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Current Electricity Plan Just Not Feasible

The Federal Government has mandated provinces to be Net-Zero in electricity production and distribution by 2035, in tandem with huge increases in electricity demand. Is it feasible? The evidence suggests it simply isn’t possible, let alone affordable.

The core challenge is this: the federal government is taking rapid and non-negotiable steps toward greater electrification of our economy, such as a mandate to sell only electric vehicles by 2035. At the same time, it is requiring that electricity production and distribution achieve net-zero by 2035. Taken together, it is not merely aggressive but potentially very, very costly to consumers who will have to pay the bill for massive and rapid changes.

Some provinces are close to the 2035 target because they have ample hydro power, or invested in nuclear power decades ago. Other provinces – including Alberta – rely on natural gas to generate electricity. In Alberta, natural gas has totally replaced coal (the last coal nugget was burned on June 16, 2024), reducing emissions by about 50%. Alberta says it could reach net-zero by 2050, but not by 2035. The challenge is not just production, but expanding the electricity distribution system.

Demanding Answers from Federal Officials

Electricity currently supplies about 40% of power demand; industrial power (mainly natural gas) is 30%, and motive fuel is the remaining 30%. Demand for electrical power is growing, in large part due to rapidly escalating power-hungry technology, and in part due to government mandates – but how will Canada both keep pace with that growing demand while also displacing 60% of the current power supply to meet the federal mandate for net zero by 2035?

The Natural Resources Committee has begun a study of Canada’s electricity grid and network, to understand inter provincial tie-ins and gaps, opportunities, and challenges to increase electrical production and distribution across Canada.

From my questioning of federal officials, it became obvious that this government has no clear plans to meet the growing demand for Canada’s electricity needs, while simultaneously phasing out fossil fuel energy.

In fact, they kept saying the provinces will do it. If they expect provinces to solve the riddle, then why is the federal government stepping on their toes while they try to do it?

You can follow this study on the website for the Standing Committee on Natural Resources.

Electricity Advisory Council Report

The Minister of Natural Resources convened the Canada Electricity Advisory Council in May 2023 to advise on policies to enable the electricity sector to transition to net-zero by 2035.

Most notable among the Council’s recommendations is a view that the feasible target date is 2050, not 2035: “The federal government should modify the condition currently proposed for the Clean Electricity ITC [Investment Tax Credit] for a provincial or territorial government to commit to a net-zero electricity system by 2035 to instead focus on the development of energy roadmaps for a net-zero or carbon-neutral energy system by 2050.” 

The Council also said strongly that the plan must allow for flexibility for each province to reach the goals according to their own circumstances, and that previous federal mandates have been too prescriptive: “the original Clean Electricity Regulations did not provide sufficient flexibility for utilities, system operators, and market participants to achieve the desired balance between decarbonization, cost, and reliability.

They noted that achieving the targets will be considerably more costly for provinces that currently rely on fossil fuels, and steps need to be taken to spread the cost more equitably, including provisions for groups such as lower-income Canadians, and indigenous, rural and remote residents: “The federal government also has an important role to play in addressing fairness and sharing the costs of the transition.”

The Council points out that meeting the escalating demand for electricity will require massive new builds, which are today hindered by cumbersome processes at every level of government: “without systemic reform of approval processes for essential clean electricity projects, Canada’s ability to achieve its climate goals will be in dire jeopardy. … Canada will need competitive finance, tax, trade, and labour policies to succeed.”

Time taken to secure permits for energy projects around the world. Canada is the second slowest.

The Report contains 28 recommendations with background information on why the recommendation was made and how it will work.

Read the Report here.

Province of Alberta Response

The Province of Alberta released the following statement on the Report:

Premier Danielle Smith and Minister of Environment and Protected Areas Rebecca Schulz issued the following statement on the Canada Electricity Advisory Council’s final report:

“The Canada Electricity Advisory Council’s latest report echoes Alberta’s long-standing warning: Ottawa’s one-size-fits-all electricity regulations are a dangerous, costly and unrealistic path to failure.

“For over two years, provinces, utilities, businesses and Canadians have demanded federal electricity regulations that reduce emissions without sacrificing affordability and reliability. Yet the federal government has stubbornly stuck to its plans to implement unrealistic targets for a net-zero grid by 2035, regardless of the costs and risks to Albertans.

“Now the federal government’s own expert advisory body is sounding the alarm. The Canada Electricity Advisory Council is calling for less ideology and more common sense, rejecting rigid mandates that ignore regional realities. Alberta is rapidly decarbonizing its grid, but we refuse to gamble with winter blackouts and crippling energy bills.

“This federally appointed committee recognizes that the arbitrary 2035 deadline is unrealistic and unattainable – and has instead recommended that the federal government support the development of provincial and territorial energy roadmaps for a net-zero or carbon-neutral energy system by 2050.

“We urge the federal government to listen to this report and to the many concerns raised by Canadians, industry and provinces across the country. Abandon the reckless 2035 targets and partner with us to build a modern, reliable and affordable electricity grid that truly serves Canadians.

“Alberta already has a plan to reach carbon neutrality by 2050 – the federal government should work with us to achieve this goal.”