Saturday, August 26, 2023

UCP CUTS NOSE TO SPITE FACE
Billions in renewable investments stalled as Smith reiterates allegiance to oil and gas

By Natasha Bulowski | August 24th 2023

A wind farm is shown near Pincher Creek, Alta., in a March 9, 2016, file photo. 
THE CANADIAN PRESS/Jeff McIntosh

Alberta Premier Danielle Smith doubled down on her support for the oil and gas industry, just as a report showing her government’s pause on renewable energy development could jeopardize investments worth billions.

“We don’t need a just transition because we don’t intend to transition away from oil and natural gas,” Smith said this week at the Canadian Energy Executive Association conference in Banff. The industry is working to reduce greenhouse gas emissions, but will not transition “away from production,” she noted.

On Aug. 3, Danielle Smith’s United Conservative Party government kneecapped Alberta’s clean energy industry with a surprise announcement on approvals of all new renewable energy projects over one megawatt.

A report released Thursday shows Alberta's seven-month moratorium on renewable energy development has stalled 118 projects representing $33 billion in investments.

Pembina Institute combed through public data to figure out how many projects are affected by the seven-month moratorium and what this means for investments, revenues and jobs in Alberta.

The 118 projects identified are comprised of 5.3 GW of wind, 12.7 GW of solar and 1.5 GW of battery energy storage for solar projects.

The total investments supporting these projects are estimated at a little over $33 billion from projects proposed by 64 companies or partnerships. Pembina Institute also calculated another $263 million per year in revenue from municipal taxes and land leases spanning 27 different municipalities that won’t be realized until the projects move forward. According to the analysis, the planning, development and construction phase would create, over the span of several years, the equivalent of one year of 24,000 full-time jobs.

The province is well-positioned to become Canada’s “renewable energy capital,” the new analysis points out. Last year, Alberta led Canada for renewable energy growth, accounting for 77 per cent of the 1.8 gigawatts of solar and wind generation capacity that came online that year, according to data from the Canadian Renewable Energy Association.

When he announced the pause, Nathan Neudorf, Alberta’s Minister of Affordability and Utilities, said the move was a direct response to concerns raised by rural municipalities about land use considerations and end of life plans for renewable projects. Abandoned industrial projects are a pain point because many municipalities have been left with the mess from defunct oil and gas wells and are still owed millions in taxes by oil and gas companies: the Rural Municipalities of Alberta says its members are collectively owed $268 million in unpaid property taxes by oil and gas companies, and that number continues to grow.

Alberta's seven-month moratorium on renewable energy development has stalled 118 projects representing $33 billion in investments, according to new analysis by @Pembina Institute #Solar #Wind

During the renewables pause, the Alberta Utilities Commission will review policies and procedures for the development of renewable electricity generation, according to the province.

Rural Municipalities of Alberta president Paul McLauchlin said they did not ask the government to pause project approvals, only raised concerns, but he applauded the decision nonetheless.

Aside from end of life plans, another one of Rural Municipalities of Alberta members’ main concerns is that highly productive farmland will be sacrificed to accommodate large renewable projects. “We want to make sure that projects that are industrial at that scale are compatible with adjacent land uses, or at least those questions are being asked in the decision-making process,” McLauchlin told Canada’s National Observer the same day the moratorium was announced.

McLauchlin emphasized that municipalities are not against renewable energy development — they just want to see it done right.

The revenues being brought in by these projects are “life-changing” for municipalities, said McLauchlin, pointing in particular to Vulcan County, home to Canada's largest solar project and one of the largest wind farms.

Several large renewable energy projects have injected the county with much-needed revenues after years of being stiffed by oil and gas companies.

About a decade ago, the decline of oil and gas decimated Vulcan County’s budget by almost 50 per cent, Jason Schneider, the elected reeve of Vulcan County, told Canada’s National Observer in an interview earlier this month

“We're out about $13 million of unpaid oil and gas taxes,” said Schneider. That's from companies who either just decided not to pay their taxes or companies that disappeared in the middle of the night or went bankrupt, he said.

“Unfortunately, the way the whole industry, the way it was all set up is, you know, these companies were able to walk away and we really had no recourse,” said Schneider.

“$13 million to a small municipality like ours is a big chunk … If you wanted to extrapolate that and compare it to a city … I mean, any city, if you have to cut your budget by 30 per cent, I don't think many municipalities could do it.”

