THE INFLUENCE OF ISLANDNESS ON ENERGY POLICY AND ELECTRICITY SUPPLY A thesis presented to the Faculty of Arts (Island Studies) at the University of Prince Edward Island by E. Kathleen Stuart in partial fulfilment of requirements for the degree of Master of Arts in Island Studies © E. Kathleen Stuart 2006 Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 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SIGNATURE PAGE REMOVED Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. ABSTRACT THE INFLUENCE OF ISLANDNESS ON ENERGY POLICY AND ELECTRICITY SUPPLY E. Kathleen Stuart Master of Arts (Island Studies) Advisor: University of Prince Edward Island, 2006 Dr. Godfrey Baldacchino Despite global power reform, electricity is still provided in many islands by vertically integrated monopoly utilities. The aim of this research is to identify the impact and influence of 'islandness' on electricity policy decisions. This multi­ disciplinary, exploratory study uses both quantitative and qualitative methods to explore islandness through such attributes as scale, remoteness, complexity, adaptive capacity and the small-scale syndrome of totality/monopoly/intimacy. The research includes a case study of Prince Edward Island, Canada, whereby the energy institution is examined through interviews with key informants. The study concludes that negotiated political solutions rather than market solutions offer more promising alternatives to solving energy issues in small islands. Recommendations include: encouraging alternative energy technologies given already high electricity costs; providing top level ministerial support for energy portfolio; implementing clear, comprehensive energy policy with sustainability targets enforced by legislation; and enhancing energy literacy through broadly based public debate and truly innovative energy policy. Keywords: islands, energy policy, electricity, politics, society, sustainability. Prince Edward Island, energy literacy Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Ill ACKNOWLEDGEMENTS First, a special thank you to all those who generously gave of their time and patience to participate in lengthy interviews, facility tours, and provision of technical guidance in support of my educational goals. They are Jamie Ballem, Gordon Bird, David Daughton, Gordon Greenwell, James Lea, Malcolm Lodge, Steven Martina, Neil McConnie, Shawn Murphy, Maurice (Moe) Rodgerson, Neal Shinyama, Erin Swansburg and Andrew Trivett. Words are inadequate to thank my mentor and supervisor, Godfrey Baldacchino, who has believed in me from the start and has shared in my transformation throughout this academic apprenticeship. I also thank my review panelists, Kirk Brown, Benet Davetian and Geoff Bertram for their special contribution of time and interest in working through this interdisciplinary document. I am indebted to the faculty members and staff at the University of Prince Edward Island who have gone out of their way to encourage and inspire this graduate student. Thanks to Barry Bartmann, Ron Collins, Richard Kurial, Ed MacDonald, Roberta MacDonald, David Milne, Jean Mitchell, P. Nagarajan, Annie Spears, Tom Trenton and David Weale, for you have each contributed something special to my development. I especially want to thank Irene Novaczek who has been endlessly supportive and an all-round inspiration. I also acknowledge with thanks the assistance of staff in the Research and Development Office and the Robertson Library. Thanks also to the overseas colleagues who have led me forward, namely Maria Ackren, Rose Marie Azzopardi, Calbert Douglas, Russell Fielding, Margo Guda, Indra Haraksingh, Peter Hay, Anne Wallis, Leighton Waterman, Daniel Weisser, John Young and William Young Jr.. To all my colleagues and friends in the Island Studies Program, a sincere thank you for sharing the joys and the pains of our academic journey together. Very special thanks to Laura Lee Howard and Janice McKendrick for being there. Special thanks to Sheila Curley, Shawn Flyrm, Jane Railing QC, Elizabeth Reagh QC, Susan Robinson, Beverly Mills Stetson QC, Katharine Tummon and Jim Wyatt for their support and encouragement as I juggled my former duties at the Law Society with my new academic role during 2003-05. Most of all, I thank my life partner Ron MacKay for his loving patience and good humour as I studied, wrote, neglected chores and became more absent- minded. 1 am also forever indebted to family members Joscelynne Bordeaux and Tyra Stuart for their ever-optimistic enthusiasm and support. Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. IV TABLE OF CONTENTS Pream ble Declaration .............................................................................................................. i Abstract ..................................................................................................................... ii Acknowledgements ............................................................................................... iii Table of Contents .................................................................................................. iv List of Tables .......................................................................................................... ix PART I. INTRODUCTION CHAPTER ONE: BACKGROUND TO THE STUDY............................................... 2 An Encounter with Socially-Constructed Knowledge From Poetry to Politics Defining the Energy Institution Researching 'Islandness' Aim and Scope Significance of This Study Overview of the Study Part One - Introduction Part Two - Context Part Three - The Research Process Part Four - Synthesis Endnote PART n. CONTEXT CHAPTER TWO: ELECTRICAL UTILITIES AND THE COST OF ELECTRICITY IN ISLANDS.................................................. 10 Introduction The Global Context Electricity Dynamics in a Small Island Aim of This Chapter The Peculiar Role of Profit-Driven Public Utilities Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Energy-Related Literature Cost Paradigms Neo-classical Economics Ecological Economics and the Institutional Approach Electricity Costs at Small Scale Geography, Remoteness and Technology Natural Resources Distance Transmission Systems and Access to Markets Technological Choices Financial Risk Achieving Balance in Islands Fossil Fuels and Human Welfare Alternative Energy Technology for Islands Cogeneration and Conservation Concluding Remarks CHAPTER THREE; THE SOCIAL, POLITICAL AND ECOLOGICAL CONTEXT OF ELECTRICITY IN ISLANDS........................................... 29 Introduction Small, Complex Societies Small-Scale Social Environments The Small-Scale Syndrome Institutional Barriers and Capable Leadership Utility Regulation Politics and Jurisdictional Capacity in Islands Community Empowerment Political Resourcefulness Island Ecology, Complexity and Adaptive Capacity Adaptive Capacity to Prevent Collapse Complexity Theory Nature-Society Interaction and Sustainability Chapter Summary Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. VI PART ni. THE RESEARCH CHAPTER FOUR: RESEARCH DESIGN........................................................... 47 Introduction Aim and Scope Limitations of the Study Research Methodology Hypothesis Theoretical Framework and Epistemology Role