Pacific Gas and Electric Company PG&E recently announced that it has paid a $300 million fine levied by the California Public Utilities Commission CPUC in association with the 2010 natural gas transmission pipeline explosion in San Bruno, California.
When the CPUC announced its decision on April 9, PG&E chose to move forward without an appeal. The payment to the state's General Fund is due Oct. 6. The company recently completed the sale of additional stock necessary to fund the payment.
"We want our customers and their families to know that all of us at PG&E have committed ourselves to a goal of transforming this company into the safest and most reliable energy provider in America. We've made tremendous progress, but we have more to do and we are committed to doing it right," PG&E Corporation Chairman and CEO Tony Earley said.
In addition to the $300 million fine to be paid to the state, the CPUC penalty requires that PG&E shareholders refund $400 million to gas customers and pay $850 million for gas system safety improvements.
The $400 million refund, which will be based on usage, will be returned to customers in early 2016 per the CPUCÂ’s direction.
In addition to the payment to the General Fund, the company has settled claims amounting to more than $500 million with all of the victims and families of the San Bruno accident, established a $50 million trust for the City of San Bruno for costs related to recovery and contributed $70 million to support the city's and community's recovery efforts.
As a result of the concrete actions the company has taken to make safety the cornerstone of its culture following the San Bruno explosion, PG&E became one of the first utilities ever to earn two of the highest internationally recognized safety certifications—the International Organization for Standardization ISO 55001 and Publicly Available Specification PAS 55-1. The company has taken additional actions including the following:
- Change began at the top with Tony Earley joining the company as CEO in 2011. We restructured our gas operations business and hired the best natural gas experts in the country to run it.
- We put 3,500 leaders at all levels of PG&E through safety training and we review the lessons of San Bruno with every new employee.
- We have conducted advanced pipeline safety testing, replaced pipe where necessary and installed more than 200 new automated or remotely controlled emergency shut-off valves.
- We decommissioned more than 800 miles of remaining cast-iron pipe in our system, replacing with stronger, more efficient and seismically sound pipe.
- We built a new gas operations control center, employing the most advanced technology, from which we can monitor the entire system and respond more quickly and effectively to emergencies.
- We're using new gas leak detection technology that is 1,000 times more sensitive than traditional equipment in order to help find and fix leaks before they become a problem. When a customer calls to report a gas odor, we are now among the fastest in the entire industry in responding.
- We have closed out 10 of 12 recommendations from the National Transportation Safety Board and work on the remaining two is on track.
AI Energy Consumption strains corporate electricity bills as data centers and HPC workloads run nonstop, driving carbon emissions. Efficiency upgrades, renewable energy, and algorithm optimization help control costs and enhance sustainability across industries.
Key Points
AI Energy Consumption is the power used by AI compute and data centers, impacting costs and sustainability.
✅ Optimize cooling, hardware, and workloads to cut kWh per inference
✅ Integrate on-site solar, wind, or PPAs to offset data center power
✅ Tune models and algorithms to reduce compute and latency
Artificial Intelligence (AI) is revolutionizing industries with its promise of increased efficiency and productivity. However, as businesses integrate AI technologies into their operations, there's a significant and often overlooked impact: the strain on corporate electricity bills.
AI's Growing Energy Demand
The adoption of AI entails the deployment of high-performance computing systems, data centers, and sophisticated algorithms that require substantial energy consumption. These systems operate around the clock, processing massive amounts of data and performing complex computations, and, much like the impact on utilities seen with major EV rollouts, contributing to a notable increase in electricity usage for businesses.
Industries Affected
Various sectors, including finance, healthcare, manufacturing, and technology, rely on AI-driven applications for tasks ranging from data analysis and predictive modeling to customer service automation and supply chain optimization, while manufacturing is influenced by ongoing electric motor market growth that increases electrified processes.
Cost Implications
The rise in electricity consumption due to AI deployments translates into higher operational costs for businesses. Corporate entities must budget accordingly for increased electricity bills, which can impact profit margins and financial planning, especially in regions experiencing electricity price volatility in Europe amid market reforms. Managing these costs effectively becomes crucial to maintaining competitiveness and sustainability in the marketplace.
