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  • Writer's pictureCameron McNeill

Alberta’s Power Scare: Energy Solutions in a Changing Economy



Written by: Cameron McNeill

Edited by: Kyra Odell


Context

On January 14th, 2024, a province-wide emergency alert warned Albertans of a potential rotating power outage, an event the province hasn’t seen in over 11 years. The AESO (Alberta Electric System Operator) stated that the warning came as a result of extremely high electricity demand combined with minimal contributions from otherwise staple plants. While Alberta’s grid demand reached an all time high on the night of the eleventh, high winds and power output from major providers ensured that electricity needs were met. While the power outage was ultimately avoided due to Alberta’s immediate response to calls for reduced energy use, the emergency alert has prompted discussion around reforms to Albertan energy policy. 


Alberta’s Energy Only System vs a Capacity Market

While the exceptional level of electricity demand came as a result of extreme weather conditions, many experts are pointing to Alberta’s unique energy-only grid system as a cause for concern. Unlike all other Canadian provinces which employ some variation of a capacity market, Albertan electricity firms are paid only for the electricity they produce. In a capacity market, these same firms are compensated for their ability to maintain additional capacity. While the specific cost structures of these markets vary, they generally aim to ensure the grid will have enough energy even in cases of heightened provincial demand. This might mean providing resources to offset the costs of additional backup infrastructure or paying a premium for energy when the grid is at peak demand. So why hasn't Alberta adopted a capacity market policy? The simple answer is cost. Not only would the government be forking out taxpayer money to keep additional grid capacity on standby, but they would also need to offset the costs of plants implementing additional infrastructure. While the AESO had plans to implement a capacity market grid system under Rachel Notley’s NDP government, this plan was scrapped when the UCP won the 2019 Alberta general election. This decision is one that has seen recent scrutiny as a result of the January 14th blackout scare (Dryden, 2024). When asked whether a capacity market could have prevented the grid emergency, Alberta’s Affordability and Utilities minister Nathan Neurdof said “it's hard to go back in time and see what would've come about that way” (Dryden, 2024). Despite this comment, it is reasonable to assume that investment in backup grid resources would have at least offset some of the grid strain considering that this is what capacity grids are designed to do. While ultimately the fact remains that no power outage did occur, the question lingers whether Alberta will be pushed to adopt a capacity-energy market in the next election.


The Role of Renewables

Beyond the question of Alberta’s electricity grid structure, an important factor in the grid's power deficit was the near nonexistent contribution of Alberta’s wind plants. At the time of the alert, only two of Alberta’s 43 wind farms were producing any energy whatsoever (Zinchuk, 2024). While it may seem reasonable to assume that this was the result of low wind, meteorological data says otherwise. The poor performance of the wind farms actually stems from the severe weather. At sufficiently low temperatures, the integrity of the turbine blades can be compromised leading to a high probability of fracture and/or damage. Because of this, most of Alberta’s wind plants ceased operation to protect their infrastructure. Additionally, Alberta’s 88 solar farms were not producing any power as the sun had set, forcing Alberta’s grid to lean into unclean energy sources such as coal. At the time of the emergency alert, Alberta’s coal plants were producing 135 times the amount of electricity as all of their wind and solar farms combined (Zinchuk, 2024). This is a metric which could be combatted through a greater emphasis on electricity storage among sustainable energy plants.

One such battery has been brought to market by E-Zinc, a Canadian company that has created a zinc based battery capable of long-term electricity storage. This technology is extremely valuable, as common lithium based batteries will typically drain as time passes and cannot operate for the same duration as their zinc counterparts. This technology would allow green energy plants to retain a significant emergency power supply which it could feed back into the grid in the case of an emergency. The issue is that Alberta’s energy-only grid system would not see utilities companies compensated for the purchase and installation of these battery systems as a result of the energy-only policy. Considering that no power outages actually occurred, Albertans may overlook the importance of implementing a capacity grid system; but if the power outage was avoided, why is a capacity grid so important? With the federal government aiming to transition to a 100% zero emissions vehicle market by 2035 and a provincial population that continues to accelerate, we can expect electricity demand to skyrocket. This exponential change in demand will require our government to not only invest in additional infrastructure capable of supporting such a strain on the grid, but in emergency resources that ensure we are prepared for future surprises. While technology will likely develop to increase the reliability of wind energy among other renewable sources, battery technology will be central to ensuring Albertans feel safe relying on these sources for the bulk of their power. 


The Premier’s Stance

While the recent blackout risk has tested the resourcefulness of Alberta’s energy grid, the involvement of wind in the power deficit is fuel for premier Danielle Smith’s belief in the unreliability of renewable energy. In August, the premier put a seven month moratorium on the approval of any new wind or solar projects, a decision she attributed in part to the unreliability of renewables stating “when we were in the winter, …several times the grid almost failed because we didn’t have enough power, and you can’t call up wind and solar on demand” (Markusoff, 2023). With Alberta drawing on solar and wind energy for 17% of their provincial power supply in 2022, Smith’s concern around the reliability of renewables is well-founded. The recent grid emergency is further support for this claim, but a moratorium on these projects does not target the heart of the issue. Continued investment in long-term electricity storage solutions would ensure that renewable energy plants have the ability to contribute to the grid, even in the face of poor weather conditions. Furthermore, the implementation of this technology would allow Alberta to continue to reach milestones in its path to net zero carbon emissions by 2050 while giving citizens the trust they deserve in the reliability of the grid. 


Conclusion

While it is easy to see events such as Alberta’s recent grid emergency as evidence of the danger that lies in renewables, it is important to understand the nuance of these events. While the limited operation of Alberta’s wind and solar plants had a hand in the power deficit, it is an issue that could be easily avoided through the implementation of a capacity grid. Such a decision  would not only strengthen the reliability of Alberta’s grid, but drive innovation within the province's energy sector more broadly.


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References:


Current provincial population estimates. (2024, January 17). www.alberta.ca. https://www.alberta.ca/population-statistics#:~:text=As%20of%20 October%201%2C%202023


Dryden, J. (2024, January 18). Alberta pulled plug on changes to its electricity market in 2019 — would they have helped prevent grid risks? CBC. https://www.cbc.ca/news/canada/calgary/ucp-aeso-weather-electricity-capacity-1.7085201


Gollom, M. (2023, December 25). The federal government wants Canadians to switch to electric vehicles. Are they interested? CBC. https://www.cbc.ca/news/canada/electric-vehicles-mandates-market-government-.7066264#:~:text=Environment%20Minister%20Steven%20Guilbeault%20last


Markusoff, J. (2023, August 15). Assessing Danielle Smith’s latest reasons for pausing Alberta wind and solar, to the letter. CBC. https://www.cbc.ca/news/canada/calgary/danielle-smith-wind-solar-power-freeze-letters-analysis-1.6936415


Zinchuk, B. (2024, January 12). Alberta goes under grid alert for just under 5 hours on Jan. 12. Pipeline Online. https://pipelineonline.ca/alberta-goes-under-grid-alert-5-hours/#/?playlistId=0&videoId=0




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