3. The Lay of the Land: How Alberta Sources Its Power

In early 2009, the Pembina Institute released Greening the Grid: Powering Alberta’s Future with Renewable Energy. Thereport outlined how the province could use proven technologies to harvest its abundant solar, wind, hydro, and biomass energy resources. It concluded that the province could transition its grid from one based on coal, to one based on cleaner and more diverse supply, including these renewable resources, within 20 years.

Five years later, Alberta has made some progress in diversifying its electricity system and cutting energy waste.

Since 2009 the province has almost doubled its installed wind power—adding more than 500 MW of capacity to reach 1,120 MW of operating capacity (with another 300 MW to begin operation in 2014), and supplying more than five per cent of the electrons sent over the wires in 2013. While Alberta still has no utility-scale solar generation, more than 700 small scale systems have been installed under a regulation that allows Albertans to install their own solar systems. While this only accounts for 2–3 MW of supply on a 14,000 MW system, the amount has increased several times over in the past five years.

The Alberta Electric System Operator (AESO) proved an early leader in facilitating grid access for wind. But it has taken more than this to bring turbines to the province. Because of the way that the province’s deregulated electricity market is structured, many wind farms would not exist without targeted support, which is no longer available.

For example, in 2011 Calgary-based Greengate Power signed a 20-year purchase agreement that provided a California power utility with renewable energy credits. The agreement helped to finance a 150 MW wind farm in central Alberta and another separate 300 MW project southeast of Calgary.

Ottawa also provided support. Between 2002 and 2012, two federal government programs helped bring most of the province’s other wind projects online. Those federal programs have since expired, while California credits are no longer practically available for new projects in Alberta.

Biomass has also played a modest role. Since 2009, Alberta power developers have connected around 72 MW worth of biomass energy onto the grid. Again, those projects benefitted from a provincial production incentive that is no longer available.

Alberta has also made progress on energy efficiency. For example, since 2010 the Climate Change and Emissions Management Corporation—an arm’s length government organization chartered to reinvest the proceeds of a carbon levy on major industrial polluters—has invested approximately $37 million in support of energy efficiency initiatives in the province.

While these are positive steps, most of Alberta’s renewable energy resources lie fallow. The grid remains around 85 per cent fossil fuel powered—and most of that power comes from burning coal.

The numbers are arresting. Alberta’s 18 coal power units make the province’s electricity the highest polluting in the country—contributing more than half of the total carbon pollution from electricity generation in all of Canada. The plants also release nearly the same volume of greenhouse gases as the province’s oilsands sector, as shown in Figure 1.

In 2011, Alberta coal power plants produced 113,000 tonnes per day of greenhouse gas pollution (measured as CO2 equivalent). Each year, that adds up to over 40 megatonnes. That’s the same amount produced by roughly half of all cars on the road in Canada today.

Some people in Alberta’s government and electricity industry occasionally defend the sector’s pollution record by pointing to the United States—where coal remains a leading source of power generation. But the data hows the U.S.’s coal power reliance is falling considerably faster than Alberta’s.

Last year, coal power generation supplied 39.1 per cent of the electricity in the United States, whereas it generated 63.7 per cent of electricity in Alberta’s grid. Between 2007 and 2013, total coal power generation in the United States decreased by 21.3 per cent; over the same period, it decreased in Alberta by 13 per cent.

Meanwhile, following a contractual obligation, in late 2013, generation company TransAlta returned a pair of idled coal units to service. As a result, coal power generation actually grew from 2012 to 2013, and could grow further yet, before it shrinks. Our analysis indicates that coal power generation in Alberta could nearly return to peak 2007 levels (with all units fired up) before federal rules kick in that will eventually require them decommissioning of older plants.

What’s the result? For a given gigawatthour of electricity generated, Alberta’s grid emits about 800 tonnes of equivalent greenhouse gases; the United States’ national grid emits 500.

In contrast, an Alberta grid powered primarily by renewable energy could diversify the economy, buffer customers from future price shocks, provide rural economic development opportunities, and of course reduce  pollution and greenhouse gases.