Sustainability Challenges
The environmental impact of heightened electricity consumption cannot be overlooked. Increased energy demand from AI technologies contributes to carbon emissions and environmental footprints, alongside rising e-mobility demand forecasts that pressure grids, posing challenges for businesses striving to meet sustainability goals and regulatory requirements.
Mitigation Strategies
To address the escalating electricity bills associated with AI, businesses are exploring various mitigation strategies:
Energy Efficiency Measures: Implementing energy-efficient practices, such as optimizing data center cooling systems, upgrading to energy-efficient hardware, and adopting smart energy management solutions, can help reduce electricity consumption.
Renewable Energy Integration: Investing in renewable energy sources like solar or wind power and energy storage solutions to enhance flexibility can offset electricity costs and align with corporate sustainability initiatives.
Algorithm Optimization: Fine-tuning AI algorithms to improve computational efficiency and reduce processing times can lower energy demands without compromising performance.
Cost-Benefit Analysis: Conducting thorough cost-benefit analyses of AI deployments to assess energy consumption against operational benefits and potential rate impacts, informed by cases where EV adoption can benefit customers in broader electricity markets, helps businesses make informed decisions and prioritize energy-saving initiatives.
Future Outlook
As AI continues to evolve and permeate more aspects of business operations, the demand for electricity will likely intensify and may coincide with broader EV demand projections that increase grid loads. Balancing the benefits of AI-driven innovation with the challenges of increased energy consumption requires proactive energy management strategies and investments in sustainable technologies.
Conclusion
The integration of AI technologies presents significant opportunities for businesses to enhance productivity and competitiveness. However, the corresponding surge in electricity bills underscores the importance of proactive energy management and sustainability practices. By adopting energy-efficient measures, leveraging renewable energy sources, and optimizing AI deployments, businesses can mitigate cost impacts, reduce environmental footprints, and foster long-term operational resilience in an increasingly AI-driven economy.
COVID-19 Impact on U.S. Electricity Consumption shows commercial and industrial demand dropped as residential use rose, with flattened peak loads, weekday-weekend convergence, Texas hourly data, and energy demand as a real-time economic indicator.
Key Points
It reduced commercial and industrial demand while raising residential use, shifting peaks and weekday patterns.
✅ Commercial electricity down 12%; industrial down 14% in Q2 2020
✅ Residential use up 10% amid work-from-home and lockdowns
✅ Peaks flattened; weekday-weekend loads converged in Texas
This is an important turning point for the United States. We have a long road ahead. But one of the reasons I’m optimistic about Biden-Harris is that we will once again have an administration that believes in science.
To embrace this return to science, I want to write today about a fascinating new working paper by Tufts economist Steve Cicala.
Professor Cicala has been studying the effect of Covid on electricity consumption since back in March, when the Wall Street Journal picked up his work documenting an 18% decrease in electricity consumption in Italy.
The new work, focused on the United States, is particularly compelling because it uses data that allows him to distinguish between residential, commercial, and industrial sectors, against a backdrop of declining U.S. electricity sales over recent years.
Fact #1: Firms Are Using Less U.S. commercial electricity consumption fell 12% during the second quarter of 2020. U.S. industrial electricity consumption fell 14% over the same period.
This makes sense. The second quarter was by some measures, the worst quarter for the U.S. economy in over 145 years!
Economic activity shrank. Schools closed. Offices closed. Factories closed. Restaurants closed. Malls closed. Even health care offices closed as patients delayed going to the dentist and other routine care. All this means less heating and cooling, less lighting, less refrigeration, less power for computers and other office equipment, less everything.
The decrease in the industrial sector is a little more surprising. My impression had been that the industrial sector had not fallen as far as commercial, but amid broader disruptions in coal and nuclear power that strained parts of the energy economy, the patterns for both sectors are quite similar with the decline peaking in May and then partially rebounding by July. The paper also shows that areas with higher unemployment rates experienced larger declines in both sectors.
