Community and Educational Support

From 2018 to 2023, the Pembina Institute was a proud co-delivery agent of the Indigenous Off-diesel Initiative (IODI), which gave Indigenous leaders in remote communities across Canada funding and skills development support to work on clean energy transformation in remote Indigenous communities. Here we amplify positive aspects and key recommendations stemming from our participation in IODI.

Indigenous communities continue to face persistent economic, regulatory, and political barriers as they seek to reduce diesel dependency and realize energy sovereignty. Confronting these barriers through a commitment to the inclusion of Indigenous leadership within decision-making and design processes can support the advancement of multiple government priorities. Key among them include the implementation of UNDRIP into Canadian law.

The decarbonization of transportation systems is crucial to reducing diesel reliance and achieving Canada’s net-zero targets. In many northern and remote communities transportation-related emissions represented over half of total greenhouse gas emissions in 2019.

Over half of the total diesel consumed in remote, often northern, communities is associated with heating buildings and homes. For federal and provincial governments to meet their commitments to support Indigenous communities to get off diesel, they must take a quality housing first approach.

In remote communities across Canada, low-carbon power sources such as hydrogen, nuclear, and energy generated by movement in the ocean are being studied more closely. Each of these clean energy technologies are options under consideration as remote Indigenous communities further their efforts to eliminate dependence on diesel power.

Systemic barriers continue to prevent clean energy projects from moving ahead in remote communities across Canada. This paper presents six Energy Service Models that offer options for clean energy proponents to develop, build, and operate projects by alleviating some of the challenges associated with lack of capacity and capital.

The way utilities deliver energy to remote communities and generate revenue discourages the purchase of renewable energy as well as the implementation of energy efficiency measures. For Indigenous communities to realize a clean energy future this needs to change.

As remote communities switch from diesel to renewables, smart policy changes can advance ways to reduce the carbon intensity of existing generators, lower emissions, and pave the way to a clean energy system. This issue paper reviews some options.

Indigenous communities that are transitioning from diesel energy face barriers in financing their clean energy infrastructure. But governments can create the policies and programs that will give Indigenous communities better access to the money they need, either by providing financing themselves or by fostering the conditions that promote private investment.

A well-designed independent power producer policy with a fair and equitable power purchase agreement rate promotes the adoption of locally led renewable energy projects in remote communities. A fair and equitable energy price must capture the full costs of building and operating a diesel-based energy system within an accurate PPA rate structure for renewable-energy projects. As well, energy developers in remote communities must include community- and Indigenous-led electricity developers.

The widespread adoption of renewable energy could displace the centralized system of generating and distributing energy to customers and provide opportunities to unlock a more decentralized (distributed) way of managing energy. But reducing reliance on diesel, and empowering communities to produce their own energy, depends upon the support of governments, utilities, communities and consumers for the shift from centralized microgrid systems to more distributed energy generation.

Through policy work done under our Renewables in Remote Communities program and the Indigenous Off-diesel Initiative, we are advancing work in two overarching and eight specific policy areas to support energy projects being led by Indigenous champions involved in the IODI program.

In the past few years, important progress has been made toward reducing diesel dependency in remote communities. As a result of years of leadership and work within Indigenous communities to build capacity, impressively large renewable energy projects are coming on-line, and communities are leading their own energy transition. Increases in government funding programs that support diesel reduction projects have been important to recent progress.

Of the 300-plus distinct First Nations reserves in British Columbia, 27 are remote communities, and most of these rely heavily on diesel generators as their primary energy source. But rather than depending on shipments of diesel into their hard-to-reach communities, they could harness abundant local renewable energy resources such as sun, wind, water and biomass to create local energy solutions that contribute to economic independence while creating local jobs.

This is the moment to create a roadmap for a society that is more resilient to these macro shocks – whether they are brought about by a pandemic or climate change. Canada’s response must support a more resilient, healthier economy that is competitive and shows economic strength in a decarbonized global market.

In Canada, both utilities and proponents of renewable electricity projects face many challenges when working together to transition remote communities to clean energy.

There are many successful examples of renewable energy sources being integrated in remote communities to create hybrid microgrids — and the list continues to grow as projects demonstrate they reduce operating costs, carbon pollution, and reliance on imported diesel fuel.

This backgrounder breaks down some common fuel cost terms that are important for conversations around transitioning remote communities away from diesel.

Since remote communities are not connected to the North American electricity grid, they make use of their own small-scale microgrids.