Expand Renewable Energy
Open the doors to a growing business and invest in your municipality’s energy security by welcoming solar electricity generation.
Table of Contents
The Rationale
In 2021, electricity generation in Alberta contributed to about 9% of emissions. For several years, thanks to its deregulated, wholesale electricity market, historically little government regulation, and excellent wind and solar resources, Alberta has been Canada’s leader in building the transition to new energy sources. In 2023, Alberta accounted for over 92% of Canada’s overall growth in renewable energy and energy storage capacity and attracted renewable energy investments from major companies such as Amazon and Microsoft. This has created billions of dollars of investments in Alberta, and, to date, an estimated 25,000 jobs in a rapidly growing industry.
These projects have created direct financial benefits for Alberta’s municipalities. In 2023, $28 million in tax revenue was generated by Albertan municipalities. Some municipalities received as much as 50% of their tax revenue from renewable energy projects and at least eight municipal districts each received over $1 million as of end of 2023. Thanks to this energy leadership story, Alberta’s grid electricity emissions intensity has reduced by about 50% from 2005 levels, leading to a reduction of 20 million tonnes of greenhouse gas (GHG) emissions each year.
Source: Business Renewables Centre.
Public support for renewable energy in Alberta remains robust, reflecting a growing awareness of the importance of transitioning to renewable energy sources. According to polling by the Business Renewables Centre in September 2023, 75% of Albertans agreed that they would like to see more renewable energy projects developed in the community that they live in, and 70% agreed that the Government of Alberta should be doing more to encourage future development of emissions-free energy, such as wind and solar power, in the province.
In addition to emissions reductions, local renewable energy projects can build numerous local co-benefits including community resilience by supplementing onsite power use, mitigating price spikes during peak loads, improving local air quality, and local economic stimulus. The tangible benefits of renewable energy generation, especially job creation and annual cost savings (see case studies) are valuable success stories to share with residents.
Vision: What does success look like?
Alberta’s municipalities continue the leadership that is already underway with high adoption and development of renewable energy so that all communities are powered by reliable and affordable zero emissions energy.
Solar, wind, and other renewable/alternative energy projects are integrated into the energy grid, and affordable and accessible renewable/alternative energy options are available to all residents. The evolution of Alberta’s grid incorporates and grows the skills and expertise of the existing workforce so there are new opportunities for everyone to benefit from, and contribute to, a resilient future.
The Reality
Who is responsible?
Achieving net zero electricity requires coordinated and collaborative efforts amongst all levels of government and the private sector.
Federal and Provincial governments share responsibility for environmental protection and emissions reductions. Provinces and Territories hold jurisdiction over electricity planning and operations and the Federal government holds jurisdiction over interprovincial transmission projects, and international commitments, amongst others.
Within this context, municipal governments have the power to shape the renewable energy landscape within their jurisdictions and have a number of levers to do so including land use planning, community engagement, direct investment, zoning bylaws, etc. Municipalities can develop their own renewable energy targets and strategies and align them with provincial and federal objectives; understand the renewable energy generation potential in their communities; educate business and community members; and collaborate with higher levels of government, regional organizations, and neighbouring communities.
Within their own operations, municipalities can procure renewable energy for their own operations. This can drive and stimulate economic development, reduce energy costs, and lower emissions.
Federal Legislation, Programs, and Funding
The Government of Canada is developing the Clean Electricity Regulations (CER) to support the demand for electricity and lay out the rules for getting Canada’s electricity grid to net zero emissions by 2035. The CER are being developed using three core principles:
- Enable significant greenhouse gas reductions to help transition towards a net zero electricity grid;
- Enable provinces and territories to maintain electricity affordability for Canadians and businesses; and
- Enable provinces and territories to maintain grid reliability as Canada’s electricity needs grow.
In 2023, the Alberta Government invoked the Sovereignty Act to push back on the CER. Learn more about the Government of Canada’s broader electrification strategy.
Provincial Legislation, Programs, and Funding
In 2015, the Alberta Government announced the elimination of emissions from coal power generation by 2030. Since then, power generators in Alberta (including Capital Power, Heartland Generation, and TransAlta) have advanced plans for coal-to-gas conversions, and all coal-fired facilities are expected to phase out by 2024, seven years ahead of schedule.
Alberta has a quickly changing legislative landscape when it comes to renewable energy. The 2020 Renewable Electricity Act was enacted to promote the development and utilization of renewable electricity and sets a clear target: by the end of 2030, at least 30% of the electric energy produced in Alberta will be derived from renewable sources.