Fact #2: Households Are Using More While firms are using less, households are using more. U.S. residential electricity consumption increased 10% during the second quarter of 2020. Consumption surged during March, April, and May, a reflection of the lockdown lifestyle many adopted, and then leveled off in June and July – with much less of the rebound observed on the commercial/industrial side.
This pattern makes sense, too. In Professor Cicala’s words, “people are spending an inordinate amount of time at home”. Many of us switched over to working from home almost immediately, and haven’t looked back. This means more air conditioning, more running the dishwasher, more CNN (especially last week), more Zoom, and so on.
The paper also examines the correlates of the decline. Areas in the U.S. where more people can work from home experienced larger increases. Unemployment rates, however, are almost completely uncorrelated with the increase.
Fact #3: Firms are Less Peaky The paper next turns to a novel dataset from Texas, where Texas grid reliability is under active discussion, that makes it possible to measure hourly electricity consumption by sector.
As the figure above illustrates, the biggest declines in commercial/industrial electricity consumption have occurred Monday through Friday between 9AM and 5PM.
The dashed line shows the pattern during 2019. Notice the large spikes in electricity consumption during business hours. The solid line shows the pattern during 2020. Much smaller spikes during business hours.
Fact #4: Everyday is Like Sunday Finally, we have what I would like to nominate as the “Energy Figure of the Year”.
Again, start with the pattern for 2019, reflected by the dashed line. Prior to Covid, Texas households used a lot more electricity on Saturdays and Sundays.
Then along comes Covid, and turned every day into the weekend. Residential electricity consumption in Texas during business hours Monday-Friday is up 16%(!).
In the pattern for 2020, it isn’t easy to distinguish weekends from weekdays. If you feel like weekdays and weekends are becoming a big blur – you are not alone.
Conclusion Researchers are increasingly thinking about electricity consumption as a real-time indicator of economic activity, even as flat electricity demand complicates utility planning and investment. This is an intriguing idea, but Professor Cicala’s new paper shows that it is important to look sector-by-sector.
While commercial and industrial consumption indeed seem to measure the strength of an economy, residential consumption has been sharply countercylical – increasing exactly when people are not at work and not at school.
These large changes in behavior are specific to the pandemic. Still, with the increased blurring of home and non-home activities we may look back on 2020 as a key turning point in how we think about these three sectors of the economy.
More broadly, Professor Cicala’s paper highlights the value of social science research. We need facts, data, and yes, science, if we are to understand the economy and craft effective policies on energy insecurity and shut-offs as well.
PG&E COVID-19 Shutoff Moratorium suspends service disconnections, offers flexible payment plans, and expands customer support with safety protocols, social distancing, and public health guidance for residential and commercial utility customers during the pandemic.
Key Points
A temporary halt to utility shutoffs with flexible payment plans to support PG&E customers during COVID-19.
✅ Suspends shutoffs for residential and commercial accounts
✅ Offers most flexible payment plans upon COVID-19 hardship
✅ Enhances safety: social distancing, PPE, remote work protocols
Pacific Gas and Electric Company has announced that due to the COVID-19 pandemic, it has voluntarily implemented a moratorium on service disconnections for non-payment, effective immediately. This suspension, similar to policies in New Jersey and New York, will apply to both residential and commercial customers and will remain in effect until further notice. To further support customers who may be impacted by the pandemic, PG&E will offer its most flexible pay plans to customers who indicate either an impact or hardship as a result of COVID-19. PG&E will continue to monitor current events and identify opportunities to support our customers and communities through concrete actions.
In addition to the moratorium on service shut-offs, PG&E’s response to the COVID-19 pandemic is focused on efforts to protect the health and safety of its customers, employees, contractors and the communities it serves, including ongoing wildfire risk reduction efforts that continue alongside its pandemic response. Actions the company has taken include providing guidance for employees who have direct customer contact to take social distancing precautionary measures, such as avoiding handshakes and wearing disposable nitrile gloves while in customers' homes, and continuing safety work related to power line-related fires across its service area.
Customers who visit local offices to pay bills and are sick or experiencing symptoms are being asked to use other payment options such as online or by phone, as seen when Texas utilities waived fees during the pandemic, at 1-877-704-8470.
