Renewable Energy

With its wide-open spaces, and agricultural sector, Alberta has the renewable resources to become a powerhouse in solar, wind, and bioenergy. However, renewables accounted for less than a quarter of the province’s installed capacity in 2014. Home to Canada’s first commercial wind farm, Alberta hosts 1,500 MW of installed wind capacity, rendering it third in Canada in wind development [i]. While wind development has been relatively successful, its potential has been limited by its incompatibility with a coal-heavy electricity grid [ii], as well as risks to wind generators, especially smaller ones, posed by the inherent price uncertainty in the spot market [iii].

Much of the province’s hydro resources remain untapped. If developed, they could more than double current hydro production. Yet, nearly all of this new hydro potential consists of mainly run-of-river sites located in the north, far from concentrated demand [iv]. It also has significant untapped potential in bioenergy and solar power; the former due to Alberta’s abundance of agricultural waste and the latter due to its sunny climate. While Solar photovoltaics currently account for only 2 MW of capacity [v], development is anticipated to accelerate under the NDP whose election platform called for expanding solar and wind capacity and ending “costly and ineffective” Carbon Capture and Storage (CCS) investments[vi].

Policy Mechanisms

The Micro-Generation Regulation is Alberta’s only consumer incentive to develop renewable energy projects. It allows individuals using renewable[1] or alternative[2] energy resources to generate their own electricity and receive credit from any excess electricity they sell to the AESO. Eligible projects are limited to 1 MW of capacity. The Solar Energy Society of Alberta maintains a comprehensive list of solar case studies that demonstrate the types of micro-generation projects.

The inherent price uncertainty over the mid-to-long-term horizon in Alberta’s deregulated market makes it challengin to secure the long-term financing needed for developing large renewable projects. Several policy innovations have been identified as having the potential to overcome the barriers posed by the deregulated market and accelerate both microgeneration and larger renewable projects, including:

  • A Clean Electricity Standard that imposes a maximum greenhouse gas (GHG)-intensity level on electricity sold by retailers.
  • An increase in the $15/tonne carbon price currently imposed on large emitters under Alberta’s Specified Gas Emitters Regulation.
  • Adopting a Feed-In Tariff Program, which offers long-term contracts to renewable energy producers based on the cost of generation of each technology.

 

[1] Wind; solar; biomass; hydro; geothermal

[2] Natural gas cogeneration; fuel cells; use of waste energy; electricity or natural gas used for transportation

[i] Canadian Wind Energy Association. Alberta. Retrieved 5 Aug 2015 from http://canwea.ca/wind-energy/alberta/.

[ii] Conference Board of Canada. 2015. Finding the Mix: The Choice of Generation Technologies in Canada. Retrieved 14 Oct 2015 from http://www.conferenceboard.ca/temp/f2ec4e17-0eba-4fa6-ac94-16d1563b8ade/7346_findingthemix-rpt.pdf 

[iii] Blackwell, R. “Alberta NDP’s rise to power raises hopes for renewable energy”, The Globe and Mail, 10 May 2015. Retrieved 4 August 2015 from http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/alberta-ndps-rise-to-power-raises-hopes-for-renewable-energy/article24359711/.

[iv] Conference Board of Canada. 2015. Finding the Mix: The Choice of Generation Technologies in Canada. Retrieved 14 Oct 2015 from http://www.conferenceboard.ca/temp/f2ec4e17-0eba-4fa6-ac94-16d1563b8ade/7346_findingthemix-rpt.pdf

[v] Energy Society of Alberta. Alberta Solar Generation. Retrieved 6 Aug 2015 from http://www.solaralberta.ca/.

[vi] Blackwell, R. “Alberta NDP’s rise to power raises hopes for renewable energy”, The Globe and Mail, 10 May 2015. Retrieved 4 August 2015 from http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/alberta-ndps-rise-to-power-raises-hopes-for-renewable-energy/article24359711/.

[vii] Bickis, I. “Alberta could kick coal habit under incoming Premier Rachel Notley”, The Globe and Mail, 13 May 2015, retrieved from http://www.theglobeandmail.com/news/alberta/alberta-could-kick-coal-habit-under-incoming-ndp-premier-rachel-notley/article24415648/, 4 Aug 2015.

[viii] CBC. “Alberta’s climate change strategy targets carbon, coal, emission.s” Retrieved Nov 25 2015 from http://www.cbc.ca/news/canada/edmonton/alberta-climate-change-newser-1.3330153

 

Image attribution: “A Lone Wind Turbine” by thor_mark is licensed under CC BY-NC-SA 2.0

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