Sunny skies for large-scale solar projects in Alberta

The province’s solar power capacity is showing signs of growth, especially when it comes to utility-scale projects.
 
Evan Wilson, a senior director at the newly formed Canadian Renewable Energy Association, credits a combination of falling prices, ample resources and new UCP policies for a projected explosion of large-scale solar projects in Alberta.
 
“It’s a very exciting time for our sector,” Wilson said.
 
In 2018, less than 0.1 per cent of Alberta’s electricity was generated by solar, according to the Canada Energy Regulator, compared to 43 per cent generated by coal and 49 per cent by natural gas.  
 
But that balance is shifting. 
 
In July alone, seven potential projects worth $634 million were announced in Alberta, some as large as the province’s entire current solar-generating capacity. 
 
By Wilson’s count, the Alberta Electrical Systems Operator has about 8,000 megawatts worth of projects in the application queue. While not all will be approved, he said it speaks to competitiveness in the sector.
 
He said the surge is in part due to the UCP’s TIER program, which came into effect January 1.
 
A major driver for solar producers is not only selling electricity — either to the general market or to a specific customer — but selling carbon offset credits to large industrial emitters. Under the TIER program, heavy carbon emitters get a break on their carbon tax by purchasing offset credits from renewable companies.
 
“That’s another revenue stream solar projects can generate or use, which makes Alberta a very attractive place to build these projects,” Wilson explained.
 
Last month, the Royal Bank of Canada became the first financial institution in the country to enter into a long-term power purchasing agreement with a renewable energy company. RBC inked a deal with Bullfrog Energy to develop a 39-megawatt solar project in the County of Forty Mile, which will be built by BluEarth Renewables. The two-site project — Burdett and Yellow Lake — is expected to be up and running by April 2021.
 
An incoming $169-million development west of the Edmonton International Airport in Leduc will generate 120 megawatts annually when it comes online in 2022. Currently, the province’s largest operational solar project, located outside Brookes, generates 17 megawatts. 
 
The previous NDP government was making progress on the renewable energy shift. Three rounds of funding were allocated via the Renewable Electricity Program, mostly for wind turbine facilities, before the program was discontinued by the UCP. 
 
Regulatory policies, cheaper tech and sunshine favour development
Unlike other provinces where electricity regimes are owned and operated by Crown corporations, Alberta’s regulatory system works in favour of market-driven power developments. 
 
“Alberta is the only place in Canada where, if you decide to build a power plant, you can build a power plant and connect it to the grid,” Wilson said.
 
Wilson also lauded Energy Minister Sonya Savage’s move late last year to reverse course on an NDP decision that would have changed Alberta’s system from an energy-only market to a capacity system.
 
Prices for the technology required by large-scale operators have dropped by 90 per cent over the past decade, according to international asset management firm Lazard. Bloomberg New Energy Finance forecasts those prices will drop another 34 per cent by 2030 and 63 per cent by 2050.
 
Alberta has ample sunlight for large-scale solar power plants, with southern regions of the province getting upwards of 2,500 hours of sunshine annually.
 
However, Benjamin Thibault, executive director of Solar Alberta, said projects are still running into problems when it comes to accessing financing.  

“You need to have access to the upfront capital dollars,” he told AB Today in an interview. “It’s important to recognize this is a sector that can go from a stimulus program to job creation very quickly.”