“We recognize that this is a rapidly changing situation and an uncertain time for many of our customers. Our most important responsibility is the health and safety of our customers and employees. We also want to provide some relief from the stress and financial challenges many are facing during this worldwide, public health crisis, and with rates set to stabilize in 2025 the company remains focused on affordability. We understand that many of our customers may experience a personal financial strain due to the slowdown in the economy related to the pandemic, and programs like the Wildfire Assistance Program can help eligible customers,” said Chief Customer Officer and Senior Vice President Laurie Giammona.
Internally, the company is taking advanced cleaning measures, communicating best practices frequently with employees, and is asking its leaders to let employees work remotely if their job allows, while avoiding critical business disruption. PG&E has activated an enterprise-wide incident response team and is vigilantly monitoring the Centers for Disease Control and Prevention and World Health Organization for updates related to the virus. The company is committed to continue addressing customer service needs and does not expect any disruption in gas or electric service due to the public health crisis.
European Power Crisis intensifies as record electricity prices, nuclear output cuts, gas supply strain, heatwave drought, and Rhine shipping bottlenecks hit Germany, France, and Switzerland, tightening winter storage and driving long-term contracts higher.
Key Points
A surge in European power prices from heatwaves, nuclear curbs, Rhine coal limits, and reduced Russian gas supply.
✅ Record year-ahead prices in Germany and France
✅ Nuclear output curbed by warm river cooling limits
✅ Rhine low water disrupts coal logistics and generation
Benchmark power prices in Europe hit fresh records Friday as utilities are increasingly reducing electricity output in western Europe because of the hot weather.
Next-year contracts in Germany and France, Europe’s biggest economies rose to new highs after Switzerland’s Axpo Holding AG announced curbs at one of its nuclear plants. Electricite de France SA is also reducing nuclear output because of high river temperatures and cooling water restrictions, while Uniper SE in Germany is struggling to get enough coal up the river Rhine.
Europe is suffering its worst energy crunch in decades, and losing nuclear power is compounding the strain as gas cuts made by Russia in retaliation for sanctions drive a surge in prices. The extreme heat led to the driest July on record in France and is underscoring the impact that a warming climate is having on vital infrastructure.
Water levels on Germany’s Rhine have fallen so low that the river may effectively close soon, impacting supplies of coal to the plants next to it. The Rhone and Garonne in France and the Aare in Switzerland are all too warm to be used to cool nuclear plants effectively, forcing operators to limit energy output under environmental constraints.
Northwest European weather forecast for the next two weeks: relates to European Power Hits Records as Plants Start to Buckle in Heat
The German year-ahead contract gained as much as 2% to 413 euros a megawatt-hour on the European Energy Exchange AG. The French equivalent rose 1.9% to a record 535 euros. Long-term prices are coming under pressure because producing less power from nuclear and coal will increase the demand for natural gas, which is badly needed to fill storage sites ahead of the winter.
France to Curb Nuclear Output as Europe’s Energy Crisis Worsens Uniper SE said on Thursday that two of its coal-fired stations along the Rhine may need to curb output during the next few weeks as transporting coal along the Rhine becomes impossible.
Plants on the river near Mannheim and Karlsruhe, operated by Grosskraftwerk Mannheim AG and EnBW AG, have previously struggled to source coal because of the shallow water, even as German renewables deliver more electricity than coal and nuclear at times. Both companies said generation hasn’t been affected yet.
“The low tide is not currently affecting our generation of energy because our plants do not have the need for continuous fresh water,” a Steag GmbH spokesman said on Friday. “But the low tide level can make running plants and transporting coal more complicated than usual.”
The spokesman said though that there is slight reduction in output of about 10 to 15 megawatts, which would equate to a few percent, because of the hot temperatures. “This has been happening over some time now and is a problem for everyone because the plant system is not designed to withstand such hot temperatures,” he said.
ITER Nuclear Fusion advances tokamak magnetic confinement, heating deuterium-tritium plasma with superconducting magnets, targeting net energy gain, tritium breeding, and steam-turbine power, while complementing laser inertial confinement milestones for grid-scale electricity and 2025 startup goals.
