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‘We are closed for business’: Pause on renewables draws ire from industry, opposition

The Alberta NDP, along with a renewable energy industry leader, are saying Alberta is closed for business—as long as the recent moratorium on renewable energy projects remains.

The Government of Alberta had announced on August 3 that the Alberta Utilities Commission would be pausing for seven months, any applications and approvals of renewable energy projects in the province over one megawatt.

That pause also came into effect on August 3.

“I’m stunned by the decision of the government to pause all large-scale renewable energy projects. I’ve never in my career seen something like this happen here in Alberta,” said David Kelly, CEO of Skyfire Energy.

“There was no inkling, there was no warning that the UCP would shut down our entire industry. I don’t know anyone who was consulted about this plan… none of the industry leaders that I’ve spoken to heard anything about this.”

Kelly said that the moratorium would have a wide range of impacts on the renewable industry in Alberta, from decreased investment to skilled workers leaving the province to seek work elsewhere.

“There could be a lag in installations in the province. We’ve got this trained workforce, not only ourselves but other companies, that people are going to migrate elsewhere if there are no jobs in Alberta,” he said.

Kelly said that his company, which typically works on commercial projects unaffected by the megawatt requirement, and on larger scale projects—like one with TC Energy—that have already been approved, has not yet been affected by the AUC pause.

Future projects though, said Kelly, have been put into jeopardy.

“While 2024 looks okay, there may be delays on projects into 2025 or 2026. Hopefully, this gets resolved very quickly, and we can speed those projects through the approval process,” he said.

“We only have to look at Ontario where the government’s decision to cancel over 700 new renewable projects cost the people of Ontario over $200 million. I’m deeply concerned with how much this senseless moratorium will cost the people of Alberta.”

Premier Smith blames federal government for provincial decision

Premier Danielle Smith spoke on Corus Radio’s Your Province, Your Premier on August 5, defending her government’s decision to pause renewable energy approvals in the province.

The AUC pause was ordered by Minister of Affordability and Utilities, Nathan Neudorf, under an order-in-council on August 2. That same order required the AUC to hold an inquiry on renewable energy in the province, and report to Minister Neudorf by March 29, 2024.

“The Alberta Utilities Commission, the Alberta electric system operator, and the rural municipalities Association, all asked us for a pause,” said Premier Smith.

“So when I hear all of my municipal leaders and my two principal regulators saying we got a problem, I have to listen to that. It’d be irresponsible of me to ignore that.”

In an announcement directly by the AUC on August 3, they said they would be giving 15 days to interested parties (until August 18) to let stakeholders provide feedback on whether there should be a complete abeyance on applications, a partial abeyance on applications, or a hold on approvals only.

Premier Smith blamed the federal government during her program, for making it difficult to create backup generation for renewable sources and necessitating the pause.

“Every time you bring wind and solar on the grid, you have to have a backup. What we have is natural gas peaker plants, so when the wind doesn’t blow and the sun doesn’t shine, you bring on natural gas to cover the gap. The federal government doesn’t want us to add any new natural gas to the grid,” the Premier said.

“So I’ve told them, how can I bring on additional wind and solar, if I’m not able to secure the reliability of my power grid, by being able to bring on natural gas peaker plants… that’s at the heart of the problem.”

She also said that there was a need to add a reclamation cost for renewable energy, to bring the costs in line with what oil and gas companies have to pay to reclaim land at end-of-life for their extraction sites.

“When you look at a wind installation, maybe it has 50 turbines, it’s a huge amount of additional steel, fiberglass, massive amount of concrete construction. What happens when that gets to its end of life? Who pays for that to be removed? We don’t have a system in place,” Smith said.

Pause would affect more than just construction

Kelly said that companies looking to build these projects go through many steps, even before a company like Skyfire Energy that builds the project, ever gets involved.

“The entire sector is focused on addressing reclamation and ensuring sustainability. But instead, it’s only the renewable sector that is being singled out by the UCP, and it will have an impact and a cost to Albertans,” Kelly said.

He said the focus on sustainability means investments into the Alberta economy long before the first solar panel is ever installed.

“The developers that are developing these projects go through various stages through the AUC. They’re looking for leases with landowners, so they’re making payments ahead of time. There’s money being invested there,” Kelly said.

“They do environmental studies, they do impact connection studies. They do pile testing, and geotechnical studies prior to a project being built. So all those investments now are at risk.”

Alberta NDP Critic for Energy, and Climate on Electricity, Utilities and Renewables, Nagwan Al-Guneid, said that the pause would also be affecting Alberta’s oil and gas industry.

“The reality is that many oil and gas companies, and even oil sands companies like Imperial and Cenovus, are also buying renewables,” she said.

“There are serious climate commitments, serious social and environmental commitments that these companies have. So, absolutely, I worry that we are sending, or this government is sending, a very confusing message to investors and companies and international corporations that we are closed for business.”