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Alberta ‘unfairly’ targeted renewables in moratorium: Pembina

Report argues for more even-handed approach to energy project approvals

Pembina InstituteThe seven-month moratorium on renewable energy projects in Alberta “unfairly targeted” the clean energy industry, according to a report by clean energy think tank Pembina Institute.

Scheduled to end Feb. 29, the moratorium has paused development on renewable energy projects because of questions around land use, reliability and impact on viewscapes. It halted approximately 118 projects worth $33 billion of investment, according to one calculation.

But Pembina argues such a move was unnecessary as the questions around renewable energy were already being addressed by the system operator, and affected just the renewables industry despite other industries having greater impact.

“When the moratorium was first announced, we had said that many of the issues the government brought up are valid reasons for policy changes and in fact many of them were already underway,” Jason Wang, a senior analyst at Pembina’s electricity program and co-author of the report, told Sustainable Biz Canada in an interview.

“What we didn’t need in the province was a seven-month pause on all project approvals in order to answer those questions.”

With the Alberta Utilities Commission set to release recommendations to the Alberta government about the freeze, Pembina released a set of criteria to analyze the fairness of the prescriptions compared to other land-intensive sectors.

“Whatever policy approaches are implemented need to be reasonable, consistent with other sectors, and not just become an artificial barrier for renewable energy uniquely,” Wang said.

A fair pause?

No moratorium was placed on any other sector, he said, despite the oil and gas sector having a similar disruptive effect under the criteria cited as reasons for the pause. There are a “plethora of issues” surrounding the oil and gas sector such as reclamation and liabilities, abandoned wells, tailings ponds and leaks, Wang added.

“All of those types of issues outweigh the magnitude of renewable energy by a couple of orders,” he said. For example, he said, the conventional oil and gas sector is 125 times more land intensive than wind and solar development.

Based on a set of seven criteria, Pembina will evaluate if “reasonable changes” were made by the Alberta government after the moratorium is lifted, by comparing the outcomes to other sectors.

One criteria looks at companies’ ability to develop projects with willing landowners. Currently, landowners must consent to development of renewable energy on their land, but in the case of oil and gas production, landowners can be compelled to provide surface access to companies, Pembina writes.

Renewable companies are held accountable to meet reclamation security requirements under contract with the landowner. But oil and gas companies must meet provincial regulatory requirements that “do not include security and offer no recourse to landowners if the company ceases production, but does not secure the wellbore and reclaim the site.”

A fair outcome would require a proportion of reclamation costs be provided upfront and more as the project nears end of life, the report states.

Other balanced outcomes according to Pembina include applying the “pristine landscape” requirement to all large-scale developments, allowing development of renewable projects on Crown land, and not singling out renewable energy in market changes.

‘Slammed the breaks’ on renewables

The moratorium created “tremendous uncertainty” for renewable energy companies in Alberta, Wang said. It “slammed the brakes and shocked the entire industry on energy development in the province and on what Alberta was saying to investors,” he added.

Though companies did not cancel projects, all of them were put on ice, leaving many companies to refocus on other jurisdictions, Wang explained.

More uncertainty is brewing. The end of the moratorium completes the official pause, but the utilities commission that grants the final approval will not publish its findings until the end of March, according to Wang. The Alberta government has not indicated if such a report will be public, what will be done with it, or if a decision will be made quickly.

Some renewable developers, he said, consider this a “soft moratorium.”

Pembina’s report is being reviewed by Alberta’s Ministry of Affordability and Utilities, Wang said, and he hopes it will be considered for future decisions.

“We’re hoping that Alberta realizes it’s the highest-emitting province in Canada but there is a tremendous potential for renewable energy in the province. Alberta can be positioned to continue to be a leader in the clean energy transition,” he said.

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