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Net-zero power system in Alberta ‘possible’ by 2035 but pricey: report

Click to play video: 'Net-zero power system in Alberta could cost $52B: report'
Net-zero power system in Alberta could cost $52B: report
WATCH: A new report suggests Alberta can achieve a net-zero power system by 2035. But as Dan Grummett explains, the cost to consumers could come as a shock – Jun 29, 2022

A new report shows transitioning to a net-zero power grid by 2035 in Alberta could require up to $52 billion in investments.

Published by the Alberta Electric System Operator (AESO), the study lays out three scenarios by which the province could meet the Federal goal, involving various combinations of renewable energies, storage, carbon capture and hydrogen technologies.

AESO said the projected price tag does not include what could be required for electricity distribution locally, as more Albertans adopt solar panels and electric vehicles.

“We don’t yet have a full picture of what a full transformation to a net zero electricity grid might look like,” said Miranda Keating Erickson, AESO vice-president of markets. She added that time might be an equally large barrier to achieving net zero in 13 years.

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Nearly all the required investment would have to come from private industry, Keating Erickson added — a notion that has big implications for consumers.

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The report predicts a unit of electricity in Alberta for all net zero scenarios may be 40 per cent higher than current rates by 2035.

“At present, (rates are) around $100/megawatt-hour because gas prices are so high. This report suggests by 2035, electricity prices will increase by $50/megawatt-hour,” said Evan Bahry with Independent Power Producers Society of Alberta.

“So it’s a significant increase to manage this transition.”

Click to play video: 'Can Alberta’s electricity grid reach net zero by 2035?'
Can Alberta’s electricity grid reach net zero by 2035?

Bahry said industry is looking to the provincial and federal governments for policy support to ease the burden.

In April, Alberta Associate Minister of Natural Gas & Electricity Dale Nally said industry had “zero confidence” the province could achieve a net zero power grid by 2035.

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On Wednesday, Nally said the AESO report only reinforced his position.

“The problem is the risky and ambitious assumptions made in this report,” he said. “They’re going all-in on technologies that may be there in the future but they may not be.”

Nally added that ultimately, it’s up to Ottawa to come up with a way to make the transition affordable.

“If they’re going to be coming up with these kinds of ambitious standards, they need to work with the province,” he said. “And they need to work with industry. They haven’t done that.”

The Federal government has committed to achieving a net zero emission by 2050 to avert the worst impacts of climate change.

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