Rachel Notley’s Renewable Electricity Act put in place the regulatory framework that ignited a ten-fold increase in the cost of delivered electricity in Alberta — something we are now burdened with. Albertan power bills have been a common point of political debate in 2022 and with the UCP’s second round of rebates so far this year, let's just ask: Why have our power bills exploded since the NDP established the mandate for 30% wind and solar electricity by 2030?.The Alberta Electric System Operator’s (AESO) website has recently published an assessment of the cost of delivered electricity in Alberta from 2009 to 2019. Shown here is the 10-year performance chart for residential service rates of Alberta’s four largest electricity distributors. ENMAX and EPCOR largely service urban areas, while ATCO and Fortis share the rural markets.. Transmission costs .Notice that in the bar chart, the delivered cost break down includes transmission, distribution, energy consumption, administration and local access fees. The color shows that between 2009 and 2019, the largest growth in residential rates is associated with transmission and distribution..Transmission infrastructure is the classical large metal towers used for carrying electricity across long distances..Distribution infrastructure is smaller in scale, is community-based and ends at the individual metered consumer. As with pipelines, investment is recouped through tolls per unit of energy transmitted (i.e., $/MWh)..The AESO table shows an astounding annualized growth rate in transmission fees; with the industrial markets being hit the hardest..Examining AESO’s interactive map of transmission infrastructure in Alberta reveals that the highest density of 144 kV and 240 kV transmission lines in the province lies south of the Trans-Canada Highway and between Fort Macleod and Medicine Hat. This region is where Alberta’s greatest wind and solar resource lies and thus the need for extensive transmission infrastructure within this region..Since Rachel Notley’s Renewable Electricity Act that mandated 30% “renewable” electricity by 2030, Alberta has seen more than $14 billion in wind and solar capacity added and $7.5 billion in new transmission infrastructure built. Electricity market experts have since spoken out and claimed Alberta has overbuilt its transmission infrastructure and that many portions are operating on average, at only 30% of their rated capacity. Interestingly enough, 30% is the average power capacity produced by wind turbines in Southern Alberta..This over capacity has resulted in massive rate increases for consumers..For many portions of our grid that transmits intermittent wind and solar production, it is currently impossible to operate them close to their design limits given the huge swings in power flow associated with the 4,750 MW of weather dependent power generation that are connected to them..This poses a serious grid stability issue and limits other consumers from connecting to the grid and becoming ratepayers..The UCP put an end to the transmission infrastructure expansion, and in 2020-21 only $100 million was invested to expand the system. Additionally, Bill 22 was passed in 2022, which recognizes long duration electricity storage facilities (LDES) as a necessary part of a grid that contains high levels of intermittent weather dependent power generation..LDES units will operate in conjunction with weather forecasting models to extract excess power when solar and wind generators are expected to suddenly ramp up. As wind power tends to peak on a daily basis at night when demand is low, LDES facilities can store and subsequently discharge to the grid later in the day when demand peaks as people come home from work..Currently there is only 70 MW of lithium ion battery storage connected to the grid. Large utility scale lithium energy storage facilities are very expensive, wait times are over 18 months and the manufacturing capacity required to balance our grid simply doesn’t exist..While there are many LDES start-up companies competing to address this rapidly growing grid stability issue, their technologies are new and it will take another 5 to 10 years before we see large-scale rollout of low cost LDES technology..While I am bullish on LDES technologies here in Alberta, I am honest enough to acknowledge that Rachel Notley’s 30% mandate has replaced a few large full-time thermal coal power plants with a multitude of part-time weather dependent systems spread across the province..Part-time energy systems result in a proportionately higher intensity of non-renewable materials and land used per unit of energy produced. Likewise, the energy returned back to society relative to the energy invested in the manufacturing and construction of these weather dependent systems is on the lowest end of the scale compared to conventional technologies like coal and nuclear..How is this green?.Historically, most of Alberta’s thermal coal power plants were located in central Alberta where the demand was concentrated and thus didn’t require a massive transmission system or highly distributed LDES facilities..Rachel Notley continues to double down on her parties’ 2023 campaign promise, to further remake Alberta’s energy industry by doing more of what we have already seen is remarkably naïve and massively inflationary..My next and last article of 2022 will outline my opinions on how Alberta should move forward on this file.