Under the Electric Utilities Act, Micro-generation Regulation, Albertans are allowed to meet their own electricity needs by generating electricity from renewable or alternative energy sources and sell the surplus to the Alberta grid in exchange for energy credits, with a maximum limit of 5 MW of installed capacity. To date, Alberta’s microgeneration capacity totals 238 MW across more than 19,294 sites.
In August 2023, the Alberta Government imposed a temporary halt on approvals for large renewable energy projects in response to concerns about the rapid proliferation of projects in the province. In 2024, Premier Danielle Smith and Minister of Affordability and Utilities Nathan Neudorf announced several changes to policy, legislation, and regulations for renewable energy power plants and projects, including:
- Adopting an ‘Agriculture First’ approach that will require the Alberta Utility Commission (AUC) to prioritize agricultural uses when evaluating renewable projects proposed on Class 1 and 2 lands, as classified by the Alberta Land Suitability Rating System.
- Requiring proponents of renewable energy projects approved on or after March 1, 2024, to cover their project’s end-of-life reclamation costs.
- Establishing ‘buffer zones’ extending at least 35 kilometres around protected areas and ‘pristine viewscapes’ designated by the province.
- Directing the AUC to grant municipalities automatic participation rights in AUC hearings, eligibility for cost recovery, and the ability to review AUC rules on submission requirements.
The implications of the moratorium and new policy on businesses and municipalities are unclear. The Pembina Institute’s initial estimates state that the pause is affecting 118 projects worth $33 billion in investment. These same projects could provide $277 million in total tax revenues to municipalities from currently planned solar and wind project by 2028.
Based on the Alberta Electric System Operators (AESO’s) February 2024 Long Term Adequacy report, Alberta has 3,300 megawatts (MW) of wind and solar projects under construction, 2,760 MW with AUC approvals, and approximately 22,900 MW of additional wind and solar project announced.
The State of the Industry
There has been explosive growth in renewable energy as well as technical and economic advances worldwide over the last several years. Between 2010-2022 the cost of solar photovoltaics, wind energy, heat pumps, and batteries for storage reductions decreased by 80%. In 2023, $623 billion was invested globally in renewable energy, plus $36 billion in energy storage and $10.4 billion in hydrogen.
Globally, there was more money invested in solar than in oil in 2023.
For many years now, more renewable energy has been installed than for fossil fuels worldwide. It is estimated that 444 GW of solar PV and 107 GW of wind energy were installed in 2023 – far more than was installed for fossil fuel power generation. Of the 551 GW installed globally, just over 2 GW of this was installed in Alberta (0.4%) At the end of 2022, Alberta had 18.3 GW of installed electricity generating capacity of all types, including natural gas, coal, and renewables.
In 2022 about 83% of all new capacity worldwide was renewable – mostly solar and wind which make up the fastest growing sources of electricity in history, and they are continuing to accelerate. For its Net Zero Energy Scenario, the International Energy Agency (IEA) estimates that over 10,000 GW of renewables will be needed by 2030, and about 30,000 GW by 2050.
The IEA estimates that globally 96% of newly installed, utility-scale solar PV and onshore wind capacity had lower generation costs than new coal and natural gas plants. Even more astoundingly, the IEA also now estimates that 75% of new wind and solar PV plants installed globally offered cheaper power than existing fossil fuel facilities.
Intermittency for many forms of renewable energy is a challenge and will become an increasing challenge as the percentage of renewables on a grid increases. Solutions, which are at varying degrees of maturity, include flexibility in other power generating technologies, interties with other jurisdictions that have flexible forms of energy (e.g. hydro), demand response, flexible pricing mechanisms, pumped storage, battery storage, and hydrogen.
As of 2022, Alberta had a 14.1% provincial supply mix for electricity generation from renewables totals (12.2% wind and 1.9% solar), which is slightly above the global 2022 average of 12%.
The Response
The City of Medicine Hat is an exception to a number of the recommendations below. It has its own electricity grid which existed prior to the Electric Utilities Act and has special consideration under that. This is important to keep in mind for using the Climate Action Explorer Tool.
REFERENCE
The Local Actions
The following local actions have been identified in response to the information above, as well as best practice research, current available data related to waste in Alberta, and criteria such as how the actions reduce emissions and risk, support equity, their feasibility, and cost. These local actions may be designed and/or implemented on their own, or in combination with other community strategies and programs and are recommended for local governments to more toward low carbon resilience as efficiently as possible.
