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Alberta

On Friday, Alberta’s energy minister hailed their largest solar project. On Sunday, it was producing 10.9% at noon

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This was the opening splash for a video clip posted by the Alberta energy minister on social media. Two days later, its power output at noon was barely 11 per cent. YouTube/Canadian Energy Centre

From PipelineOnline.ca

Brian Zinchuk

Brian Zinchuk is editor and owner of Pipeline Online

And wind was doing even worse

Even though Alberta’s build-out of 38 wind farms and 36 solar farms have resulted in an enormous growth of nameplate power generating capacity, the reality was far from the advertised on Sunday, according to data from the Alberta Electric System Operator (AESO).

Despite the noon hour being defined as the sun being at its highest point in the sky, Alberta’s grid-scale solar facilities were having a tough day on Oct. 22. At 11:53 a.m., solar was producing 152 megawatts out of an installed base of 1,292 megawatts. That was 11.8 per cent of capacity. On a good day, that number is closer to 1,000 megawatts around noon.

Power generation in Alberta at 11:53 a.m. on Oct. 22. All numbers are in megawatts, MC is maximum capacity, and TNG is total net to grid. Alberta Electric System Operator

It wasn’t hard to figure out why solar hand tanked. A belt of heavy clouds, visible from Environment and Climate Change Canada satellite imagery, blanketed the principle solar power production region of southern Alberta.

Heavy clouds covered southern Alberta at 11:30 a.m. on Sunday. Environment and Climate Change Canada

Travers, the largest solar facility in Canada with a rated capacity of 465 megawatts and having cost $700 million, was producing 51 megawatts a few minutes before noon. That was 10.9 per cent. Ironically, Alberta Energy Minister Brian Jean had posted on LinkedIn on Oct. 20, “Did you know Alberta is home to Canada’s largest solar farm? Once we set clear rules around land use, reclamation and transmission, we’ll get back to work leading Canada and the world on renewable electricity. I’m proud of our energy workers. Check out this incredible clip 👇”

That 22 second video clip was originally posted by the Canadian Energy Centre, the Alberta government’s “war room,” whose mission is to set the record straight, as it were. “The Canadian Energy Centre’s mandate is to promote Canada as the supplier of choice for the world’s growing demand for responsibly produced energy,” says the Centre’s mandate.

Wind peters out

And wind power production was having an even worse day, with wind power plummeting as the morning turned into afternoon. By that time, wind was generating just 67 megawatts out of an installed based of 3,853 megawatts. That’s just 1.7 per cent of nameplate capacity.

So at that moment, combined wind and solar were producing 219 megawatts out of a nameplate capacity of 5,145, or 4.3 per cent of capacity.

Alberta’s final remaining coal-fired power facility was producing 802 of 820 megawatts of nameplate capacity, or 97.8 per cent. And its power output was 3.7 times the total output of all grid-scale wind and solar across Alberta, from 36 solar farms and 38 wind facilities, composed of hundreds of turbines and costing billions of dollars. As noted above, Travers, alone, cost $700 million and covers 3,330 acres with 1.3 million solar panels.

That last remaining coal plant, the Genesee Power Station, will soon be converted to natural gas, meaning an end to coal-fired power generation in Alberta – a province whose coal reserves run from Edmonton southwest to the BC and US borders.

The wind situation stayed much the same throughout the afternoon, and by 4:18, solar had dropped to 69 megawatts and wind was just 83 megawatts.

Wind generation in Alberta at 11:53 a.m. on Oct. 22. Twenty-four of 38 wind farms were producing exactly zero power at that moment. All numbers are in megawatts, MC is maximum capacity, and TNG is total net to grid. Alberta Electric System Operator

And near the supper hour, X bot account @ReliableAB noted AESO data showing wind was producing 86 megawatts and solar was producing 28 megawatts. At that moment, fossil fuels, principally natural gas, accounted 94.3 per cent of Alberta’s electricity. Alberta was getting 345 megawatts of power from imports, and batteries were contributing zero megawatts.

That 94.3 per cent is significant, because the federal government’s clean electricity regulations will require “unabated” fossil fuel power generation to shut down by 2035, with the exception that unabated natural gas generation could be used for up to 450 hours per year, per generator. As Premier Danielle Smith has pointed out, those hours would have been used up by the end of January in the calendar year of 2023, meaning by this time of year, Alberta’s grid, if those regulations were followed to the letter, would effectively be in almost total blackout. And to compound the situation, not only does the federal government expect provinces like Alberta and Saskatchewan to replace all that power generation in 11 years, two months and nine days, but also be on the path of increasing total power generation by a factor of 2.5x in 26 years, two months and nine days.