Key Points
ITER Nuclear Fusion is a tokamak project confining D-T plasma with magnets to achieve net energy gain and clean power.
✅ Tokamak magnetic confinement with high-temp superconducting coils
✅ Deuterium-tritium fuel cycle with on-site tritium breeding
✅ Targets net energy gain and grid-scale, low-carbon electricity
It sounds like the stuff of dreams: a virtually limitless source of energy that doesn’t produce greenhouse gases or radioactive waste. That’s the promise of nuclear fusion, often described as the holy grail of clean energy by proponents, which for decades has been nothing more than a fantasy due to insurmountable technical challenges. But things are heating up in what has turned into a race to create what amounts to an artificial sun here on Earth, one that can provide power for our kettles, cars and light bulbs.
Today’s nuclear power plants create electricity through nuclear fission, in which atoms are split, with next-gen nuclear power exploring smaller, cheaper, safer designs that remain distinct from fusion. Nuclear fusion however, involves combining atomic nuclei to release energy. It’s the same reaction that’s taking place at the Sun’s core. But overcoming the natural repulsion between atomic nuclei and maintaining the right conditions for fusion to occur isn’t straightforward. And doing so in a way that produces more energy than the reaction consumes has been beyond the grasp of the finest minds in physics for decades.
But perhaps not for much longer. Some major technical challenges have been overcome in the past few years and governments around the world have been pouring money into fusion power research as part of a broader green industrial revolution under way in several regions. There are also over 20 private ventures in the UK, US, Europe, China and Australia vying to be the first to make fusion energy production a reality.
“People are saying, ‘If it really is the ultimate solution, let’s find out whether it works or not,’” says Dr Tim Luce, head of science and operation at the International Thermonuclear Experimental Reactor (ITER), being built in southeast France. ITER is the biggest throw of the fusion dice yet.
Its $22bn (£15.9bn) build cost is being met by the governments of two-thirds of the world’s population, including the EU, the US, China and Russia, at a time when Europe is losing nuclear power and needs energy, and when it’s fired up in 2025 it’ll be the world’s largest fusion reactor. If it works, ITER will transform fusion power from being the stuff of dreams into a viable energy source.
Constructing a nuclear fusion reactor ITER will be a tokamak reactor – thought to be the best hope for fusion power. Inside a tokamak, a gas, often a hydrogen isotope called deuterium, is subjected to intense heat and pressure, forcing electrons out of the atoms. This creates a plasma – a superheated, ionised gas – that has to be contained by intense magnetic fields.
The containment is vital, as no material on Earth could withstand the intense heat (100,000,000°C and above) that the plasma has to reach so that fusion can begin. It’s close to 10 times the heat at the Sun’s core, and temperatures like that are needed in a tokamak because the gravitational pressure within the Sun can’t be recreated.
When atomic nuclei do start to fuse, vast amounts of energy are released. While the experimental reactors currently in operation release that energy as heat, in a fusion reactor power plant, the heat would be used to produce steam that would drive turbines to generate electricity, even as some envision nuclear beyond electricity for industrial heat and fuels.
Tokamaks aren’t the only fusion reactors being tried. Another type of reactor uses lasers to heat and compress a hydrogen fuel to initiate fusion. In August 2021, one such device at the National Ignition Facility, at the Lawrence Livermore National Laboratory in California, generated 1.35 megajoules of energy. This record-breaking figure brings fusion power a step closer to net energy gain, but most hopes are still pinned on tokamak reactors rather than lasers.
In June 2021, China’s Experimental Advanced Superconducting Tokamak (EAST) reactor maintained a plasma for 101 seconds at 120,000,000°C. Before that, the record was 20 seconds. Ultimately, a fusion reactor would need to sustain the plasma indefinitely – or at least for eight-hour ‘pulses’ during periods of peak electricity demand.
A real game-changer for tokamaks has been the magnets used to produce the magnetic field. “We know how to make magnets that generate a very high magnetic field from copper or other kinds of metal, but you would pay a fortune for the electricity. It wouldn’t be a net energy gain from the plant,” says Luce.