Local Actions Reference
Expand for descriptions of the four types of interventionsEmpower
Providing educational programs, training, grants, and resources that enable community-driven initiatives to empower local residents, community organizations, and businesses to take an active role in climate mitigation and adaptation efforts. Empowering local stakeholders fosters a sense of ownership and responsibility for climate action, ensuring that solutions are tailored to the unique needs and characteristics of each community. Empower also includes the education of staff and industry.
Incentivize
Implementing a range of financial and non-financial incentives to motivate individuals, businesses, and institutions to adopt climate friendly practices. This may include tax breaks, subsidies, and recognition for businesses implementing sustainable practices.
Require
Establishing regulations and bylaws to mandate or compel adherence to climate-conscious practices. Clear requirements help create a legal framework for a baseline level of environmental responsibility.
Partner
Forging partnerships with local businesses, academic institutions, non-profit organizations, neighbouring municipalities, and community organizations helps local governments leverage collective expertise, resources, and builds influence and buy-in for comprehensive climate action.
Local Action #1: Support renewable energy infrastructure planning, policy, and development
Establish Renewable Energy Task Forces: Create task forces or working groups specifically focused on the renewable energy transition, including experts, community leaders, regional partners, and Council members.
Technical Assistance Programs: Engage organizations or agencies that offer technical assistance for municipalities; these can provide guidance in finding funding or implementing renewable energy projects.
Education and Capacity Building: Enable residents to produce their own power. This could include demonstration projects, information portals, online maps, publications, marketing, workshops, workforce training and more. When developing policies, programs, or plans related to renewable energy, involve the community through public consultations and engagement events to build public support and awareness.
Permitting Measures: Optimise municipal permitting processes, adjust bylaws, and conduct other planning and policy measures to encourage renewable energy development. This can include simplifying and reducing the costs of the permitting process, providing clear guidance on project details like setbacks and height restrictions, and expediting inspections.
- Three types of municipal permits are relevant for solar PV project development and installation for systems installed under the Alberta Microgeneration Regulation – development, building, and electrical permits. Best practices in Alberta are summarized in the checklist below. For further details, please refer to the Solar Friendly Municipalities Toolkit from the Municipal Climate Change Action Centre.
Rebates: While the cost for residential or commercial solar PV systems has dramatically decreased in recent years, projects continue to have long payback periods. Access to capital cost rebate funding programs improves the economics of installations and creates a significant increase in local decentralized clean energy. Providing rebates can reduce local GHGs, increase energy generation, create jobs, and provide opportunities for outreach and education.
Clean Energy Improvement Program (CEIP): Launch CEIP financing to enable property owners to improve a building’s energy performance by installing energy efficiency and renewable energy upgrades. CEIPs provide access to competitive financing that covers up to 100% of the upfront costs of upgrades. The loan is repaid through the owner’s property tax bill. Many municipalities across Alberta have passed bylaws and launched programs. Existing program locations can be seen here.
- CEIP is voluntary for municipalities. To set up a CEIP, a municipality must first pass a CEIP Bylaw.
Renewable Energy Plans: A community can, if it chooses to, begin by developing a plan or a completing scan. A renewable energy plan could be a sub-set of a climate action plan for a community. Planning typically starts by understanding your community’s current energy needs and identifying opportunities. Renewable energy opportunities differ by community and there are also differences in terms of local businesses, expertise, stakeholders, and interests.
Solar Access Principles and Land Use Planning: Solar access refers to the legal assurance that a property owner has access to sunlight and is critical for planning and investing as changes in land use, development, and ultimately access can render a solar PV system worthless. Municipalities may exercise significant influence on solar development through proper planning and accounting for rights to solar access.
- Municipalities can incorporate solar access principles into land use planning, for instance through limited restrictions at the local level to prevent or discourage solar PV installations.
- Municipalities may facilitate “solar easements,” which are agreements between adjacent property owners for the right to sunlight contingent on conditions mutually agreed-upon by property owners. Developers can restrict the type of building and choice of vegetation, as well as subdivision plans, to promote or allow solar access.
On-Site Renewable Energy on Civic Buildings and Property: Alberta’s micro-generation regulation makes it easy to install renewable energy systems for on-site consumption and allows for projects up to 5 MW in size. The renewable energy system must be on or adjacent to a structure of land owned by the municipality. Alberta’s “net-billing” system credits micro-generation customers for any excess electricity exported to the grid.
- Many municipalities in Alberta have installed solar PV through the micro-generation regulation. Micro-generation works best with solar PV due to the scale and ease of installation but could also work with wind turbines and potentially other technologies as well. Micro-generators must prove that they have GHG emissions below 418 kg/MWh, or lower GHGs than a typical combined cycle natural gas turbine plant.
