N.B. man without electricity for 13 years

Alberta Electricity Market Reform reshapes policy under the UCP, weighing a capacity market versus energy-only design, AESO reliability rules, renewables targets, coal phase-out, carbon pricing, consumer rates, and investment certainty before AUC decisions.

Key Points

Alberta Electricity Market Reform is the UCP plan to reassess capacity vs energy-only, renewables, and carbon pricing.

✅ Reviews capacity market timeline and AESO procurement

✅ Alters subsidies for renewables; slows wind and solar growth

✅ Adjusts industrial carbon levy; audits Balancing Pool losses

Hearings kicked off this week into the future of the province’s electricity market design, amid an electricity market reshuffle pledged by the province, but a high-stakes decision about the industry’s fate — affecting billions of dollars in investment and consumer costs — won’t be made inside the meeting room of the Alberta Utilities Commission.

Instead, it will take place in the office of Jason Kenney, as the incoming premier prepares to pivot away from the seismic reforms to Alberta’s electricity sector introduced by the Notley government.

The United Conservative Party has promised to adopt market-based policies, reflecting changes to how Alberta produces and pays for power, that will reset how the sector operates, from its approach to renewable energy and carbon pricing to re-evaluating the planned transition to an electricity “capacity market.”

“Every ball in electricity is up in the air right now,” Vittoria Bellissimo, of the Industrial Power Consumers Association of Alberta, said Tuesday during a break in the commission hearings.

Industry players are uncertain how quickly the UCP will change direction on power policies, but there’s little doubt Kenney’s government will take a strikingly different approach to the sector that keeps the lights on in Alberta.

“There’s some things they are going to change that are going to impact the electricity industry significantly,” said Duane Reid-Carlson, chief executive of consultancy EDC Associates.

“But I don’t think it’s going to be upheaval. I think the new government will proceed with caution because electricity is the foundation of our economy.”

Alberta’s electricity market has been turned on its head in recent years due to the recession, power prices dropping to near two-decade lows and several transformative policies initiated by the NDP.

The Notley government’s climate plan included an accelerated phase-out of all coal-fired generation and set targets for more renewable energy.

The most significant, but least-understood, move has been the planned shift to an electricity capacity market in 2021.

Under the strategy, generators will no longer solely be paid for the power produced and sold into the market; they will also receive payments for having electricity capacity available to the grid on demand.

The change was recommended by the Alberta Electric System Operator (AESO) as a way to reduce price volatility and provide more reliability than the current energy-only market, which some argue needs more competition to deliver better outcomes.

The independent system operator and industry officials have spent more than two years planning the transition since the switch was announced in late 2016. Proposed rules for the new system, outlining market changes, are now being discussed at the Alberta Utilities Commission hearings.

However, there is no ironclad guarantee the system remake will go ahead following the UCP’s election victory last week — amid calls to scrap the overhaul from a Calgary retailer — it plans to study the issue further — while other substantive electricity changes are already in store.

The UCP has promised to end “costly subsidies” to renewable energy developments and abandon the NDP’s pledge to have such energy sources make up 30 per cent of all power generation by 2030.

It will remove the planned phase-out of coal-fired electricity generation, although federal regulations for a 2030 prohibition remain in place.

It will also ask the auditor general to conduct a special audit of the massive losses sustained by the province’s Balancing Pool due to power purchase arrangements being handed back to the agency three years ago.

While Kenney has pledged to cancel the provincewide carbon tax, a levy on large industrial greenhouse gas emitters (such has power plants) will still be charged, although at a reduced rate of $20 a tonne.

The biggest unknown remains the power market’s structure, which underpins how the entire system operates.

The UCP has promised to consult on the shift to the capacity market and report back to Albertans within 90 days.

The complex issue may sound like an eye-glazer, but it will have a profound effect on industry investment, as well as how much consumers pay on their monthly electricity bills.

A number of industry players worry the capacity market will lead AESO to procure more power than is necessary, foisting unnecessary costs onto all Albertans.

“I still have concerns for what the impact on consumers is going to be,” said energy market consultant Sheldon Fulton. “I’d love to see the capacity market go away.”

An analysis by EDC Associates found the transition to a capacity market will procure additional electricity before it’s needed, requiring consumers to pay up to 40 per cent more — an extra $1.4 billion — for power in 2021-22 than under the existing market structure.

“I don’t think there’s any prejudged outcome,” said Blake Shaffer, former head trader at TransAlta Corp. and a fellow-in-residence at the C.D. Howe Institute.

“But it really matters about getting this right.”

