Alberta’s New Renewable Energy Rules ‘Patently Unfair’

• The Pembina Institute estimates Alberta's position on restricting land for renewable energy development may cost the province 42 solar and wind projects 
• This represents CAD 11.1 billion investment, but the impact may be underestimated as the government still needs to define protected land 
• CanREA says the recently launched AESO consultation for REM Recommendation brings more uncertainty to the market 

Canadian clean energy thinktank Pembina Institute says the Alberta government's decision to keep renewable energy projects from accessing agricultural land may negatively impact 36 solar projects and 6 wind energy facilities. 

These projects represent 6.3 GW of renewable energy generation capacity with a total investment value of CAD 11.1 billion ($8.23 billion). 

Pembina is referring to the Alberta government's recent guidelines to ban renewable energy development on agricultural land and creating buffer zones of 35 kms around protected areas and other pristine viewscapes. These guidelines were announced as the province lifted its short-term moratorium on final approvals for renewable energy projects (see Canadian Province Lifts Pause On Renewable Energy Projects). 

According to the analysts, this decision will impact projects that have already submitted applications for full approval by the Alberta Utilities Commission (AUC) and proposed projects that are earlier in their development process, it adds. 

Out of a total 111 solar and 34 wind energy projects proposed in Alberta, the institute says these 36 solar projects include 28 proposed and 8 already awaiting approval from the AUC. Of the 6 wind energy facilities, 5 are proposed and 1 awaiting AUC approval. 

Pembina cautions that since the government is yet to define 'protected areas or other pristine viewscapes' with regard to the 35 km buffer around national parks, this may underestimate its impacts. 

Calling these restrictions on renewable energy sector 'patently unfair,' the thinktank draws comparisons with other industries that are not subject to a ban of this sort, especially the province's conventional oil and gas industry. Alberta is a leading oil producer for the world. 

"Proposed projects waiting to be built would bring in $36 billion of investments and $277 million in annual revenue for municipalities by 2028 if allowed to proceed," said Pembina's Senior Analyst Jason Wang. "Creating these unfair restrictions and hurdles for the renewable energy sector means industry will be taking their investments, and the job opportunities that accompany this, to other provinces and U.S. states that are not impeding renewable energy growth." 

Meanwhile, the Alberta Electric System Operator (AESO) has opened a consultation to prepare a technical design on Restructured Energy Market (REM) Recommendation to which the Canadian Renewable Energy Association (CanREA) has expressed concerns. 

The association explains that these proposed reforms include a day-ahead market, an administrative scarcity pricing mechanism and adjustments to the current pricing systems. The overarching goal of AESO is to ensure system decarbonization by 2050. 

AESO consultation will be completed by fall 2024 for the new market rules to come into effect in 2027. 

CanREA believes this adds another 'significant layer of uncertainty' for the renewable energy market of Alberta, making it less attractive for investors. 

"We expect to be at the table, working to ensure the new market design recommendations work for existing renewable energy and energy storage assets and their customers, while also providing a path forward for future investment in these critical technologies in Alberta," said CanREA's President and CEO Vittoria Bellissimo.