- Celebrate the benefits of locally-generated energy by publishing annual cost savings.
Small Scale Energy Generation: Through Alberta’s Small Scale Generation Regulation, municipalities can install generating units located on a municipally controlled structure or land. They must generate an equivalent amount of electricity that is consumed by the municipality’s operations within its boundaries in each settlement period – i.e., each hour. This can be a limiting factor with respect to intermittent renewable energy systems unless a municipality also installs energy storage such as batteries. The municipality must also file for approval to the Market Surveillance Administrator.
Community Energy Generation: Alberta’s Small Scale Generation Regulation also sets the groundwork for community generation, defining eligible projects as those that produce renewable energy to generate electricity for sale to the grid while conferring social, environmental, and economic benefits to communities through a community benefits statement or agreement.
Green Energy Procurement: Green energy procurement refers to the process by which organizations, municipalities, or individuals secure renewable energy to meet their electricity needs. Albertan municipalities can sign Power Purchase Agreements (PPAs) to obtain renewable power for their operations. Organizations opting for this approach can reduce their emissions and demonstrate corporate responsibility. A PPA is a legally binding contract between an electricity generator and a buyer that defines terms for the sale and purchase of electricity over a specified period.
- PPAs provide a stable, long-term source of renewable energy at a fixed or predictable price, helping buyers manage energy costs and hedge against price fluctuations. They support the development of renewable energy projects by offering developers a guaranteed revenue stream, making it easier to secure financing. Business Renewables Canada has helpful resources for communities that are interested.
Pilot and Demonstration Projects: Collaborate with local groups, organizations, or businesses on initiatives or events that invite people to see/tour a local renewable energy project at work. Demonstration projects allow the construction industry to show their skills, build capacity in their teams, and prove the feasibility of renewable energy technologies.
Experts and Consultants: Hire renewable energy experts or consultants to provide guidance and develop frameworks and actionable plans for specific municipal projects and policies.
Research Institutions: Explore opportunities for joint projects or collaborative initiatives that can benefit both the community and research institution. In addition, identify existing programs that are offered by post-secondary institutions in the renewable energy field and raise awareness among residents to support future capacity and technological expertise.
Large-Scale Renewable Energy through Land Use: Municipalities often have access to land – a crucial resource for utility-scale wind, solar, and other clean energy projects. Municipalities can consider leasing municipal land to a large developer to support renewable energy development while creating a valuable new source of tax revenue.
District Energy System: Aggregate heating through a district energy system to distribute thermal energy from a central source out to multiple buildings in an area or neighbourhood. Municipalities may use direct energy for heating and/or cooling. Through economics of scale, district energy systems allow for large emissions reduction at a lower cost than individual building systems. Emissions-free heat can be sourced from a wide variety of low carbon sources that may include waste heat recovery, geo-exchange, bio-energy, deep geothermal energy, fossil fuel combustion, or waste-to-energy technologies coupled with carbon capture and storage. Emission-free cooling will likely need clean electricity or geo-exchange. District energy facilities are typically designed with redundant generating capacity, utilizing more than one fuel source. This dual-fuel (or multi-fuel) capability can provide greater resilience in the face of disruptions to the electrical grid or natural gas supply. District energy systems are most effective in dense areas, where the loads for heating and cooling are located nearby.
Renewable Energy Transition Roadmap
The Renewable Energy Transition Roadmap is a long-term technical blueprint that provides pathways to achieving Banff’s goals of 30% emissions reductions by 2030, 80% by 2050 (of 2016 emissions levels), and achieving 100% renewable energy by 2050. Actions in the plan are grouped into four broad categories: energy-efficient buildings, local low-carbon energy, importing renewable energy, and low-carbon transportation. The Roadmap describes these actions, summarizes the modelling results, and provides recommendations for implementation.
Updated Land Use Bylaw for Expedited Renewable Energy Applications
In Nov. 2023, the Town of Coalhurst updated its Land Use Bylaw on the review and permitting of renewable energy systems. Solar energy systems were previously considered a discretionary use and required notification to adjacent landowners on the applications. Roof or wall-mounted solar energy systems are now permitted for use in several zonings including residential, commercial, and parks and recreation. In addition, the uses of “Solar energy system, individual – roof or wall-mounted,” “Solar energy system, individual – ground-mounted” and “Wind energy conversion system, individual” are added as discretionary uses in several zonings.
Solar Incentive Program
The Town of Canmore offers an annual solar incentive rebate program for residents and businesses to help offset the cost of purchasing and installing a rooftop solar photovoltaic system in Canmore. The incentive is $1,250, regardless of the size of the system.
