Emera rides Alberta’s push for clean energy
CALGARY • Alberta’s aggressive climate- change plan is causing anxiety among its energy consumers and producers, who have historically relied on abundant fossil-fuel resources. But at least one company, Emera Inc., is excited about its forced transition to clean energy.
The Halifax- based utility holding company has opened a business development office in Calgary’s depressed market and is scouting for opportunities to build clean- energy projects or acquire existing ones, bucking the long- established trend of Alberta- based energy companies t aking their investments and expertise eastward.
Alberta’s economy is hurting from the collapse in oil and gas prices as well as uncertainty from policies introduced by the new provincial NDP government. Among them is a climate-change plan that involves accelerating the retirement of coal-fired plants in favour of subsidized renewable energy, mostly wind power.
Under the plan, announced last month, 30 per cent of Alberta’s generating capacity would come from wind and solar by 2030. Today, 18 coalfired plants generate 55 per cent of Alberta’s electricity. The province plans to hold auctions of renewable energy to enable the switch.
The policy changes are providing an entry point for Emera, which had been looking at Alberta’s open power market for some time, said Christopher Huskilson, president and CE O of Emera, which has operations in Eastern Canada, the United States and the Caribbean that serve 2.5 million customers.
“Almost everywhere we do business, it starts out as a high- carbon region, then more and more investments happen and it moves to low carbon,” the engineer said in an interview in Calgary this week, where he was taking a first-hand look.
“Alberta is a very interesting market to us because we can see the transition beginning and that is a very exciting time.”
But Huskilson also said the move to clean energy needs to be done at a pace that makes it affordable.
“We work on approaches that create the cleanest energy at the lowest possible cost, so that ( customers) can afford it because that is an important piece,” he said.
“Change is always tough, and that is one of the things that we work on. That is why we think about it as clean, affordable energy because then it becomes something that customers embrace.”
Alberta’s plan involves an economy- wide carbon tax expected to collect more than $3 billion a year by 2018 and that caps emissions from oil production in the oilsands.
There are widespread concerns that the new tax will boost the cost of living and of doing business in the prov- ince, while the early retirement of coal plants and the oilsands emissions cap could lead to stranded assets that could leave taxpayers with hefty bills.
The transition to cleaner energy has hit Ontarians hard. In a report this month, the province’s auditor general said they paid $37 billion above market price for power over the past eight years due to mismanagement.
Huskilson said Emera has developed expertise over the past decade to move from high- carbon sources to lowcarbon sources. The publicly traded company, which grew from a Nova Scotia base, was under government pressure to move from high reliance on coal- fired generation to clean energy like wind power and hydro.
The transformation i nvolved upfront costs, but has been beneficial for consumers, who moved away from usually volatile fossil fuel prices to more stable clean energy prices, Huskilson said.
Emera has since grown its portfolio of renewable energy and natural gas projects.
In partnership with Nalcor Energy, the Newfoundland and Labrador energy Crown corporation, Emera has invested in the Lower Churchill hydroelectric project and the maritime link that will bring the electricity from Newfoundland to Nova Scotia by the end of the decade. By then, Nova Scotia will be about 70 per cent reliant on clean-energy sources, from 90 per cent powered by coal before the transition.
In September, Emera acquired Florida power utility Teco Energy Inc. for US$ 6.5 billion, doubling its asset base to US$ 20 billion. Teco was under pressure by the Obama administration to reduce greenhouse gas emissions and build up renewable power.
Huskilson said it’s too early to tell what Emera will do in Alberta. The company wants to first understand the market, government policy direction, customer needs, and other market participants.
The company could i nvest in renewable wind and solar generation, electricity transmission, and natural gas, which under the climatechange plan would be a backup to renewable energy.
Then it becomes something that customers embrace