Evan Bahry, executive director of the Independent Power Producers Society of Alberta, said the fact the UCP’s review was confined to just 90 days is helpful, as it avoids throwing the entire industry into a prolonged period of uncertainty.

As for the greening of Alberta’s power grid, amid growing attention to clean grids and storage, the demise of the NDP’s Renewable Electricity Program will likely slow down the rapid pace of wind and solar development. But it’s unlikely to stop the growth trend as costs continue to fall for such developments.

“Renewables over the last number of years have evolved to the point that they make sense on a subsidy-free basis,” said Dan Balaban, CEO of Greengate Power Corp., which has developed 480 MW of wind power in Alberta and Ontario.

“There is a path to clean electricity ahead.”

Chris Varcoe is a Calgary Herald columnist.

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OPG-TVA SMR Partnership advances advanced nuclear technology and small modular reactors for 24/7 carbon-free baseload power, enabling net-zero goals, cross-border licensing, and deployment within a North American clean energy hub.

Key Points

A cross-border effort by OPG and TVA to develop, license, and deploy SMRs for reliable, carbon-free baseload power.

✅ Coordinates design, licensing, construction, and operations

✅ Supports 24/7 baseload, net-zero targets, and energy security

✅ Leverages Darlington and Clinch River early site permits

Two of North America's leading nuclear utilities unveiled a pioneering partnership to develop advanced nuclear technology as an integral part of a clean energy future and creating a North American energy hub. Ontario Power Generation, whose OPG's SMR commitment is well established, and the Tennessee Valley Authority will jointly work to help develop small modular reactors as an effective long-term source of 24/7 carbon-free energy in both Canada and the U.S.

The agreement allows the companies to coordinate their explorations into the design, licensing, construction and operation of small modular reactors.

"As leaders in our industry and nations, OPG and TVA share a common goal to decarbonize energy generation while maintaining reliability and low-cost service, which our customers expect and deserve," said Jeff Lyash, TVA President and CEO. "Advanced nuclear technology will not only help us meet our net-zero carbon targets but will also advance North American energy security."

"Nuclear energy has long been key to Ontario's clean electricity grid, and is a crucial part of our net-zero future," said Ken Hartwick, OPG President and CEO. "Working together, OPG and TVA will find efficiencies and share best practices for the long-term supply of the economical, carbon-free, reliable electricity our jurisdictions need, supported by ongoing Pickering life extensions across Ontario's fleet."

OPG and TVA have similar histories and missions. Both are based on public power models that developed from renewable hydroelectric generation before adding nuclear to their generation mixes. Today, nuclear generation accounts for significant portions of their carbon-free energy portfolios, with Ontario advancing the Pickering B refurbishment to sustain capacity.

Both are also actively exploring SMR technologies. OPG is moving forward with plans to deploy an SMR at its Darlington nuclear facility in Clarington, ON, as part of broader Darlington SMR plans now underway. The Darlington site is the only location in Canada licensed for new nuclear with a completed and accepted Environmental Assessment. TVA currently holds the only Nuclear Regulatory Commission Early Site Permit in the U.S. for small modular reactor deployment at its Clinch River site near Oak Ridge, TN.

No exchange of funding is involved. However, the collaboration agreement will help OPG and TVA reduce the financial risk that comes from development of innovative technology, as well as future deployment costs.

"TVA has the most recent experience completing a new nuclear plant in North America at Watts Bar and that knowledge is invaluable to us as we work toward the first SMR groundbreaking at Darlington," said Hartwick. "Likewise, because we are a little further along in our construction timing, TVA will gain the advantage of our experience before they start work at Clinch River."

"It's a win-win agreement that benefits all of those served by both OPG and TVA, as well as our nations," said Lyash. "Moving this technology forward is not only a significant step in advancing a clean energy future and Canada's climate goals, but also in creating a North American energy hub."

"With the demand for clean electricity on the rise around the world, Ontario's momentum is growing. The world is watching Ontario as we advance our work to fully unleash our nuclear advantage, alongside a premiers' SMR initiative that underscores provincial collaboration. I congratulate OPG and TVA – two great industry leaders – for working together to deploy SMRs and showcase and apply Canada's nuclear expertise that will deliver economic, health and environmental benefits for all of us to enjoy," said Todd Smith, Ontario Minister of Energy.

"The changing climate is a global crisis that requires global solutions. The partnership between the Tennessee Valley Authority and Ontario Power Generation to develop and deploy advanced nuclear technology is exactly the kind of innovative collaboration that is needed to quickly bring the next generation of nuclear carbon-free generation to market. I applaud the leadership that both companies are demonstrating to further strengthen our cross-border relationships," said Maria Korsnick, President and CEO, Nuclear Energy Institute.

