(Calgary) Scalded cat fears cold water.
This proverb reflects the state of mind of some Albertans in the face of the development of renewable energies in their province.
Like Jason Schneider, the elected prefect of Vulcan County.
Like many leaders in rural areas, Mr. Schneider recalls that municipalities had suffered greatly from the slump in oil prices a decade ago. Many bankrupt companies had left billions of dollars in unpaid invoices.
In Vulcan, hundreds of ownerless wells stretched as far as the eye could see. All needed cleaning. The amount of municipal taxes due exceeded 9 million.
Today, Mr. Schneider does not jump for joy when he looks at wind farms or solar panels that multiply. He fears a future energy crisis and wonders who will pay for the mishaps next time.
“These are important industrial developments,” he notes. The costs of surrender being will be substantial. We are already seeing the warning signs, but we are being ignored. »
Across rural Alberta, there are concerns about the long-term consequences of the rise of renewable energy in the province.
The speed of this development and its pace are absolutely phenomenal.
Alberta has long relied almost entirely on coal to generate its electricity. Today, wind and solar installations have a capacity of 3800 megawatts (MH), of which 1350 have been commissioned in the last 12 months. Facilities capable of generating up to 1,800 MH are under construction, so the province could exceed the target, set in 2016, of generating 30% of its electricity from renewable sources by 2030.
For example, in Vulcan County, home to the country’s largest solar farm and one of the largest wind farms in western Canada, renewable energy producers account for more than 40% of local tax base, displacing oil and gas companies as the main source of municipal government revenue.
If on the one hand, many are those who warmly welcome these new revenues, others are already sounding the alarm.
For example, the Association of Rural Municipalities of Alberta recently passed a resolution calling on the provincial government to protect ratepayers from the costs associated with the dismantling of renewable energy infrastructure.
Specifically, she wants the government to ask developers to pay upfront for future property refurbishment. This way, municipalities won’t have to foot the bill if a business becomes insolvent and closes.
“We learned well and all Albertans learned well that the cheapest way not to pay for land rehabilitation is to go bankrupt,” said Paul McLauchlin, president of Rural Municipalities of Alberta.
Some of these solar installations are built by one company, sold to another company. I spoke to a guy who works for a fifth owner at a solar farm that’s been around for two years. There are several small businesses. One wonders if they have the means to pay for the rehabilitation of a property.
Paul McLauchlin, President of Rural Municipalities of Alberta
In Alberta, there is an association funded by the oil industry that pays to dismantle oil and gas infrastructure and rehabilitate land.
However, there is no equivalent for the renewable energy sector. Companies, on the other hand, must present an outline of how they intend to restore a property before obtaining the green light for their project.
Another difference: an owner can give a lease to an operator on a voluntary basis. For the exploitation of fossil fuels, an owner does not have the right to refuse producers to exploit a well on his land.
Evan Wilson, Senior Director, Political and Government Affairs, Canadian Renewable Energy Association, explains that it is the responsibility of the landowner to include clauses regulating the sharing of costs related to rehabilitation.
“Landowners can refuse the construction of a facility at home,” he points out. So that puts a lot of pressure on our members to make sure these landlords feel comfortable with the terms of a rent. »
Sara Hastings-Simon, an expert from the University of Calgary, says she understands the concerns of municipalities.
However, she finds it bizarre that new regulations for the renewable energy sector are desired when the problem of abandoned wells demonstrates that the system governing oil and gas energy needs a good overhaul.
According to the Alberta Energy Regulator, there are more than 83,000 inactive wells in the province and nearly 90,000 more that have been taken out of service without being fully rehabilitated.
The Parliamentary Budget Officer estimated in January 2022 that orphan well cleanup costs will reach $1.1 billion by 2025
“We have to make sure that our whole industry develops in such a way that the costs are not passed on to the public,” says M.me Hastings Simon. It will make more sense for the province to look at the energy sector more broadly rather than picking the fastest growing one. »