Smith stands with Moe on 'affordable' electricity, wants 'realistic' net-zero transition

UCP leader Danielle Smith clarified Friday that a re-elected UCP government would stand with Saskatchewan against Ottawa's attempt to 'just transition' their respective electricity grid to net zero by 2035.

Smith stands with Moe on 'affordable' electricity, wants 'realistic' net-zero transition
Facebook/Danielle Smith and Facebook/Scott Moe
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Ottawa and Saskatchewan have engaged in a war of words over net-zero electricity, with the federal environment minister making veiled threats over provinces failing to adopt the Clean Electricity Standard. Saskatchewan joined Alberta in refuting those standards, citing concerns about the affordability of residential utility bills.

Environment Minister Steven Guilbeault told Saskatchewan it will be illegal to operate coal-fired power plants past 2030 without technology to reduce carbon emissions. "Not complying with this regulation would violate Canada's Criminal Code," he told reporters.

On May 17, the Saskatchewan Party and NDP Opposition voted unanimously to support the province's plan for affordable, reliable power generation to 2035 and beyond. That includes not phasing out conventional coal by 2030 or transitioning their electricity grid to net zero by 2035.

"We're going to continue to chart Saskatchewan's path," Premier Scott Moe told reporters. "It may not necessarily be Canada's path, and we'll have more details in the coming weeks."

Smith told Rebel News Friday that a re-elected UCP government intends to "stand with Premier Scott Moe."

According to the Canadian Environmental Protection Act (EPA) framework, provinces must either decommission their coal power plants, transition them to natural gas, or outfit them with carbon-capture systems by 2030. To ignore the framework would constitute a Criminal Code violation.

Moe and Saskatchewan Justice Minister Bronwyn Eyre accused Ottawa of intruding on provincial jurisdiction concerning natural resources and energy through the framework.

"We reserve the right provincially to choose how we will produce that power, whether natural gas or coal-fired. It's our interpretation that these decisions on how you produce power are most certainly in provincial jurisdiction," said Moe. 

Eyre added the province could invoke the Saskatchewan First Act to counter federal overreach. 

"We can't invest in powering this province — and keeping rates affordable as we do it — with these threats hanging over us. That would represent stranded assets to us and an enormous cost for the people of this province," said Eyre.

Rebel asked Smith if she would consider keeping Alberta's coal plants open past 2023 to keep electricity costs down for residents. They are slated to be decommissioned seven years before the federal government timeline.

"Would a re-elected UCP government consider keeping the coal plants open short-term to keep electricity costs down?" Rebel asked the UCP leader. She replied: "We are based principally on natural gas, and Saskatchewan is based on a combination of coal and natural gas.

"Alberta is in a different position than Saskatchewan because of a 'very aggressive' transition to natural gas," continued Smith. "I understand the last of those conversions will be finished this year or next."

"Emissions reduction has to happen at the industrial level - the number one targets are reliability and affordability," she said. 

To ensure affordable electricity, Moe said his government may operate its three coal plants beyond 2030 until the early 2040s. The natural gas plants currently in operation will remain in use until the end of its lifespan.

The province intends to pursue an 'affordable' and 'realistic' plan to increase electricity generation that keeps pace with its economic and population growth. They said reaching net zero by 2050 is more palatable.

The UCP also committed to net zero by 2050 this month and forewarned voters of a "costly" NDP promise to shift the province's electricity grid to net zero by 2035. Smith said doing so would increase electricity bills for Albertans by 40%.

She called it "the most expensive campaign promise proposed this election campaign."

According to the Alberta Electric System Operator (AESO) report, transitioning to a net-zero grid would cost between $44 billion and $52 billion over the next decade. Power generation costs would exceed $92.2 billion during the same period.

On May 4, a reporter asked Smith to clarify the AESO report that questions the net-zero push by 2035.

"The report says the [transition] would have a largely negligible impact on GDP growth. What is your response to that?" asked the reporter. Smith replied: "It would result in a cumulative reduction of $35 billion." 

"We have two reports — the AESO report that said we would have to invest $52 billion to get to a net zero power grid, and then Navius [Research]...said it would have a cumulative effect of reducing GDP by $35 billion," she said.

"After people got over this most recent winter season, a lot of the NDP decisions are coming home to roost. They phased out coal early to natural gas, and billions in stranded costs were worked into ratepayers' bills," continued Smith. 

"I would tell you that that's not going to be affordable for people on fixed incomes and everyday families." 

On July 25, 2016, the Alberta NDP claimed Enron caused $2 billion in power purchase agreement (PPA) losses from Alberta electricity consumers. However, the NDP government amended Alberta's Specified Gas Emitters Regulation by Ministerial Order 13/2015 in June 2015 to increase carbon taxes on large carbon-emitting facilities, including coal-fired electricity generation.

Under these low market price circumstances, all the power purchase agreements (PPAs) either became "unprofitable or more unprofitable." PPA buyers, including Enmax Energy, could rightfully terminate their PPAs per PPA Change in Law Clause 4.3(j) without paying a financial penalty to the Balancing Pool.

After the government sued the buyers for consumers incurring the $2 billion cost, they embarked on a media campaign, alleging a "secret backroom deal" between previous governments and industry to deflect from the NDP carbon tax.

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