t harm oceans or aquatic species, which can be difficult to obtain without proper testing.

Remote communities could look to Iceland for inspiration. The country was completely dependent on importing fossil fuels in the 1970s, but now relies almost exclusively on geothermal energy.

Though Canada’s potential for producing geothermal energy in the North is low, just the fact that Iceland made the switch from fossil fuels shows that change is possible.

Remote communities take action

Despite these challenges, some remote Canadian communities are beginning to slash their diesel use.

In Old Crow, Yukon, a community about 130 kilometres north of the Arctic Circle, a solar project provides about 25 per cent of the electricity and reduces the amount of diesel they need to fly in by almost 200,000 litres. The community continues to rely on its own isolated grid.

After construction was completed in 2021, the diesel power plant went silent during the summer months for the first time in 50 years.

Jay Massie describes it as “a beautiful silence in the community.” Most importantly, he says, the lights are still on.

He’s the vice-president of northern development and Indigenous relations with ATCO Electric, which built the project (along with Yukon-based Solvest) and buys the electricity. He’s also a member of the Ta’an Kwäch’än Council in Whitehorse.

A close-up shot of solar panels.
A sign on the side of a building welcomes visitors to the community of Old Crow, Yukon.

Old Crow’s solar farm is made up of over 2,000 panels, a 616kW battery energy storage system and micro-grid controller to help power the community of about 235 people. The panels provide about a quarter of the community’s electricity needs. (CBC)

There were challenges with construction in such a secluded location, he said, but the solar facility is working as expected. Similar projects are now being designed for three other remote communities in the territory.

The Vuntut Gwitchin First Nation owns the facility and earned about $400,000 in profits in the first year, which was re-invested in the community. Utility rates have remained unchanged.

Batteries are overcoming any intermittency issues, Massie says, and storage technology will have an important role to play for years to come as renewable energy expands to other remote communities in Canada.

There was a time when I didn’t believe 25 per cent [renewables] was going to happen. So yes, I do believe at some point 100 per cent is going to be able to happen from renewables.

Jay Massie, vice-president of northern development and Indigenous relations with ATCO Electric

For now, renewables can help reduce diesel use, he says, and maybe one day they will allow communities to shut off their diesel power plants entirely.

“There was a time when I didn’t believe 25 per cent [renewables] was going to happen. So yes, I do believe at some point 100 per cent is going to be able to happen from renewables,” he said.

“The key item in these communities is how we store that energy so it’s able to be used right when we need it.”

In Old Crow, the community is now exploring the development of a wind farm.

More aggressive federal action needed

Natural Resources Canada provided funding to the Old Crow project and those proposed by NEC in Nunavut, in addition to more than 100 other renewable energy projects in remote communities across the country.

The federal government’s emissions reductions plan describes diesel power plants as expensive to maintain, while also producing health, environment and economic concerns.

“Ultimately, any deep decarbonization effort in the North will be tied to the availability of zero-carbon technologies that will reliably work in northern climates, the cost of such technologies, the availability of funding to deploy it, and the capacity to maintain such technologies,” the report states.

A red boat rests on the frozen shores of Iqaluit near several homes built on stilts.
Power outages are a common occurrence in Nunavut, and the success of renewable energy projects elsewhere in the North only increases the frustration felt by those who see great potential for renewables in the territory, but little progress. (Kyle Bakx/CBC)

Ottawa has announced $300 million in additional funding over the next five years to help rural, remote and Indigenous communities shift from diesel power plants to cleaner sources of electricity.

Still, there is a need for the federal government to be much more aggressive in reducing the reliance on diesel to produce electricity, said Ernie Daniels, president of the First Nations Finance Authority.

Growing up in Fort Smith, Northwest Territories, he remembers frequent power outages and noise when the town relied on a diesel power plant.

Daniels wants the federal government to divert the money it spends on diesel power plants toward renewable energy. Currently, the federal government provides a subsidy on diesel used to generate electricity since it’s exempt from the carbon tax.

“The less that you have budgeted, the less that you can actually build and put into communities to replace these dirty diesel generators.”

To actually achieve its climate goals, he said, the federal government has to do more.

“If it is a priority, then they should be addressing it,“ said Daniels. “Our communities actually do want to change, I know that for a fact.”

Solar panels on a roof.
Solar panels on the student housing building at Nunavut Arctic College in Iqaluit haven't produced electricity since they were installed more than a year ago due to a disagreement about how much the developer should be paid for the power that's produced. (Kyle Bakx/CBC)

The success of projects like the solar field in Old Crow only increases the frustration of those in Nunavut, who see great potential for renewables, but little progress.

“The state of renewable energy in the territory is abysmal,” said Adam Lightstone, the MLA for Iqaluit-Manirajak.

There is a need for more programs to incentivize residents and private developers to embrace renewable energy, he said.

Meanwhile, the electricity utility has to pay more for clean power because the proposed rates are insufficient, Lightstone said, and act as a barrier preventing the development of alternative energy projects.

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