Renewable sector seeks fairness
Developers wary of new rules, barriers
CONVENTIONAL OIL AND GAS DOESN’T NEED TO POST SOME KIND OF SECURITY. I IMAGINE ALBERTA WOULD BE THE ONLY JURISDICTION IN THE WORLD TO CONSIDER RENEWABLE ENERGY RISKIER THAN OIL AND GAS DEVELOPMENT. — SIMON DYER, PEMBINA INSTITUTE
Alberta’s controversial pause on approving new renewable energy projects is slated to end Thursday, and industry developers say they’re looking for one principle to guide its outcome and future investment in their sector. Equitable treatment. The industry was stunned by the UCP government’s decision last August to place a moratorium on approving new renewable projects while it examines policy issues surrounding the sector’s rapid expansion.
With the freeze expected to end this week, wind and solar developers will be watching to ensure projects aren’t facing extraordinary new rules or barriers that other industries don’t face when it comes to accessing land, or mandatory remediation requirements once a facility reaches the end of its life.
“Those are all valid things to review in the context of a fast-growing industry like renewables, but the moratorium was unnecessary,” said Dan Balaban of Calgary-based Greengate Power, one of the largest renewable developers in the province.
“That didn’t seem like a fair move to me. So, I hope that whatever comes out of the inquiry will be fair.”
The Alberta Utilities Commission (AUC) has examined the sector’s speedy development and the implications of its growth on the use of prime farmland for wind and solar farms, along with the effect on “Alberta’s pristine viewscapes,” and the possibility of mandatory reclamation security requirements for new projects.
In 2022, Alberta’s deregulated energy market was home to more than 75 per cent of all newly installed renewable energy capacity added in Canada, growing to more than 90 per cent last year, according to the Canadian Renewable Energy Association.
Alberta added 1.7 gigawatts (GW) of installed renewable capacity in 2023, as previously approved projects weren’t affected by the moratorium.
At the time, Affordability and Utilities Minister Nathan Neudorf said the pause was necessary as “Alberta has a bit of a Wild,
Wild West feel to it,” with a surge of projects brought before the AUC.
Earlier this month, Premier Danielle Smith said the province will not allow the “sterilizing” of prime agricultural land by projects, indicating developers would have to consider using marginal farmland or adopt agrivoltaics, which allows for solar generation and agricultural production.
She also suggested Alberta’s plan would need to ensure money is set aside by operators for future cleanup costs.
“It is totally appropriate to talk about the need for all industrial projects to post some kind of security, but conventional oil and gas doesn’t need to post some kind of security,” said Simon Dyer, deputy executive director of the Pembina Institute.
“I imagine Alberta would be the only jurisdiction in the world to consider renewable energy riskier than oil and gas development.”
On a weekend radio program, Smith reiterated the pause will come off Thursday and said the province will provide more clarity about adding renewables to the electricity grid in the future.
She also pointed to the extreme cold weather last month, when the province’s grid operator issued an emergency alert and considered imposing rolling blackouts amid high power use and a lack of electricity generation.
“We need to bring on a responsible amount of wind and solar and always ensure that we have enough baseload dispatchable power so that it can be backed up. So, it might be a slower pace of growth,” the premier said.
The Canadian Renewable Energy Association recommends there not be any retroactive policy changes that affect projects already built or filed with the AUC.
The industry group is calling for the government to adopt “reasonable” reclamation security requirements — using estimates made by experts in the field — and it opposes a blanket ban on land use for new projects, said Evan Wilson, vice-president of policy with the Canadian Renewable Energy Association.
“Let’s move forward in a way that is constructive and not about the government deciding what we can and can’t do, but more about providing transparency on how we are doing,” Wilson said Monday.
Many players in the industry note that rural landowners decide if they want to strike agreements that allow wind or solar developments on their property.
Rural Municipalities of Alberta president Paul Mclauchlin said he hopes to see standardized rules around reclamation — some agreements with landowners already include them — and he points out land use needs to involve community planning conversations.
“I fully believe in landowner rights but, at the same time, also believe in landowner rights for your neighbour. The fact is, you can’t do whatever you want on your land,” said Mclauchlin, who is also the reeve of Ponoka County.
“This is a good day for renewables. I think the opportunity is still there and it will never go away. And it requires just a little more front-end, sophisticated discussion by the industry, landowners, as well as the regulator.”
Aside from renewable development, the provincial government is also reviewing the overall design of the electricity market in Alberta, and other aspects of the power system.
The head of Transalta Corp., the province’s largest power generator, which has both renewable and gasfired units, said stability is critical to making long-term investment decisions.
“We’re close to getting some of that certainty or clarity from an Alberta market perspective over the course of the next probably 45 days or so,” Transalta CEO John Kousinioris said Friday on an analysts’ call.
Greengate, which developed the country’s largest solar farm — the Travers Solar Project, southeast of Calgary in Vulcan County — is also waiting to see what comes out of the ongoing examinations. Any decisions coming out of the pause will influence how it views future investment opportunities in its home province.
“What we really need to do is get through those reviews as soon as we reasonably can, put in a set of rules that are fair and let the industry get back to doing what it does,” Balaban said.
“We’re waiting to see how things unfold before we decide if we’re going to invest in any new renewable projects in Alberta.”