Good morning.
Wendy Cox in Vancouver this morning.
Federal Environment Minister Steven Guilbeault released a discussion paper Friday outlining changes to draft regulations aimed at reducing carbon emissions from Canada’s electricity grid. He characterized the changes, which are significant, as a nothing-to-see-here moment.
“This is a totally normal process,” he said. “We put out draft regulations. We consult. We listen to what people have to say. And then we adjust. We do that all the time.”
Except that the response to the original regulations went well beyond what is normal even in a country used to fractious disagreements among provinces on regulations of all kinds.
Provinces warned the original rules, introduced last year, would raise the risk of blackouts, a concern that was amplified after power shortages in Alberta during last month’s extreme cold snap.
As originally written, the regulations aimed to achieve a net-zero emission grid by 2035 by phasing out gas-fired power plants that lack carbon-capture technology. Greenhouse-gas emissions from large generation facilities would be capped at 30 tonnes per gigawatt hour, and plants generating emissions above that level would be forced to shutter other than under very limited circumstances.
The changes were met with howls of outrage from Alberta, prompting the province to trigger its Sovereignty Act last November, giving it the power to reject federal laws or regulations that it believes will “negatively impact the province” or those it considers “unconstitutional” or beyond Ottawa’s jurisdictional scope. Premier Danielle Smith argued the original version of Ottawa’s Clean Electricity Regulations would infringe on Alberta’s constitutional right to manage its electricity industry. Electricity falls under provincial jurisdiction in Canada. She argued the 2035 goal is unrealistic in a province that relies heavily on natural gas, a producer of greenhouse-gas emissions, to generate power.
“The problem with the federal approach is it’s all stick and no carrot,” Smith said at a meeting of premiers last summer. “We can meet green-energy standards, we can meet emissions targets, but we have to have growing economies.”
In November, Saskatchewan triggered its own version of Alberta’s Sovereignty Act, the Saskatchewan First Act, to establish a tribunal to study the economic effects of the rules.
What appeared to especially irritate Alberta and Saskatchewan, as well as New Brunswick, was the effort to blanket the country with one policy when, as The Globe’s editorial board has pointed out, Canada is really made up of 10 different jurisdictions taking opposing routes to power generation. While Saskatchewan and Alberta reject Ottawa’s goals, Ontario is adding more fossil-fuel power. Quebec and British Columbia are blessed with an abundance of hydroelectricity. Manitoba is also almost 100-per-cent clean, but balked last year at the ability to clean up the rest of its grid by 2035.
“The absence of ambition is staggering,” the editorial board wrote last summer.
Still, the changes suggested in the paper released Friday by Guilbeault – who wasn’t having the best week after suggesting his government would stop investing in new road infrastructure – represented a softening of the original plan.
The changes would give grid operators more flexibility to continue operating gas-fired plants past the 2035 date, including by setting annual emissions limits rather than requiring a specific performance standard in order for plants to operate at all. The changes would also allow the purchase of offsets when those limits were exceeded. Utilities or Crown corporations would be able to pool the emission limits of their facilities within a jurisdiction, to give them more operational discretion, rather than separately applying the rules to each plant.
The document acknowledges criticism that the rules as originally written would cause too much disruption to the system.
“We’re happy to see a shift toward more flexibility,” said Michael Powell, the vice-president for government relations with Electricity Canada. He added, however, that “the devil’s going to be in the details” – noting in particular that the industry association’s members will be waiting to see the specific formula for determining how much gas plants can operate, as well as how the offset scheme might work.
This is the weekly Western Canada newsletter written by B.C. Editor Wendy Cox and Alberta Bureau Chief Mark Iype. If you’re reading this on the web, or it was forwarded to you from someone else, you can sign up for it and all Globe newsletters here.
Wendy Cox