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Atlantic Clean Power Superhighway outlines a federally backed transmission grid upgrade for Atlantic Canada, adding 2,000 MW of renewable energy via interprovincial ties, improved hydro access from Quebec and Newfoundland and Labrador, with utility-regulator funding.

Key Points

A federal-provincial plan upgrading Atlantic Canada's grid to deliver 2,000 MW of renewables via interprovincial links.

✅ $2M technical review to rank priority transmission projects

✅ Target: add 2,000 MW renewable power to Atlantic grid

✅ Cost-sharing by utilities, regulators, and federal-provincial funding

The federal government will spend $2 million on an engineering study to improve the Atlantic region's electricity grid.

The study was announced Friday at a news conference held by 10 federal and provincial politicians at a meeting of the Atlantic Growth Strategy in Halifax, which includes ongoing regulatory reform efforts for cleaner power in Atlantic Canada.

The technical review will identify the most important transmission projects including inter-provincial ties needed to move electricity across the region.

Nova Scotia Premier Stephen McNeil said the results are expected in July.

Provinces will apply to the federal government for federal funding to build the infrastructure. Utilities in each province will be expected to pay some portion of the cost by applying to respective regulators, but what share falls to ratepayers is not known.

​Federal Intergovernmental Affairs Minister Dominic LeBlanc characterized the grid improvements as something that will cost hundreds of millions of dollars.

He said the study was the first step toward "a clean power superhighway across the region.

"We have a historic opportunity to quickly get to work on upgrading ultimately a whole series of transmission links of inter-provincial ties. That's something that the government of Canada would be anxious to work with in terms of collaborating with the provinces on getting that right."

Premier McNeil referred specifically to improving hydro access from Quebec and Newfoundland and Labrador.

For context, a massive cross-border hydropower line to New York is planned, illustrating the scale of projects under consideration.

Goal of 2,000 megawatts

McNeil said the goal was to bring an additional 2,000 megawatts of renewable electricity into the region.

"I can't stress to you enough how critical this will be for the future economic success and stability of Atlantic Canada, especially as Atlantic grids face intensifying storms," he said.

Federal Immigration Minister Ahmed Hussen also announced a pilot project to attract immigrant workers will be extended by two years to the end of 2021.

International graduate students will be given 24 months to apply under the program — a one-year increase.

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Inventoried Energy Program pays ISO-NE generators for fuel security to boost winter reliability, with FERC approval, covering fossil, nuclear, hydropower, and batteries, complementing capacity markets to enhance grid resilience during severe cold snaps.

Key Points

ISO-NE program paying generators to hold fuel or energy reserves for emergencies, boosting winter reliability.

✅ FERC-approved stopgap for 2023 and 2024 winter seasons

✅ Pays for on-site fuel or stored energy during cold-trigger events

✅ Open to fossil, nuclear, hydro, batteries; limited gas participation

Electricity ratepayers in New England will pay tens of millions of dollars to fossil fuel and nuclear power plants later this decade under a program that proponents say is needed to keep the lights on during severe winters but which critics call a subsidy with little benefit to consumers or the grid, even as Connecticut is pushing a market overhaul across the region.

Last week the Federal Energy Regulatory Commission said ISO-New England, which runs the six-state power grid, can create what it calls the Inventoried Energy Program or IEP. This basically will pay certain power plants to stockpile of fuel for use in emergencies during two upcoming winters as longer-term solutions are developed.

The federal commission called it a reasonable short-term solution to avoid brownouts which doesn’t favor any given technology.

Not all agree, however, including FERC Commissioner Richard Glick, who wrote a fiery dissent to the other three commissioners.

“The program will hand out tens of millions of dollars to nuclear, coal and hydropower generators without any indication that those payments will cause the slightest change in those generators’ behavior,” Glick wrote. “Handing out money for nothing is a windfall, not a just and reasonable rate.”

The program is the latest reaction by ISO-NE to the winter of 2013-14 when New England almost saw brownouts because of a shortage of natural gas to create electricity during a pair of week-long deep freezes.

ISO-New England says the situation is more critical now because of the possible retirement of the gas-fired Mystic Generating Station in Massachusetts. As with closed nuclear plants such as Vermont Yankee and Pilgrim in Massachusetts, power plant owners say lower electricity prices, partly due to cheap renewables and partly to stagnant demand, means they can’t be profitable just by selling power.

