Alberta Government announces additional restrictions on renewable energy development rules as pause on new projects ends

In August of 2023, the Alberta Government announced that it was pausing all new approvals of renewable energy (wind and solar) projects for six months pending a review by the Alberta Utilities Commission (the “AUC”) of various matters related to renewable energy development. This measure includes reviewing the effect of renewable development on agricultural lands and “pristine viewscapes”, and the need for project developers to post reclamation security.

With the pause expiring on February 27, the Alberta Government has formally announced the direction its new policy on renewables will take. The new policies will only be applied to renewable project approvals which have not yet been approved – not retroactively to approved projects.

The Minister of Affordability and Utilities, in a letter to the Alberta Utilities Commission, directed the AUC to develop policy for the approval of renewable energy developments which will incorporate the following principles:

• Agriculture first approach. Renewable energy developments will no longer be permitted on Class 1 or Class 2 ‎agricultural lands unless the project proponent can demonstrate the ability of crops and ‎livestock to co-exist with renewable generation.‎
  
  

  With regard to Class 1 and Class 2 agriculture lands, the Ministry of Agriculture and Irrigation classifies land according to the Land Suitability Rating System Class 1 indicates “none to slight” limitation for the production of crops, and Class 2 indicates “slight” limitation for the production of crops. There is no Class 1 land in Alberta.

   

• Buffer zone. A 35 km buffer zone will be established around protected areas‎, as well as around other ‎”pristine viewscapes” to be designated by the province. New wind projects will not be ‎permitted within buffer zones, and other renewable energy developments within buffer zones ‎could trigger the need for a visual impact assessment. In connection with the protection of pristine viewscapes, the AUC will conduct proceedings to consider setbacks from residences or other ‎infrastructure. ‎The Alberta Government has not indicated ‎whether it will consider National Parks in determining buffer zones, nor ‎how the buffer ‎zone concepts will apply to First Nations lands.‎
  
  

  With regard to the definition of “protected areas”, under several statutes (the Provincial Parks Act, the Wilderness Areas, Ecological Reserves, Natural Areas and Heritage Rangelands Act and the Willmore Wilderness Park Act), Protected Areas consist of ecological reserves, wilderness areas, wildland provincial parks, provincial parks, natural areas, heritage rangelands, and provincial recreation areas. See here for a map of protected areas within Alberta and here for a list of protected areas within Alberta.  

   

• Reclamation security. The Alberta Government will develop policies, applicable to all new approvals issued after March 1, ‎‎2024, to ensure that developers post security for reclamation costs. The security may be ‎provided to the Alberta Government, or may be negotiated with the landowner (with evidence ‎provided to the AUC).‎

   

• Crown lands. The development of renewable energy projects on Crown lands will be evaluated on a case ‎by case basis. Legislation is anticipated to come into effect in late 2025.‎

   

• Transmission regulations. Changes to Alberta’s Transmission Regulation are expected in the coming months. Renewable projects should expect changes in how transmission costs are allocated and it is expected that a significant portion of the cost of transmission will be shifted to renewable generators from load customers.

   

• Municipal participation. Municipalities will have enhanced participation rights in AUC hearings (including an automatic right to participate in hearings and increased eligibility for costs).

What’s next

Starting March 1, 2024, the AUC will resume granting approvals for renewable power plant applications.

In Bulletin 2024-03, the AUC outlined updates to the application review process following the expiration of the Generation Approvals Pause Regulation. The Bulletin specifies that the Interim Rule 007 requirements contained in Bulletin 2023-05 for power plant applications, including those related to agricultural land, viewscapes, reclamation security, and land use planning, will remain in effect.

The government has also advised that the AUC will provide greater direction starting on March 1, 2024, and that applications currently in process may be amended to abide by new rules.

It will still be some time until the details of the new rules are known. While the Alberta Government has provided very clear policy direction, there are still a number of steps to be taken by both the Government and the AUC to promulgate new rules as required by the new policy. The AUC has stated that it will engage in stakeholder consultations on the policy, legislative and regulatory changes arising out of the new policy, and that information on the consultation process will be released in due course.