Alberta looking to Ontario for an ally on electricity regulations

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Hot on the heels of the odious discussion of leaving the Canada Pension Plan and taking more than half the fund’s assets in the process, it’s unlikely anyone in the rest of Canada wanted to hear more from the Alberta government this week.

The province’s contention that blackouts could hit because of the federal government’s coming Clean Electricity Regulations appears, at first blush, to be digging the credibility hole deeper. The scenario of a mother of a baby struggling without a light to turn on in the middle of the night – a flourish added by Alberta Environment Minister Rebecca Schulz during a news conference on Thursday – is designed to both shock and tug on people’s heartstrings.

Federal Environment Minister Steven Guilbeault said in an e-mail any claim that building a clean electricity grid in the next dozen years will lead to blackouts is “misinformation, designed to inflame not inform.”

But within Alberta’s combative $8-million national advertising campaign against the draft federal regulations, there are legitimate concerns about the pace of Ottawa’s ambitions. The Smith government is ahead of the curve in knowing that electricity systems are the country’s next difficult topic, especially for those provinces without abundant hydro resources.

In fact, there looms a federal-provincial fight on electricity that extends beyond Edmonton and Ottawa, one that will likely include Saskatchewan, New Brunswick and Nova Scotia, and possibly the country’s most populous province. Ontario could be a lukewarm ally in Alberta’s battle against Ottawa’s current plan for a net-zero grid.

Michael Dodsworth, a spokesperson for Ontario’s energy ministry, said in an e-mail Friday that Ontario’s Independent Electricity System Operator (IESO) has advised that Ottawa’s draft regulations don’t reflect their input, or their real-world experience.

“The IESO has told the ministry the current draft regulation has provisions that would impede an orderly energy transition, and they predict the regulations as currently drafted could slow the electrification of our economy by compromising the reliability of the grid and increasing electricity costs this decade.”

He also said Ontario already has one of the cleanest electricity grids in the world, and wants to build a 100-per-cent clean grid “in a way that prevents electricity rates from skyrocketing and protects people and businesses from brownouts and blackouts.”

Ontario is in a tricky situation. Being able to advertise that it has a mostly clean power grid does help the province in attracting investment and manufacturing might. But Ontario will also need much more electricity as environmental imperatives, and population and economic growth, spur more demand. Like Alberta, the Ford government sees a continued role for natural gas.

Of course, this doesn’t have to be all-out war. The federal government is receiving feedback on its draft regulations, and they aren’t necessarily what will be put into law. Ottawa and the provinces could figure it out like grownups. There is potential common ground, including on a drive toward more nuclear power and greater power-sharing, or interties, between provinces.

But Alberta in particular has good reason not to trust Ottawa’s plans, which target coal and natural gas power generation. The federal government talks in broad sweeps about the country’s electricity system – noting for instance that 85 per cent of the country’s generation comes from hydro and other non-emitting sources – instead of specifics.

The makeup in Alberta is much different. The province is on the verge of phasing out coal, greatly reducing its emissions, but will still rely on natural gas generation for nearly three-quarters of its power. Industrial demand is high. The Alberta Electric System Operator said, in words similar to Ontario’s, that Alberta cannot decarbonize its grid in the time frame spelled out in Ottawa’s proposed electricity regulations.

Alberta took the further step of saying the regulations put consumers and businesses at risk of blackouts and surging power rates. That assessment from the agency in charge of planning and running Alberta’s electricity network has been criticized for its messaging being far too in line with the governing party’s. But no one is disputing the agency’s concern that “regardless of how much intermittent wind and solar Alberta has, the provincial grid will need sufficient dispatchable generation to meet the cold, dark winter nights that we have in this province.”

As much as Ottawa emphasizes that the United States and other G7 nations are pursuing similar net-zero electricity goals, those countries are also facing many of the same challenges as Canada. Globally, demand could double or triple in the decades ahead, as the world electrifies more of its energy systems to reduce the use of fossil fuels. Major U.S. electricity operators spent Thursday speaking to the House of Representatives about their grid concerns, and fears reliability will be compromised if polluting generators are retired before they are sufficiently replaced.

Back in Canada, Ottawa is attempting to regulate a realm that’s not only one of provincial jurisdiction, but is also where provincial – not federal governments – pay the political price for any negative consequences, including spikes in electricity costs. A key example of this is the Ontario Liberals’ electoral loss in 2018, which came in part because of missteps on the electricity file.

Ms. Smith’s discussion Thursday that the Alberta government is drafting a motion it could use, if necessary, under its untested Sovereignty Act is provocative. But no matter what, we’ve entered a new age of fighting about climate and electricity in Canada.

It has to be kept in mind that the Trudeau Liberals are desperate to shore up their sagging polling numbers, and the party certainly doesn’t contemplate much how policies will land in Alberta when making its political calculations. But it does consider Ontario.

It’s all going to be complicated, and perhaps ugly. But forcing the country to think more about electricity – including the potential the situation could be made worse by federal legislation crafted far away from where people will live with the consequences – is not wrong. Even if this message comes in most dramatic fashion from Alberta.