Green power deals fuel Alberta market

Growing number of corporate customers buying direct from wind, solar producers

From energy firms to tech giants and food and beverage chains, a growing number of North American companies are signing deals for green electricity and spurring excitement within Alberta’s wind and solar industries.

At a first-of-its-kind event in Calgary Thursday, the members of Business Renewables Centre-canada gathered to discuss opportunities related to corporate renewable energy procurement. A non-profit initiative founded by the Pembina Institute and modelled on a successful U.S. program, Brc-canada aims to spur the growth of the renewables sector by serving as a modern marketplace where businesses can learn how to source green electricity directly from developers.

Non-utility procurement of green electricity is not a new concept in Alberta. For years now, a consortium of Alberta school boards have been purchasing power directly from a southern Alberta wind farm to offset the electricity needs of up to 500 schools and the City of Calgary also sources green power for its Ctrain system in this way.

But the concept has not taken off here as quickly as it has south of the border, where companies such as Facebook, Amazon, Nike, Starbucks and Exxonmobil have all signed power-purchase deals with wind and solar companies to enhance their own environmental performance or meet mandated emissions-reductions targets. In 2018, U.S. companies secured a total of six gigawatts of green electricity through private procurement.

“2018 was a real turning point in the U.S., doubling the amount of deals from the year before,” said Sara Hastings-simon, Brc-canada’s founding director and a senior fellow at the Pembina Institute. “The marketplace started off small with just a few companies dipping their toes in the water and then it became a situation where businesses saw their peers doing it and said, ‘I should do this, too.’”

Hastings-simon said there are signs Alberta’s market could be close to a turning point as well. Earlier this month, Calgary-based Perimeter Solar Inc. announced that TC Energy (formerly Transcanada Corp.) has agreed to purchase 74 MW of electricity from its proposed Claresholm Solar project about 125 kilometres south of Calgary.

And this week, the Canadian subsidiary of Warren Buffett’s Berkshire Hathaway Energy announced plans for a $200-million, 117-MW wind farm near Medicine Hat. BHE Canada said a large Canadian corporate partner has signed a long-term power-purchase agreement for the facility, though that partner has not been publicly identified.

William Christensen, vice-president of corporate development with BHE Canada, said signing a long-term power offtake deal makes it easier for renewable developers to finance the costs of their projects. And he said since the cost of renewable energy has come down so much in recent years, some corporate customers are actually choosing to purchase

If you look at what’s happening in the U.S., that’s really what we expect to have happen here or hope will happen here.

green electricity contracts as a hedge against future electricity prices.

“If you look at what’s happening in the U.S., that’s really what we expect to have happen here or hope will happen here,” Christensen said. “There’s lots of entities that have not only made a commitment to become carbon neutral or procure green energy, but are also looking at economics and that’s who we’re really looking to be able to sell to.”

Evan Wilson, regional director for the Canadian Wind Energy Association, said Alberta’s open and competitive wholesale electricity market gives this province a leg up when it comes to growing the renewables sector through corporate procurement.

“Alberta is the only place in Canada where you can do this in a straightforward manner,” Wilson said. “So that combined with a price on carbon through TIER (the UCP government’s carbon pricing system for large-scale emitters), which we’re expecting details of very shortly, really is building excitement from our members about these types of transactions.”

In attendance at Thursday’s Brc-canada event were many of Alberta’s green power companies as well as representatives of large corporations — including TC Energy, Cargill and Amazon — that have either purchased green electricity in the past or are interested in doing so.