Supporters of renewable energy projects on farmland must “demonstrate the ability of both crops and livestock to coexist on the land,” Alberta’s public works minister says.
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Alberta will take an “agriculture first” approach when determining where new renewable energy projects can be built in the province, while creating a 35-kilometre buffer zone around “pristine landscapes.” , requiring developers to pay a repair bond.
To industry supporters, this news feels more like a second-tier renewable energy policy. The industry is seeking more answers about the new rules’ potential impact on investments in the nation’s hottest renewable energy market.
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The province will lift its moratorium on approvals of new renewable energy projects later this week, and the Alberta Public Utilities Commission (AUC) will overhaul the criteria for approving future clean energy proposals.
The new policy was announced on Wednesday by Prime Minister Daniel Smith and Minister for Prices and Public Works Nathan Neudorf, who said the rules aim to protect farmland while enabling the growth of the renewable energy industry. Neudorf acknowledged that the policy is likely to slow the rapid expansion of the renewable energy sector.
“We are simply asking proponents to demonstrate the ability for both crops and livestock to coexist on the land for renewable energy projects. We are creating a path,” he said in an interview.
“We expect some of these (proposed) investment projects to be scaled back.”
The UCP government will instruct the AUC to use the new policy direction to approve new projects from March 1.
The changes are not retrospective, but apply to the 13 projects that began the review process during the seven-month hiatus that began in August.
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Reactions from clean energy advocates and developers centered on the lack of specific details on key policies, such as how the state would define pristine landscapes.
“We still need more information,” said Vittoria Bellissimo, CEO of the Canadian Renewable Energy Association.
“In this case, any uncertainty is bad uncertainty.”
Blue Earth Renewables CEO Grant Arnold said he was pleased the changes would not apply retroactively to projects already built in the state.
But the Calgary-based company also plans to develop about 400 MW of wind and solar power in Alberta.
“Combining the concepts discussed in the state today adds cost and red tape,” Arnold said.
“I’m not going to greenlight a new project in Alberta today until I have some confidence. I don’t know if it’s going to happen in the near future or in the distant future.”
Alberta has seen a surge in wind and solar power projects over the past five years.
The state will add about 1.4 gigawatts (GW) of installed renewable energy in 2022, about three-quarters of the nation’s additional capacity, a share that rose to more than 90% last year.
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This change means that proponents will be unable to raise livestock or crops in areas that the state considers Type 1 and Type 2 agricultural land under the Land Suitability Assessment System (covering approximately 7 million hectares out of 26 million hectares). Renewable projects will no longer be allowed unless they can show they can coexist. Neudorf said:
The state will also work to create tools to ensure that natural grasslands, irrigable land, and productive farmland remain available for agriculture.
“We are trying to be responsible not just for one industry, but for many industries,” the minister said.
At least 35 kilometers of buffer zones will be created around protected areas and areas designated by the state as wild landscapes, such as the Rocky Mountains and foothills.
In these areas, wind farms with turbines would be “off limits,” Neudorf said. Other developments within this zone may require AUC to conduct a visual impact assessment.
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The minister doesn’t expect many projects to be affected, but the Pembina Institute said the buffer zone could cover up to 76 per cent of southern Alberta because of the protected area. He said it seems like it.
“If the government is interested in putting agriculture first, then these rules should apply to the oil and gas sector, housing development and industrial development,” said Simon Dyer of the Pembina Institute.
The province says the reserves, which will be concentrated in western Alberta, have not yet been established.
The new policy would also create guidelines for how much land reclamation would pay for cleanup when a renewable project reaches the end of its useful life, including issuing bonds to cover the cost.
This money will either go to the AUC or be negotiated with landowners, but the exact amount needed has not yet been determined.
The upcoming changes will give local governments the right to automatically participate in AUC public hearings on new projects. Other parts of the government’s wide-ranging review of the power sector are also being developed and are expected to be unveiled in late March.
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Controversy over Alberta’s renewable energy policy shows no signs of letting up.
The new policy is likely to continue to stir up controversy over Alberta’s moratorium adopted last summer as more proposals are submitted to the AUC.
Alberta has excellent wind and solar resources and is Canada’s only liberalized electricity market, attracting private sector investment. The energy-only market allows developers to build projects and sell electricity to corporate customers along with renewable energy credits through power purchase agreements.
Business Renewable Center Canada said business-based PPAs have attracted more than $6.4 billion in investment since 2019.
Dan Balaban, CEO of Greengate Power, which developed the country’s largest solar power project south of Calgary, said Wednesday there is still uncertainty about how the new rules will be applied. He said that there is a subjective part.
His company, which has been involved in renewable energy development in Alberta for more than a decade, has seen the province become Canada’s largest investment destination in wind and solar power, one of the largest investment destinations in oil country. It’s a modern-day miracle to see that happen.”
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“I’m a little disappointed because it looks like that pace of growth is not going to continue,” Balaban added.
“Certainly they seem to be prioritizing agriculture over renewable energy. Agriculture first would imply that… I think both can coexist.”
But Paul McLaughlin, president of Alberta Municipalities, said the review addressed issues that needed deeper consideration due to the industry’s rapid expansion.
“It’s actually not that restrictive,” he said.
“Most rural Albertans should be happy with the way things are going.”
Chris Varcoe is a columnist for the Calgary Herald.
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