Overview of Surface Water Allocation in the NSR Watershed NSWA FORUM October 4, 2016

Major features: Approaching 1.4 million people 20 counties, urban growth 2 hydro-electric reservoirs 3 coal fired power plants + gas Large petrochemical sector Large agriculture sector Large forestry sector Oil and gas exploration 12 water sub-basins Extensive recreational demand

Water Licencing Terminology Licences permit water diversion and use, stating: Annual volume, rate, & timing (Allocation) Estimates of consumptive use, losses and return flow Source and diversion location Purpose Priority date Allocation = Consumptive Use + Losses + Return Flow Licenced Use = Consumptive Use + Losses Return Flow = Allocation – Consumption - Losses

Original Study - Prepared by amec 2007 - Based on AEP data to 2005 - Surface water & groundwater, licences and registrations - Separate analysis for each sub-basin - Projected future water actual use in 5 year increments to 2025

Original Study - 7 use categories: Municipal Agricultural (livestock & irrigation) Commercial Petroleum (upstream, plants & refineries) Industrial (power & chemical plants) Other (water management, drainage, flood control, stabilization, wetlands)

Key Results Allocations total nearly 2 million dam3 About 27% of average annual NSR flow Industry is allocated the most water by far, mainly for cooling

Key Results Licenced use only 400,000 dam3 (20% of allocation), rest is returned to source Industry has the largest licensed water use, but Petroleum and Municipal are also significant

Key Results Actual use was only 200,000 dam3 in 2005 (10% of allocation, 50% of licenced use, 2.7% of average annual NSR flow) Industry the largest actual user, but Petroleum and Other also large

Key Observations Allocation, licenced use and actual use occurs primarily in 3 central sub-basins

2015 Update - Some data entries appear to be incorrect - Accessed AEP licence and water use reporting databases - 37K entries, removed 11K groundwater, 9K expired/cancelled and 1K with 0 allocation - Used the 400 largest licences,>99% of total allocations - Results preliminary, what’s on paper may not match reality - Some data entries appear to be incorrect

Sources of Surface Water - 58% of water allocated is from the NSR mainstem - 39% is from Wabamun Lake, the 2 largest licences in the NSR watershed

Allocations & Licenced Use Cooling is still the largest allocation and licenced use Plants licenced to use almost as much - Municipal licenced use is much smaller

Cooling - Wabamun Power Plant closed 2010 - Rossdale Power Plant closed 2008 - Clover Bar converted to peaking power 2008 - Reduction in “active” allocations of 1,400,000 dam³ - Allocations still in use <200,000 dam³

Cooling - Two new licences for 12,000 dam³since 2005 - Further retirements of remaining coal-fired units - New gas-fired plants needing less cooling water

Municipal - ~170,000 dam3 allocation - Majority, ~150,000 dam3, Edmonton/Epcor - Virtually unchanged since 2005 - Licenced use is small due to return of treated wastewater effluent to surface water system - Epcor provides water to a wide and growing region outside Edmonton

Petrochemical and Industrial Plants - About 95,000 dam³ allocated in 2005, almost all in Capital Region - Celanese Plant closed (8,000 dam3 allocation) - Six new Upgraders expected, only one built - Allocations have increased by ~40,000 to ~135,000 dam³

Remaining Uses - Injection declined from ~36,000 to 28,000 dam3 - Irrigation uses increased from ~16,000 dam3 to ~19,000 dam3 - Stabilization unchanged ~12000 dam3 - Wetlands allocation increased by 500 to ~5000 dam3

Concluding Comments - Substantial decrease in “active” water allocations since 2005 - Are there other large “inactive” allocations - What will be done with “inactive” allocations - Need to verify licence database - Need to verify actual water use, expect decrease since 2005 - Need to project future additional allocations and use