“In the last 10 years, wind and solar has surpassed oil and gas at its peak in Vulcan County,” said Schneider, adding “we're we're able to do things that we weren't able to do 10 years ago, even five years ago,” namely infrastructure investments “thanks to the additional revenues the projects have brought online.”

He doesn’t want this issue to repeat with the rapidly expanding renewables industry. Renewable energy companies make deals with individual landowners, so it's up to landowners to ensure the contract includes a plan to decommission and remediate the site when its operating life is over. Municipalities are left in the dark because the deals are typically confidential.

During the application process, the Alberta Utilities Commission requires companies to show how they will ensure there is enough money to cover the costs of decommissioning the project and restoring the land to its former state.

Pembina Institute’s analysis found that, on average, a 100 megawatt renewable energy project generates between $125 and $175 million in project development and construction investments, about 300 full-time jobs during construction and $1.5 million in long-term, annual municipal revenues.

For example, multiple projects proposed in the Medicine Hat area would generate up to $44 million in annual tax and land lease revenues, according to the analysis. There is just one project — a 160 megawatt wind project — proposed in the Municipal District of Smoky River, in northwestern Alberta. That one project would result in an estimated $1.9 million in tax and land lease revenues per year.

The authors of the analysis point to the Alberta Utilities Commission’s existing requirements for decommissioning and reclamation plans, writing that while improvements can be made to those current measures, the moratorium is unnecessary and hampers stakeholders eager to invest in projects.

Natasha Bulowski / Local Journalism Initiative / Canada’s National Observer

Millions on hold in southeast Alberta with renewables pause: Pembina Institute

MedicineHatNews
BY COLLIN GALLANT ON AUGUST 25, 2023.
The blade of a wind turbine is transported along the Trans-Canada Highway near Suffield in his May 2023 file photo. A new report states the Medicine Hat region could see an annual economic impact of $44 million in direct revenue from municipal taxes and lease agreements with ag producers from green energy projects that are awaiting approval from provincial regulators.-


Renewable power plant proposals that are now on hold could have provided a substantial boost to rural Alberta tax base – and most to the Medicine Hat region – according to a new study by think tank, the Pembina Centre.

It was held up Thursday by the Alberta New Democrats who continued to call the province to reverse a six-month pause on new approvals enacted earlier this month.

That report estimates annual payments to landowners and taxing jurisdictions could total $260 million if 120 wind and solar projects in advanced development were to be built at a total cost of $33 billion.

That includes around $44 million in Medicine Hat and nearby counties from a handful of major utility projects.

“It’s in every region of the province – from Peace River to the U.S. border,” said NDP energy critic MLA Nagwan Al-Guneid during a press conference on Thursday.

“The total investment would be more than the capital investment of the oil industry in 2023, but this is not to pit one industry against another … The scale of the renewables sector holds the potential to diversify our economy.”

According to Pembina, that could provide huge growth in tax assessment base of rural municipalities – as much as 50 per cent in the case of the County of Forty Mile.

Premier Danielle Smith has claimed regulators requested the pause to better deal with a massive glut of renewable proposals. Plans for projects totalling 18,000 megawatts of green power production were analyzed by Pembina. That’s about the size of Alberta’s existing generation capacity.

The Alberta Utilities Commission and Alberta Electric System Operator updated its process Wednesday however, to still include early permit work and hearings, but new rules on siting, reclamation, protecting agricultural land and proximity to power lines may become factors in future approvals.

Al-Guneid says that will quell investment.

“Companies need certainty and (the pause) sends mixed signals to investors looking to bring money into Alberta,” she said.

Cypress-Medicine Hat MLA Justin Wright told the News the halt is needed and will result in “a quick and straightforward approval process compared to other jurisdictions in Canada and North America.”

“(The Alberta sector) has seen tremendous growth and investment over the past several years, including in the Medicine Hat region,” he continued

“This boom in development has created many benefits for our province, including a diversified power market, but it has also led to significant concerns.”

Al-Guneid said the sector is facing a freeze that no other energy producers face, and she worries ranchers and farmers who want to lease to green projects may not be represented in the review.

The Pembina report outlines economic advantages of the projects in a list that estimates tens of millions of new dollars per year of revenue for the counties of Cypress, Forty Mile, Newell and the M.D. of Taber, along with the City of Medicine Hat.

DP Energy’s Saamis Solar project would see a solar array cover more than 1,000 acres of former industrial and grassland in northern Crescent Heights, and was being rescheduled for an approval hearing when the halt on new approvals was announced Aug. 3.