One route for nuclear fusion is to use atoms of deuterium and tritium, both isotopes of hydrogen. They fuse under incredible heat and pressure, and the resulting products release energy as heat
The solution is to use high-temperature, superconducting magnets made from superconducting wire, or ‘tape’, that has no electrical resistance. These magnets can create intense magnetic fields and don’t lose energy as heat.
“High temperature superconductivity has been known about for 35 years. But the manufacturing capability to make tape in the lengths that would be required to make a reasonable fusion coil has just recently been developed,” says Luce. One of ITER’s magnets, the central solenoid, will produce a field of 13 tesla – 280,000 times Earth’s magnetic field.
The inner walls of ITER’s vacuum vessel, where the fusion will occur, will be lined with beryllium, a metal that won’t contaminate the plasma much if they touch. At the bottom is the divertor that will keep the temperature inside the reactor under control.
“The heat load on the divertor can be as large as in a rocket nozzle,” says Luce. “Rocket nozzles work because you can get into orbit within minutes and in space it’s really cold.” In a fusion reactor, a divertor would need to withstand this heat indefinitely and at ITER they’ll be testing one made out of tungsten.
Meanwhile, in the US, the National Spherical Torus Experiment – Upgrade (NSTX-U) fusion reactor will be fired up in the autumn of 2022, while efforts in advanced fission such as a mini-reactor design are also progressing. One of its priorities will be to see whether lining the reactor with lithium helps to keep the plasma stable.
Choosing a fuel Instead of just using deuterium as the fusion fuel, ITER will use deuterium mixed with tritium, another hydrogen isotope. The deuterium-tritium blend offers the best chance of getting significantly more power out than is put in. Proponents of fusion power say one reason the technology is safe is that the fuel needs to be constantly fed into the reactor to keep fusion happening, making a runaway reaction impossible.
Deuterium can be extracted from seawater, so there’s a virtually limitless supply of it. But only 20kg of tritium are thought to exist worldwide, so fusion power plants will have to produce it (ITER will develop technology to ‘breed’ tritium). While some radioactive waste will be produced in a fusion plant, it’ll have a lifetime of around 100 years, rather than the thousands of years from fission.
At the time of writing in September, researchers at the Joint European Torus (JET) fusion reactor in Oxfordshire were due to start their deuterium-tritium fusion reactions. “JET will help ITER prepare a choice of machine parameters to optimise the fusion power,” says Dr Joelle Mailloux, one of the scientific programme leaders at JET. These parameters will include finding the best combination of deuterium and tritium, and establishing how the current is increased in the magnets before fusion starts.
The groundwork laid down at JET should accelerate ITER’s efforts to accomplish net energy gain. ITER will produce ‘first plasma’ in December 2025 and be cranked up to full power over the following decade. Its plasma temperature will reach 150,000,000°C and its target is to produce 500 megawatts of fusion power for every 50 megawatts of input heating power.
“If ITER is successful, it’ll eliminate most, if not all, doubts about the science and liberate money for technology development,” says Luce. That technology development will be demonstration fusion power plants that actually produce electricity, where advanced reactors can build on decades of expertise. “ITER is opening the door and saying, yeah, this works – the science is there.”
Canada Wind Energy Costs are plunging as renewable energy auctions, CfD contracts, and efficient turbines drive prices to 2-4 cents/kWh across Alberta and Saskatchewan, outcompeting grid power via competitive bidding and improved capacity factors.
Key Points
Averaging 2-4 cents/kWh via auctions, CfD support, and bigger turbines, wind is now cost-competitive across Canada.
✅ Alberta CfD bids as low as 3.9 cents/kWh.
✅ Turbine outputs rose from 1 MW to 3.3 MW per tower.
✅ Competitive auctions cut costs ~70% over nine years.
It's taken a decade of technological improvement and a new competitive bidding process for electrical generation contracts, but wind may have finally come into its own as one of the cheapest ways to create power.
Ten years ago, Ontario was developing new wind power projects at a cost of 28 cents per kilowatt hour (kWh), the kind of above-market rate that the U.K., Portugal and other countries were offering to try to kick-start development of renewables.