Brian Zinchuk

Brian Zinchuk is editor and owner of Pipeline Online

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Alberta

Alberta government should eliminate corporate welfare to generate benefits for Albertans

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From the Fraser Institute

By Spencer Gudewill and Tegan Hill

Last November, Premier Danielle Smith announced that her government will give up to $1.8 billion in subsidies to Dow Chemicals, which plans to expand a petrochemical project northeast of Edmonton. In other words, $1.8 billion in corporate welfare.

And this is just one example of corporate welfare paid for by Albertans.

According to a recent study published by the Fraser Institute, from 2007 to 2021, the latest year of available data, the Alberta government spent $31.0 billion (inflation-adjusted) on subsidies (a.k.a. corporate welfare) to select firms and businesses, purportedly to help Albertans. And this number excludes other forms of government handouts such as loan guarantees, direct investment and regulatory or tax privileges for particular firms and industries. So the total cost of corporate welfare in Alberta is likely much higher.

Why should Albertans care?

First off, there’s little evidence that corporate welfare generates widespread economic growth or jobs. In fact, evidence suggests the contrary—that subsidies result in a net loss to the economy by shifting resources to less productive sectors or locations (what economists call the “substitution effect”) and/or by keeping businesses alive that are otherwise economically unviable (i.e. “zombie companies”). This misallocation of resources leads to a less efficient, less productive and less prosperous Alberta.
And there are other costs to corporate welfare.

For example, between 2007 and 2019 (the latest year of pre-COVID data), every year on average the Alberta government spent 35 cents (out of every dollar of business income tax revenue it collected) on corporate welfare. Given that workers bear the burden of more than half of any business income tax indirectly through lower wages, if the government reduced business income taxes rather than spend money on corporate welfare, workers could benefit.

Moreover, Premier Smith failed in last month’s provincial budget to provide promised personal income tax relief and create a lower tax bracket for incomes below $60,000 to provide $760 in annual savings for Albertans (on average). But in 2019, after adjusting for inflation, the Alberta government spent $2.4 billion on corporate welfare—equivalent to $1,034 per tax filer. Clearly, instead of subsidizing select businesses, the Smith government could have kept its promise to lower personal income taxes.

Finally, there’s the Heritage Fund, which the Alberta government created almost 50 years ago to save a share of the province’s resource wealth for the future.

In her 2024 budget, Premier Smith earmarked $2.0 billion for the Heritage Fund this fiscal year—almost the exact amount spent on corporate welfare each year (on average) between 2007 and 2019. Put another way, the Alberta government could save twice as much in the Heritage Fund in 2024/25 if it ended corporate welfare, which would help Premier Smith keep her promise to build up the Heritage Fund to between $250 billion and $400 billion by 2050.

By eliminating corporate welfare, the Smith government can create fiscal room to reduce personal and business income taxes, or save more in the Heritage Fund. Any of these options will benefit Albertans far more than wasteful billion-dollar subsidies to favoured firms.

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Alberta

Official statement from Premier Danielle Smith and Energy Minister Brian Jean on the start-up of the Trans Mountain Pipeline

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Alberta is celebrating an important achievement for the energy industry – the start-up of the twinned Trans Mountain pipeline. It’s great news Albertans and Canadians as this will welcome a new era of prosperity and economic growth. The completion of TMX is monumental for Alberta, since this will significantly increase our province’s output. It will triple the capacity of the original pipeline to now carry 890,000 barrels per day of crude oil from Alberta’s oil sands to British Columbia’s Pacific Coast.
We are excited that Canada’s biggest and newest oil pipeline in more than a decade, can now bring oil from Edmonton to tide water in B.C. This will allow us to get our energy resources to Pacific markets, including Washington State and California, and Asian markets like Japan, South Korea, China, and India. Alberta now has new energy customers and tankers with Alberta oil will be unloading in China and India in the next few months.
For Alberta this is a game-changer, the world needs more reliably and sustainably sourced Alberta energy, not less. World demand for oil and gas resources will continue in the decades ahead and the new pipeline expansion will give us the opportunity to meet global energy demands and increase North American and global energy security and help remove the issues of energy poverty in other parts of the world.
Analysts are predicting the price differential on Canadian crude oil will narrow resulting in many millions of extra government revenues, which will help fund important programs like health, education, and social services – the things Albertans rely on. TMX will also result in billions of dollars of economic prosperity for Albertans, Indigenous communities and Canadians and create well-paying jobs throughout Canada.
Our province wants to congratulate the Trans Mountain Corporation for its tenacity to have completed this long awaited and much needed energy infrastructure, and to thank the more than 30,000 dedicated, skilled workers whose efforts made this extraordinary project a reality. The province also wants to thank the Federal Government for seeing this project through. This is a great example of an area where the provincial and federal government can cooperate and work together for the benefit of Albertans and all Canadians.
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