February 21st, 2024

City commits $7M toward clean energy

By COLLIN GALLANT on April 5, 2023.

Mayor Linnsie Clark listens to debate at city council's Feb. 21 meeting. The city is putting $7 million toward clean energy and could be used in a number of ways.--News Photo Collin Gallant

cgallant@medicinehatnews.com@CollinGallant

City council has earmarked $7 million to pursue “an early phase clean energy project” one week after staff and elected officials expressed strong interest in renewable energy production.

The money from the working capital in the energy division could be put into a number of avenues, according to an outline provided with the item added to Monday’s council meeting agenda.

City councillors and officials declined further comment citing commercial sensitivities, but Mayor Linnsie Clark said the city’s energy unit is developing a plan to lower emissions that will eventually require spending.

“We’re hoping that as our energy transition strategy comes forward, those kinds of solutions are proposed,” she told the News. “We will need to look at options that will allow us to be flexible and bold.”

Coun. Andy McGrogan spoke to the funding request, calling it a large amount, but also a “cost of being in business” to protect the power business that recorded $300 million in sales in 2022.

Earlier in the evening, council approved $3.24 million in maintenance for a generating unit at the river valley station after administrators said wear on the rotor presented a safety concern and the unit could be in service for “several more decades.”

At that time, councillors heard the energy division is now using the term “energy expansion” rather than “energy transition,” as the former suggests a range of energy production methods will be used to meet growing demand in general as well as a drive to lower carbon dioxide output.

Administrators says the city’s fossil fuel-based infrastructure will be useful as a main power source or on-demand backup for renewable power that produces in relation to weather. That would “mitigate” higher emissions without wholesale change from fossil fuels to renewable generation.

A provided outline of the strategy states the city could take part in partnerships or limited pilot projects, will stage costs and look to scale initially small investments over time, but the city will concentrate on “proven methods,” though they admit technology is rapidly advancing. The goal is to provide low-carbon energy at comparable or lower cost than elsewhere in the province.

“The city is looking at all potential options to transition energy delivery, and is considering carbon capture, renewable generation, alternative fuels (including hydrogen and renewable natural gas) as well as other potentially viable solutions,” it reads.

The statement comes after last week’s federal budget program which would provide 15 per cent of capital costs for bringing green energy projects or battery storage systems online for cities and 30 per cent for private-sector developers.

Federal grants are also available for carbon capture and sequestrations, for both upgrades at emission sites, like the city’s gas-fired power plant, and to develop eventual underground storage facilities.

The city estimates that carbon-capture facility initiative, known as Clear Horizon, could be online in 2030, if approved.

Officials are also studying the potential to blend hydrogen into natural gas used in the city’s steam turbines.

Local utility officials have also said they are exploring the use of strategically placed battery storage systems to aid grid reliability without more expensive line or substation upgrades.

Last year the city paid about $5 million in carbon compliance fees through the Alberta government’s TIER program that taxes heavy emitters, but companies and cities can earn the same amount per tonne in program credits through green power production or composting.

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