A7

Roy MacMullin

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The cost of oil is rising and will continue to rise. At what price do we say enough is enough and abandon oil as a home heating fuel?

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Historical re-enactors deliver firewood at Kings Landing Historical Settlement. With the cost of home heating fuel going up to untouchable levels, wood may be a viable alternative for more families.

That's a decision that each person has to make. Do governments have a role to play in ensuring warm homes via reasonable heating choices in Canada? Most of us would say 'yes'.

Governments may be still unaware of the nature of this emergency. They can recognize hurricane or flood damage. If there were no fuel it would be easy to understand. But rising prices can be tricky. Is it a permanent condition? How bad will it get?

The funny thing is that world oil production hasn't even started to decline yet. It's just a little less than demand. Imagine when the real decline starts. So let's talk about our vulnerabilities.

About 80 per cent of homes in P.E.I., 25 per cent in New Brunswick and roughly 65 per cent in Nova Scotia use oil as the heat source. Approximately 1.3 billion liters of fuel oil are burned each year in Atlantic Canada. At last year's price of 91 cents, that was $1.2 billion. At present day prices of $1.43/liter, the new bill is $1.86 billion, a difference of $660 million. Next year, who knows? If families locked in a good price last fall, the sticker shock will only hit them later this year.

Over the next few years, there will be a large-scale migration from unaffordable oil to other sources of heat, as peak oil becomes a reality.

The key question is, what the alternate heating source will that be and what are the implications of this massive shift?

We should realize that the limited Enbridge natural gas network will provide little relief outside of portions of Fredericton, Moncton and Saint John. Unfortunately, Efficiency NB hasn't existed long enough to make a dent in the efficiency levels of our antiquated housing stock. Elizabeth Weir and Enbridge recently announced that they are contributing $2,250 and $7,000 towards a $10,000 per person conversion program from electric heat to natural gas.

To put our oil refugee's plight into perspective, Atlantic Canada's 1.3 billion liters of fuel oil is equivalent to 11.5 billion kilowatt-hours or 11 times the annual usage of Saint John Energy. The peak that a shift from oil to electricity would create on the Atlantic grid would be 2,500 MW or more, which is equivalent to four new Lepreau reactor units.

Looking at a wood alternative, Atlantic Canadians would have to cut 2.8 million cords of wood to replace this volume of oil. For the sake of comparison, the existing residential usage of hardwood in New Brunswick is roughly 500,000 cords each year.

But what about conversion from heating oil to other fuels just in New Brunswick? My estimate is that 60,000 homes are heated with oil. Assuming an average usage of 2,500 liters per home, that would be 150 million liters or $214 million out of consumers' pockets annually at today's price. The replacement of this energy by electricity would require 1.4 billion kWh, from a power station of 420-megawatt capacity, which is similar in size to the Belledune coal station. Since most of this oil is consumed in the winter, shifting to electricity would cause a large peak load demand on New Brunswick's grid.

Using wood as a solution would require an additional 332 thousand cords to be harvested annually to displace New Brunswickers' fuel oil requirement. This shouldn't be a problem with mills shutting down. Pellets and briquettes can be made of softwood that is compressed to provide the same heat density of hardwood, with less moisture content.

Wood heat could very quickly meet the requirements of a conversion program. The reduction in oil purchases of 943,000 barrels would keep $137 million a year in the New Brunswick economy as opposed to sending it offshore. Over the years, this would be the equivalent of investing more than $1 billion in the local economy.

If Efficiency NB extended an offer of $2,250 to oil heat customers converting to wood, it would go a long way toward alleviating the problems of oil prices. The cost of providing stoves would be $135 million (60,000 stoves at $2,250), spent over a number of years.

We are at the beginning of an emergency, perhaps a low intensity war.

This change from low cost energy to high cost energy will sap our resources, leave us poor and eventually cold. If we fail to adapt to the heating oil challenge as well as the other aspects of peak oil, we lose. Do you see the leadership that we need to ensure that we don't freeze in the dark?

Roy MacMullin is a writer on energy and political topics. Comments are welcome at roy.energy@rogers.com Previous articles can be found at http://roymacmullin.wordpress.com/