Winds of change
Wreckhouse Energy offering net-metering solutions for Newfoundland companies
There’s no avoiding it, and it shouldn’t shock anyone that over the next five years Newfoundlanders and Labradorians are going to be paying a lot more for electricity.
Newfoundland and Labrador Hydro’s nine per cent rate increase came into effect on July 1, and the company recently submitted applications for further increases between 6 and 6.6 per cent in 2018 and 2019. That doesn’t include the expected rate increase once the much-maligned Muskrat Falls hydroelectric project comes online.
Two enterprising engineers in St. John’s have launched Wreckhouse Energy, a company that aims to help customers take the sting off the climbing rates while taking advantage of the net-metering legislation that came into effect July 1, through the installation of small-scale wind turbines.
“At the end of the day you have to buy some amount of power and that costs money,” says Jesse Mccaw, a 29-year-old civil engineer who is partnering with 23-year-old electrical engineer Justin Wicks.
“But with this here we’re essentially offering a very, very low-risk solution to that.”
At this stage, the duo is focusing on commercial customers and municipalities outside St. John’s, specifically those who consume 120,000 kilowatts per hour or more annually.
Mccaw says it’s ideal for companies that are interested in protecting their interests.
“For some users we’re offsetting 100 per cent of their usage, so they’ll basically pay their service fee and their demand charge fee to Newfoundland Power or (Newfoundland and Labrador) Hydro and the rest of it is a monthly rate that they can look at and go, ‘I know what I’m paying.’
What’s more, any excess energy generated can be sold back to the grid.
Customers will have the option to purchase the turbines outright or they can rent one from Wreckhouse at a monthly fee far less than the kilowatt per hour (kwh) grid prices.
“We’ll rent the turbine to them for no cost to install and we take care of everything from the feasibility up to operation and maintenance,” says Mccaw.
“Whatever their average price would be buying from Hydro, we charge a slightly lower price for them to use our energy, so they’re guaranteed to save X amount of dollars per year.”
Those who purchase get the same savings, but will incur the maintenance costs unless they enter into an agreement with Wreckhouse.
However, the turbines don’t come cheap. A 100-kilowatt tower, the maximum allowed under the net-metering legislation, will cost between $350,000 and $400,000. “But in 2022, it could save them around $60,000-plus a year, depending on their load,” Wicks says.
They also point out how wind turbines offer the potential for additional savings on demand charges, through green energy credits, and against future carbon taxes.
“We expect the green energy credits to become more valuable going forward as carbon pricing comes in because someone would be able to buy green energy credits offsetting their non-green energy and thereby reducing their carbon tax,” Mccaw says.
Wreckhouse is currently working on sourcing its turbines from companies outside Canada, but once the product arrives the aim is to use as many local companies as possible in the installation process. In the long term, they hope it fosters the birth of a new industry.
“We’ll need people trained in turbine maintenance, electricians that are familiar with net-metering installations because there are rules specific to it, and engineers,” says Mccaw.
Wreckhouse is already in talks with a handful of clients and expects to erect the first turbine this fall. By this time next year, they hope to be well into the installation process for many more.