Now some wind companies say they've brought generation costs down to between 2 and 4 cents — something that appeals to provinces that are looking to significantly increase their renewable energy deployment plans.
The cost of electricity varies across Canada, by province and time of day, from an average of 6.5 cents per kWh in Quebec to as much as 15 cents in Halifax.
Capital Power, an Edmonton-based company, recently won a contract for the Whitla 298.8-megawatt (MW) wind project near Medicine Hat, Alta., with a bid of 3.9 cents per kWh, at a time when three new solar facilities in Alberta have been contracted at lower cost than natural gas, underscoring the trend. That price covers capital costs, transmission and connection to the grid, as well as the cost of building the project.
Jerry Bellikka, director of government relations, said Capital Power has been building wind projects for a decade, in the U.S., Alberta, B.C. and other provinces. In that time the price of wind generation equipment has been declining continually, while the efficiency of wind turbines increases.
Increased efficiency
"It used to be one tower was 1 MW; now each turbine generates 3.3 MW. There's more electricity generated per tower than several years ago," he said.
One wild card for Whitla may be steel prices — because of the U.S. and Canada slapping tariffs on one other's steel and aluminum products. Whitla's towers are set to come from Colorado, and many of the smaller components from China.
Canada introduces new surtaxes to curb flood of steel imports
"We haven't yet taken delivery of the steel. It remains to be seen if we are affected by the tariffs." Belikka said.
Another company had owned the site and had several years of meteorological data, including wind speeds at various heights on the site, which is in a part of southern Alberta known for its strong winds.
But the choice of site was also dependent on the municipality, with rural Forty Mile County eager for the development, Belikka said.
Alberta aims for 30% electricity from wind by 2030
Alberta wants 30 per cent of its electricity to come from renewable sources by 2030 and, as an energy powerhouse, is encouraging that with a guaranteed pricing mechanism in what is otherwise a market-bidding process.
While the cost of generating energy for the Alberta Electric System Operator (AESO) fluctuates hourly and can be a lot higher when there is high demand, the winners of the renewable energy contracts are guaranteed their fixed-bid price.
The average pool price of electricity last year in Alberta was 5 cents per kWh; in boom times it rose to closer to 8 cents. But if the price rises that high after the wind farm is operating, the renewable generator won't get it, instead rebating anything over 3.9 cents back to the government.
On the other hand, if the average or pool price is a low 2 cents kWh, the province will top up their return to 3.9 cents.
This contract-for-differences (CfD) payment mechanism has been tested in renewable contracts in the U.K. and other jurisdictions, including some U.S. states, according to AESO.
Competitive bidding in Saskatchewan
In Saskatchewan, the plan is to double its capacity of renewable electricity, to 50 per cent of generation capacity, by 2030, and it uses an open bidding system between the private sector generator and publicly owned SaskPower.
In bidding last year on a renewable contract, 15 renewable power developers submitted bids, with an average price of 4.2 cents per kWh.
One low bidder was Potentia with a proposal for a 200 MW project, which should provide electricity for 90,000 homes in the province, at less than 3 cents kWh, according to Robert Hornung of the Canadian Wind Energy Association.
"The cost of wind energy has fallen 70 per cent in the last nine years," he says. "In the last decade, more wind energy has been built than any other form of electricity."
Ontario remains the leading user of wind with 4,902 MW of wind generation as of December 2017, most of that capacity built under a system that offered an above-market price for renewable power, put in place by the previous Liberal government.
In June of last year, the new Conservative government of Doug Ford halted more than 700 renewable-energy projects, one of them a wind farm that is sitting half-built, even as plans to reintroduce renewable projects continue to advance.
The feed-in tariff system that offered a higher rate to early builders of renewable generation ended in 2016, but early contracts with guaranteed prices could last up to 20 years.
Hornung says Ontario now has an excess of generating capacity, as it went on building when the 2008-9 bust cut market consumption dramatically.
But he insists wind can compete in the open market, offering low prices for generation when Ontario needs new capacity.
"I expect there will be competitive processes put in place. I'm quite confident wind projects will continue to go ahead. We're well positioned to do that."
