Alberta Off Coal AgreementHungcp
When the government changed, many people – probably Prime Minister Jason Kenney too – thought that the abandonment of coal would be cancelled. Instead, the industry had very little appetite to abandon its coal offset agreements, while it was still facing falling natural gas prices, carbon prices and federal coal abandonment schemes. The overlapping offsets and policies and poor market conditions have provided a strong defence against the resurgence of coal. There have been costs for the abandonment of coal. Transitional payments to coal-fired power plant owners may seem large, but they amount to about one-fifth of a cent per kilowatt hour. Abandoning coal is not just about reducing greenhouse gases. It also reduces air pollutants such as sulphur dioxide, nitrogen oxides, fine particulate matter, ozone, cadmium, mercury and lead. These can lead to serious respiratory and heart disease. No no.
Alberta`s electricity market is relatively isolated and we do not have the capacity to import enough electricity to offset the decline in coal production. Electricity imports have increased since 2016, but still account for only five per cent of Alberta`s total supply. The market is responding to the abandonment of coal and projects such as the recent Cascades natural gas plant, the transformation of several coal-fired plants into natural gas, Suncors` (now delayed) cogeneration expansion, and significant wind and solar production indicate that Alberta will continue to be well served by reasonable prices in the years to come. Coal collapsed in Alberta. Once the backbone of the province`s electricity system, coal now provides about a quarter of Alberta`s electricity. Under the current NDP plan, electricity generated from coal is expected to be completely shut down by 2030. This means that 12 of Alberta`s 18 coal-fired power plants, which together produce half of Alberta`s electricity, will be closed over the next 10 years. End-of-life dates for the remaining six range from 2036 to 2061. The abandonment of Alberta coal is a success story in terms of climate protection. The mine employs about 100 people, while the coal-fired power plant, jointly operated by ATCO and Transalta Utilities, employs an additional 100 people. In the meantime, the UCP platform makes no mention of coal abandonment. In other words, unless coal-fired power plants are able to reduce their emissions to 420 tonnes of carbon dioxide per gigawatt hour (gWh), or about as efficient as natural gas.
The only way to do this is to capture and store CO2 (CCS), which requires either an extremely high carbon price or public investment to justify it. The fact that 12 of Alberta`s 18 coal-fired power plants should have been shut down by 2030 under federal regulation by former Prime Minister Stephen Harper is often absent from the conversation. For a typical coal-fired power plant, this policy has increased the average cost of production by about $2 per megawatt-hour. (In context, a typical electricity price in Alberta is about $60 per megawatt hour.) No one really expected that to change Alberta`s behaviour or electrical landscape.