City taking no position on province’s renewables pause
By COLLIN GALLANT on August 18, 2023.
cgallant@medicinehatnews.com@CollinGallant The province’s only municipally operated power company will not take a position on a six-month halt on new green energy projects, despite a call from the Alberta New Democrats for cities to petition on behalf of rate payers. Premier Danielle Smith’s government instituted the moratorium on new wind and solar approvals until late February so the environmental, agricultural and pricing effects could be studied. On Wednesday NDP deputy leader Sarah Hoffman called on mayors of Calgary and Edmonton to denounce the move, which the party argues blocks new lower cost generation projects at a time of all-time high power prices. Both cities also own arm’s-length utility providers (Enmax and Epcor) that are entwined with the grid, she said, and more green power would lower costs to customers. The City of Medicine Hat, which generally only sells on to the grid, will stay out of it, according to senior elected officials. “Currently, the City of Medicine Hat is unaffected by this decision as our power generation is natural gas based,” reads a statement attributed to energy committee chair Coun. Alison Van Dyke. “We will be watching with interest as to the outcomes of this pause.” Hoffman told a press conference this week that Smith’s reasoning for the move is “nonsense” and that Edmonton Mayor Amarjeet Sohi and Calgary’s Jyoti Gondek should act in the best interest of their residents and request the moratorium be lifted. “Danielle Smith sabotaged more than a dozen low-cost, low-emission power stations, just as Albertans are facing unprecedented energy prices and an unprecedented wildfire season,” said Hoffman, also her party’s critic for municipal affairs. “Our two major cities are home to a million or more Albertans each, all of whom will be hurt by rising electricity prices. Both cities also own utility companies that will be directly affected.” Smith has stated she wants Utilities and Affordability Minister Nathan Neudorf to lead a look into the default (also known as RRO) pricing, and has implied that distribution fees and intermittent power supply from renewables has driven up price. “We have to live in the real world and we have to make sure that we have enough (firm) power coming on to compensate (for renewables),” Smith said during a press event Monday responding to federal position that more renewables leads to lower price. “Wind and solar driving down the price when generation is high, (Ottawa) right, that’s what they’re good at. But what they’re not good at is providing baseload power.” The City of Medicine Hat generally does not import power to resell to residential consumers, but does bring in limited contracted power for a large industrial contract. It also buys a small amount of power from the wind turbines in the north of the city erected in 2013 by WindRiver Power. The ability to self-supply keeps customers from paying mounting fees to upgrade the provincial power grid, and currently all of that 299-megawatt power capacity is gas-generated. But its general price setting formula places local default rate at the average of default rates across the province. Those are based on cost estimates for power on the open energy-only market, where prices can rise dramatically in times of shortfall. In 2021, the city undertook a “valuation process” to determine the power utility’s worth and the effect of renewable power production on grid prices that make up most of city’s annual profits on electrical sales. That process was shelved shortly thereafter however, due to public backlash, and since, the city’s energy division has stated it will focus on reducing emissions at the power plant through carbon capture or hydrogen blending while determining new, potentially green generation projects. This spring council approved earmarking $7 million for unspecified involvement in a “clean energy opportunity,” but no other details have been released. 20-19
