Council full of energy at meeting
The city's north-end power plant off Box Springs Rd. (File photo)
Council went the distance for the second time in a row Monday, plowing deep into the evening but without the theatrics that ended the previous gathering two weeks ago.
Discussions and presentations involving the strategy of the city’s energy division – plus the dollars it provides to the Heritage Savings Reserve – dominated the evening.
Noticeably absent was any mention of the status of the city’s request to the province for it to investigate municipal operations.
Rochelle Pancoast, director of the energy division, played a repeat role from an earlier committee meeting where she presented a detailed past, present and future look at the city’s big money earner.
But in an even more in-depth fashion.
Pancoast described the energy division being at the centre of an intersection with multiple divergent thru-roads. Those include being caught in the middle of political whims, market forces, municipal expectations, legislation, environmental regulations and reclamation obligations.
The last item appears to be a bit of a mystery when it comes to what exactly the potential costs are associated for a municipality which has been in the business of gas drilling and distribution for well over a century.
Coun. Darren Hirsch dropped a clue to what it might be during an earlier discussion on the future of the municipal rainy-day fund.
“Our abandonment costs are high and well past $75 million,” said Hirsch of the plan to restructure the Heritage Reserve Fund, dedicating that initial dollar amount to reclamation.
The briefing note prepared for councillors reveals little more on that figure, only stating, “given that the obligation is much greater than this, the new reserve will require regular funding each year.”
One of the three wind turbines which the city is involved in a public, private partnership with WindRiver Power. The company is currently in the middle of a 20-year power purchase agreement with the municipality. (File photo)
Another $75 million of the Heritage Reserve Fund would be earmarked for an energy transition reserve. The remaining $79 million of the $229 million currently in the fund would remain as unrestricted cash in a renamed endowment fund.
Hirsch defended the proposal, stating, “we’re not gaining money, we’re not losing money and this is not – by any account – a shell game.”
The earlier discussion as to the future of the municipal fund also dovetailed into Pancoast’s later presentation on the energy division’s strategy.
Specifically, when it comes to energy transition.
Pancoast outlined energy transition strategies such as the city’s Clear Horizon project that would capture and store carbon emissions as well as the municipality’s forays into hydrogen production.
But she also stressed the opportunity available with the Saamis Solar project to mitigate risk in a volatile energy production environment while also being realistic as to its limitations.
As for the total costs associated with the solar project and its full buildout, Pancoast didn’t say aside from it not being $600 million.
She did reiterate the city is currently only in the process of buying the rights to the 325 MW project with an initial regulatory application to develop 75 MW. Pancoast refrained from divulging costs associated with either stage but said more information will be presented to councillors next month.
As for the detailed outline of the strategy for the city’s energy division, Pancoast summarized there were financial bumps in the road coming but there are entrepreneurial opportunities as well.
Hirsch asked Pancoast what political risks are out there. Specifically, in response to comments he’s received about just waiting a little longer to see the results of the next election and likely new government before embarking on a carbon reduction strategy.
Pancoast outlined some of the differences between the federally mandated retail carbon tax and the provincial one for large carbon dioxide emitters.
The city’s energy division falls under Alberta’s carbon tax which pays into the Technology Innovation and Emissions Reduction (TIER) fund through a price-per-tonne of carbon. In the period since that carbon tax was introduced by Premier Ed Stelmach in 2007, federal minimum pricing on large emitters was introduced.
City council Monday Sept. 16, 2024.
As far as whether those federal minimum prices would remain under a new government, Pancoast explained to Hirsch the current view is cloudy – as with all the challenges the energy division is facing.
“We do see a difference between consumer level-type of carbon charges that you pay at the gas pump and on your home heating bill versus what we are seeing at the industrial level,” explained Pancoast. “Interestingly, the federal Conservatives has been silent at the large industrial emitter level. Very vocal at the consumer level but silent at the industrial level. And to me, that’s telling.”
In addition to next month’s revelation of more information on the city’s bid for the Saamis Solar project, the report on the review of the energy division is anticipated to be presented in November.
Councillors tapped the brakes on the recommendation to pass all three readings of the bylaws that would see the restructuring of the $229 million Heritage Reserve Fund. Councillors Shila Sharps, Ramona Robins, Alison Van Dyke and Mayor Linnsie Clark voted against the motion for third reading. Clark stated she would like to ensure language reflects council is the determining body in how the funds are utilized and Robins saying she’d like to reflect more on the information provided.