Canada's new electricity regulations: How the Liberals want to get to net-zero

Nationalpost.com
Aug. 17, 2023

The Liberal government has announced new regulations that would force provinces to ensure they have net-zero electricity grids by 2035.

For several provinces, this isn’t a massive deal. British Columbia and Quebec already have considerable amounts of hydro power, for example, and Ontario and Newfoundland and Labrador also have lower-emissions electricity systems.

But, it’s less straightforward in four provinces: Alberta, Saskatchewan, New Brunswick and Nova Scotia. In those provinces, fossil fuels make up a large part of the electricity mix.

While the politics of this change are relevant -- Alberta and Saskatchewan’s leaders are highly opposed -- so, too, are some of the financial and technological challenges that would need to be overcome to achieve what the Liberal government wants.

The National Post spoke to Andrew Leach, a University of Alberta energy and environmental economist, to get an explanation of what, exactly, is going on with the clean electricity regulations. This conversation has been condensed and edited for clarity and length.

What exactly is happening?
Basically, what (the Liberals are) doing is setting end-of-life conditions or prohibitions on using natural gas and oil to generate electricity in all but certain circumstances.

So, if you have other sources of electricity that generate greenhouse gases, you’re going to have to, as a power generator, as a Crown corp. or what have you, find other sources of power by the time those facilities reach what the regulations define as their end of life -- which is either 2035 or 20 years after they come into service.

So if you have, say, a natural gas plant that went online in 2023, it could stay online until 2043?
Correct.

(Liberal Environment Minister Steven) Guilbeault is getting criticized for these “loopholes” by the environmental movement, for allowing different types of gas generation, for not just simply prohibiting natural gas and oil generation. And of course from Alberta, they’re saying there’s no flexibility, the lights are going to go off in 2035.

And there’s actually pretty significant flexibility in the (regulations).

How are the Liberals actually going to enforce this?
There’s carrots and sticks.

So the clean-electricity regulations that came out last week, those are created under the Canadian Environmental Protection Act. And so it’s federal environmental legislation, and this is an add-on regulation under that piece of legislation. Previously, regulations made under that environmental protection (law) have been challenged.

The courts determined that these were valid federal regulations under Parliament’s ability to enact criminal laws.

It’s not part of the Criminal Code, but it’s legislation that has the characteristic of criminal law. So that’s within the powers of the federal government.

This probably varies by province, but where is Canada at in terms of reaching a net-zero electricity grid?
The crux of the issue is that you have grids that are (fairly) net zero already or systems that are (fairly) net zero already in Quebec and Manitoba and B.C. And then Ontario, you have quite a low emission system, (and) Newfoundland and Labrador.

But then you get into New Brunswick, Nova Scotia, Alberta and Saskatchewan and things are very, very different.

And so you have much more emissions-intensive systems and certainly in the case of Alberta and Saskatchewan, and to some degree in New Brunswick, Nova Scotia as well, you have systems that are not integrated with other markets. So they’re sort of electricity islands, and on those islands, there’s very little electricity generating capacity that doesn’t come from coal, natural gas.

Could Alberta, say, toss up some dams for hydro power?
There is hydro potential in the north and Slave River but there’s significant environmental concerns and, of course, First Nations concerns with respect to damming that.

The Peace Country likely has some potential, but again, that’s something that we haven’t exploited in the same way as other jurisdictions have. And you know, we haven’t had to because … we’re sitting on an island of natural gas, so for the most part, natural gas power has been historically cheap for us.

How could Alberta, Saskatchewan, Nova Scotia and New Brunswick meet the government’s targets?
It’s very different stories in each of those provinces.

It would mean building carbon capture and sequestration on, most likely, some of their existing plants. That would mean some new facilities. It would probably mean a long, hard look at nuclear energy in Saskatchewan.

And it would mean more wind and solar, it would mean more interconnection to other electricity systems with more hydro potential, maybe it would mean hydro in northern Saskatchewan.

To what extent is this even possible?
Yeah, I mean, it all turns on what’s your definition of possible. We have a group at the University of Alberta that I’m part of, and we run an hourly electricity model of Alberta.

And we can create a net-zero Alberta electricity system by doing a lot of those things I just talked about -- more connection to B.C. carbon capture and storage plants/hydrogen power plants, a lot more wind, a little bit more solar, some storage, and you can make it work.

But it’s a radically different generation sector than the one that we have right now.

And it tips the balance from a minimal capital investment and a lot of expense to operating. Now you’re moving to a lot of installations that are more capital intensive -- solar panels, wind turbines, batteries that don’t cost you a lot to operate, but they cost you a lot up front.

So it’s a change in the way and the types of investment, in the way that investment would happen.