Alberta electricity regulator opts for least stringent application of renewable energy pause

The Alberta Utilities Commission has offered more clarity on how it will apply the seven-month moratorium on new renewable-energy projects ordered by the Alberta government, opting for the least stringent application of the law.

The provincial government issued the moratorium on Aug. 2, to the surprise of the renewable-energy industry, which wasn't consulted ahead of time.

The AUC, which regulates Alberta's electricity market, was ordered to cease all approvals of new renewable-energy projects until Feb. 29, 2024.

The regulator sought feedback from the industry on exactly how it should apply the new law, however, as it saw three possible options:

• "Complete abeyance," meaning it would stop accepting renewable-energy applications altogether and stop processing applications that were in progress.

• "Partial abeyance," meaning it would not accept new applications but continue processing existing applications up to a certain point.

• "Approval hold only," meaning it would continue to fully process new and existing applications but hold off on issuing approvals until after the moratorium expires.

On Tuesday, the AUC announced it had decided on the "approval hold only" option.

In a written statement, the regulator said it "will continue to process applications up to the approval stage for new hydro developments and power plants that produce renewable electricity while the approval pause period is in effect."

"The AUC is prohibited from issuing approvals until the pause period expires," it added.

'Least worst option'

The move was welcomed — in part — by Jorden Dye, acting director of the Calgary-based Business Renewables Centre, which helps connect developers and buyers in the renewable sector.

"They took the least worst option available to them, in the absence of the government removing this unprecedented moratorium," Dye said of the AUC decision.

Dye had previously urged the regulator "to take every action available to restore some level of investor confidence" by opting to pause approvals only and continue accepting and processing applications.

Cattle graze in front of a bank of wind turbines near Pincher Creek, Alta., in this file photo. (Robson Fletcher/CBC)

Evan Wilson, vice-president of policy for Western Canada with the Canadian Renewable Energy Association, also welcomed the AUC decision as the "least bad" of three options it had.

"Overall we're in a very challenging situation but, that being said, we were pleased that the AUC decided to move forward in a manner that would see them continuing to receive applications and continuing to move things forward," Wilson said.

"Companies have spent years and hundreds of thousands, if not millions of dollars preparing these applications, and we're glad to see that, at the very least, the AUC will continue to accept these applications."

Heather MacKenzie is the executive director of Solar Alberta, a non-profit society that has 900 members who produce power commercially or generate it for personal use.

She also welcomed the regulator's decision, which she sees as an attempt to blunt the impact of the government's moratorium on the renewable sector.

"It looks like the AUC has decided to try and minimize the damage that the Government of Alberta is doing. We applaud them on on that," she said.

Heather MacKenzie, executive director of Solar Alberta, checks out the solar array on the roof of Northern Alberta Institute of Technology in Edmonton in this file photo. (Adrienne Lamb/CBC)

MacKenzie believes the moratorium, itself, is "out of sync" with the previous provincial legislation and should be cancelled.

"The Government of Alberta is supposed to treat all energy in a fair manner and they are discriminating against renewables here," she said.

"And so, rather than pointing that out, I suspect the AUC is just trying to do their part to create a fair playing field that we are all supposed to be legally working within."

New requirements for submissions

One criticism Dye had of the AUC announcement surrounded new rules that will apply to both existing applications and new applications for renewable energy projects.

The regulator says companies will have to comply "with new, interim information requirements relating to such issues as agricultural land, viewscapes and reclamation security."

Exactly what that means is not yet clear, however, and the AUC said more specific information "will be issued shortly."

"By announcing that existing projects that have already been put in the approval pipeline will be required to submit new information that, as of yet, is still unknown, all they've really done is further the climate of uncertainty that we've had from the government and the commission since the start," Dye said.

Wilson, however, said the new requirements are not out line with the type of thing many renewable energy proponents have already been doing as they work with the regulator.

"I actually think that underlines why the decision to move forward with the moratorium was unnecessary," he said. "Because this is business as usual for our members already. The AUC has been putting forward information requests on these issues on projects that are in front of them."

Wilson said the industry remains concerned about what will happen after the moratorium is lifted but in the immediate term, the regulator's decision has allayed fears to some degree.

"Despite this massive uncertainty we're facing, this does build or safeguard at least some small degree of certainty for projects," he said.

"And hopefully people can keep them moving and then, hopefully, after six months, approvals can continue."

Changes to renewable regulation in 2024

Minister of Affordability and Utilities Nathan Neudorf said the province intends to balance growth in renewable energy with concerns around "the reliability and affordability of our electricity grid" as well as "questions around land usage, reclamation, and protecting our world class views."

"Following the pause and inquiry, we anticipate that there will be changes made to the regulations of renewables in Alberta, but that doesn't mean we will stop working with those who have projects already in the queue or wish to submit an application," Neudorf said in an emailed statement.

"Any changes will take into consideration the needs and concerns of regulators, landowners, municipalities, investors and Albertans."

Lethbridge-East UCP MLA Nathan Neudorf is Alberta's Minister of Affordability and Utilities. (Nathan Neudorf/Facebook)

Neudorf added there were "a large number of submissions" for renewable projects after the moratorium was announced, which "shows the incredible interest we have in getting this right."

"We want to work with those who want to invest here," the minister said. "Alberta has the most renewable-investor friendly system in Canada, but we also must ensure the projects will meet the needs and concerns of Albertans going forward."