Pembina estimates in a standard formula that annual payments to the landowner (it is being leased from Viterra) and city taxes would total $4.5 million, enough to pick up 3 or 4 per cent of the city’s total annual tax income.

Similarly, a controversial solar project in Cypress County, the Aura Peace Butte, would pay lease payments to the owners of six-quarter sections near Black and White Trail and annual tax amounts totalling an estimated $4.6 million to Cypress County.

The county’s entire annual tax revenue is about $23 million.

The County of Forty Mile collected a total of $16.3 million in property tax in 2023, but a single new project, the six-section Aria Solar Facility, could pay up to $6.3 million per year to county coffers and landowners leasing the sites.

Southeast Alberta projects pause

(A list of renewable energy projects, with applicant, location and combined lease and tax revenue, as estimated by the Pembina Institute).

– Aria Solar, County of 40 Mile, $6.3 million;

– Aura Peace Butte Solar, Cypress County, $4.6 million;

– Bluearth Bindloss Solar, Sp. Areas, $2 million;

– Capital Power Whitla Solar expansion, County 40 Mile, $1.23 million;

– DP Energy Saamis Solar, Medicine Hat city, $4.5 million;

– EDF Bull Trail wind Phase 1, Cypress County, $3.6 million;

– Enerfin Winnifred Wind (modification), Cypress/40 Mile $720,000;

– Engie Buffalo Trial (Phase 1), Cypress County, $2.4 million;

– Greengate Luna (two phases), County of Newell, $18.6 million;

– Alderson Solar, Cypress County, $1.4 million;

– Proteus Hays Solar, MD Taber, $4.3 million;

– Pteragen Peace Butte Wind, Cypress County, $1.4 million;

– RES Forty Mile Wind, Forty Mile, $1.6 million;

– Solar Krafte Vauxhall, MD Taber, $840,000;

– Solar Kraft Ranier, Newell, $6.3 million;

– Atco Forty Mile Wind (modification), Forty Mile, $340,000;

– Transalta Red Rock Wind, Cypress, $1.2 million.

Alberta government releases online fact sheet regarding pause on renewable project approvals

Aug 25, 2023 | 
By rdnewsNOW Staff

Sunset windmills producing green energy on a harvested wheat field with a small rustic barn on a prairie landscape near Pincher Creek, Alberta.
 (Photo 267461257 © Ramon Cliff | Dreamstime.com)

MINISTRY OF AFFORDABILITY AND UTILITIES

The Ministry of Affordability and Utilities has released an online fact sheet regarding the Alberta Utilities Commission’s (AUC) pause on renewable power project approvals.

Minister Nathan Neudorf said the sheet was created ““in response to misinformation being developed and released by interest groups”.

READ: Renewables pause in Alberta affecting 118 projects worth $33 billion, think tank says

“Alberta has a strong renewable energy sector and we are committed to ensuring its ongoing success,” he said in a statement.

On August 3, the Alberta government announced they would be conducting an inquiry into regulations surrounding renewables production to review that the right processes are in place to support continued investment in the industry.

As a result, the province says they directed the AUC to pause approvals of renewable power projects until February 29, 2024 to help the inquiry and ensure that every project will be subject to the same regulations and processes moving forward.

At the same time, the AUC announced it will be engaging with industry partners to provide the best focus to the inquiry and to determine how it will implement a pause on approvals. After receiving a significant amount of feedback, the AUC released a statement earlier this week explaining its approach to the inquiry.

READ: AUC says it will still process applications during renewables moratorium

“This feedback reflects industry’s commitment to ensuring Alberta remains a leader in renewable energy projects while meeting the needs and concerns of Albertans going forward,” said Neudorf.

“I am confident in this process and the clarity it is providing to our partners in the renewable energy space. I also want to reiterate that, throughout the inquiry, the AUC will continue to process applications up to the approval stage for new projects that produce renewable electricity. To be clear, no projects have been cancelled. Projects already underway will continue to be built. Jobs are not at risk.

“We need to protect the reliability and affordability of our electricity grid when it comes to adding intermittent power sources in a short period of time. We also need to consider and address concerns about land usage, reclamation, and protecting Alberta’s world-class views. Following the inquiry, we anticipate that there will be changes to the regulations for renewables in Alberta. Any changes will consider the needs and concerns of regulators, landowners, municipalities, investors and Albertans.

“Alberta has the most investor-friendly system in Canada for renewables and this pause will help set a regulatory standard for all projects to attain now and into the future.”

by rdnewsNOW Staff

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