Land Use Bylaw for Solar Access
The Town of Millet has attempted to restore the right to light through their municipal bylaws. The Town’s Land Use Bylaw 8.8(4) states that no “development permit shall be issued for the construction or enlargement of any structure which would significantly reduce the amount of sunlight falling on any solar radiation collector system which is complete or under construction at the time of application for that development permit.” This bylaw effectively guarantees access to solar energy for those individuals who choose to install a solar collector on their property.
First electrically-net zero municipality in Canada
The Town of Raymond is a municipal leader in Alberta’s energy transition – it the first electrically net zero municipality in Alberta (another first, it is also home to Canada’s first rodeo!). In 2018, Raymond decided to install nine solar PV arrays on municipal facilities and land, accessing $643,481 in funding from the Municipal Climate Change Action Centre (MCCAC). Before rebates, the system cost was $2,781,923. The 2,983 modules installed have a total capacity of 1.16 Megawatts and are expected to produce 1,302 MWh of electricity per year. This will offset 100% of Raymond’s operations’ annual electricity use and provide an estimated annual savings of $130,186.
RenuWell Project
The Municipal District of Taber is repurposing legacy oil and gas infrastructure into solar power. Two MW of distributed solar generation is being installed on abandoned oil and gas lease sites located in Taber. In Alberta, there are more than 200,000 inactive and abandoned wells, which affect more than 1,600 square kilometres of disturbed and potentially contaminated land. Projects like RenuWell aim to showcase:
- Economic opportunities for landowners stranded with orphaned wells on their farms
- Opportunities to conserve farmland by using brownfield sites for solar energy projects
- Innovative options to reduce reclamation costs for oil and gas companies by eliminating the need to remove the roads and powerlines
- Avenues for revenue generation for partnering organizations and municipalities.
Some of the project’s many goals include:
- Successful development of a distributed solar generation network
- Training for oil and gas workers via Medicine Hat College to help diversify the local economy
- Creation of new revenue generation opportunities for the municipal district.
This project is funded in part by the Municipal Climate Change Action Centre’s Municipal Community Generation Program.
Green Energy Procurement
In 2022, the City of Edmonton made history by becoming the first municipal buyer in Alberta to secure a virtual PPA for new renewable energy. The City signed two contracts for renewable energy that will cover an equivalent of 100% of its electricity consumption for its operations, over 20 years. The largest contract is with Ontario-based Capstone Infrastructure Corporation for 270,000 MWh from the 192 MW Wild Rose 2 Wind Farm, in Cypress County. The smaller contract is with Calgary-based BluEarth Renewables for 70,000 MWh of solar, from the 50 MW Wheatcrest Solar Project located in the Municipal District of Taber. The City estimates that these contracts will reduce GHG emissions by 95,000 tCO2e per year. These projects will help the City meet targets set out in its corporate Greenhouse Gas Management Plan. The success in achieving this milestone was attributed to the City’s substantial electricity load, facilitating collaboration with developers, and the financial resources and scale that justified the involvement of expert consultants.
Photo from Wheatcrest solar facility, located west of Medicine Hat. This facility will start producing approximately 70,000 MWh of solar power offsets next year for the City of Edmonton through the renewable energy contracts.
Tax Revenue from Tavers Solar
Alberta’s largest solar farm is the 465 MW Travers Solar Project in Vulcan County which produces enough electricity to power the equivalent of more than 150,000 homes. The recent surge in renewable development in the area is making up for lost revenues caused by abandoned fossil fuel assets, with municipal taxes from solar and wind now making up 45% of the County’s revenue.
Community Energy System
Strathcona County’s system uses hot water heated by boilers. The system can be powered by natural gas or use biomass (wood waste and agricultural residues) to heat the system. The water is delivered through underground, insulated pipes to heat individual buildings including County Hall, Festival Place, Kinsmen Leisure Centre, Sherwood Park Arena and Sports Centre and its recreation office and Residential condo buildings in Centre in the Park. The system reduces GHGs by 18% each year in comparison to conventional heating systems.
Helpful Resources
- Creating a Roadmap for Your City’s Renewable Energy Transition, C40 Knowledge Hub
- Solar Friendly Municipalities Toolkit, Municipal Climate Change Action Centre
- Alberta Solar Calculator, Municipal Climate Change Action Centre and Lakeland College
- Enabling Community Renewable Energy Development Through Aggregation, Municipal Climate Change Action Centre and The Pembina Institute