Programs like the IEP are meant to subsidize such plants – “incentivize” is the industry term – even though some argue there is no need to subsidize nuclear in deregulated markets so they’ll stay open if they are needed.

The IEP approved last week will be applied to the winters of 2023 and 2024, after a different subsidy program expires. It sets prices, despite warnings about rushing pricing changes from industry groups, for stocking certain amounts of fuel and payments during any “trigger” event, defined as a day when the average of high and low temperatures at Bradley International Airport in Connecticut is no more than 17 degrees Fahrenheit.

These payments will be made on top of a complex system of grid auctions used to decide how much various plants get paid for generating electricity at which times.

ISO-NE estimates the new program will cost between $102 million and $148 million each winter, depending on weather and market conditions.

It says the payments are open to plants that burn oil, coal, nuclear fuel, wood chips or trash; utility-scale battery storage facilities; and hydropower dams “that store water in a pond or reservoir.” Natural gas plants can participate if they guarantee to have fuel available, but that seems less likely because of winter heating contracts.

A major complaint and groups that filed petitions opposing the project is that ISO-NE presented little supporting evidence of how prices, amount and overall cost were determined. ISO-NE argued that there wasn’t time for such analysis before the Mystic shutdown, and FERC agreed.

“The proposal is a step in the right direction … while ISO-NE finishes developing a long-term market solution,” the commission said in its ruling.

The program is the latest example of complexities facing the nation’s electricity system evolves in the face of solar and wind power, which produce electricity so cheaply that they can render traditional power uneconomic but which can’t always produce power on demand, prompting discussions of Texas grid improvements among policymakers. Another major factor is climate change, which has increased the pressure to support renewable alternatives to plants that burn fossil fuels, as well as stagnant electricity demand caused by increased efficiency.

Opponents, including many environmental groups, say electricity utilities and regulators are too quick to prop up existing systems, as the 145-mile Maine transmission line debate shows, built when electricity was sent one way from a few big plants to many customers. They argue that to combat climate change as well as limit cost, the emphasis must be on developing “non-wire alternatives” such as smart systems for controlling demand, in order to take advantage of the current system in which electricity goes two ways, such as from rooftop solar back into the grid.

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Germany EV Subsidy Cut triggers budget-crisis fallout in the automotive industry, after a constitutional court ruling; EV incentives end, threatening electromobility adoption, manufacturer competitiveness, 2030 targets, and demand amid Chinese competition and weak global growth.

Key Points

A sudden end to Germany's EV incentives due to a budget shortfall after a court ruling, hurting automakers and adoption.

✅ Ends buyer rebates amid budget crisis ruling

✅ Risks 2030 EV targets and industry competitiveness

✅ Weak demand and China competition intensify

The German government has faced a backlash after abruptly ending an electric car subsidy scheme in a blow to the already struggling automotive industry.

The scheme is one of the casualties of a budget crisis caused by a shock constitutional court ruling in November that upended the government's spending plans.

The economy ministry said Saturday that Sunday would be the last day prospective buyers could apply for the scheme, which paid out thousands of euros per customer to partially cover the cost of buying an electric car today.

A spokesman for the ministry admitted it was an "unfortunate situation" for consumers who had been hoping to take advantage of the subsidy, but it had no choice "because there is no longer enough money available."

Analyst Ferdinand Dudenhoeffer from the Center for Automotive Research warned the decision could have dramatic consequences amid a Europe EV slump already pressuring demand.

"The competitiveness of [auto] manufacturers will now be severely damaged," Dudenhoeffer told the Rheinische Post newspaper.

The Handelsblatt business daily had already warned that scrapping the scheme risked jeopardizing Germany's plans to get 15 million electric cars on the road by 2030, even though the EU EV share grew during lockdowns earlier in the pandemic.

"This goal was already considered extremely unrealistic. Now it seems completely illusory," it wrote.

In the UK, analysts warn that electric cars could cost more if a post-Brexit deal is not reached, underscoring wider market uncertainties.

A total of around 10 billion euros ($1.1 billion) has been paid out since 2016 under the scheme for around 2.1 million electric vehicles, according to the economy ministry.

Germany's flagship automotive industry, including Volkswagen, has been struggling with the transition to electromobility due to a weak global economy and low levels of demand.

In addition, it is facing a serious challenge from homegrown rivals in China, one of its most important markets, as France moves to discourage Chinese EVs with new rules.

"The Chinese are massively expanding their car industry because they have customers. Our manufacturers no longer have any," Dudenhoeffer said, as France's incentive rules make the market tougher for Chinese brands.

Germany's highest court decided last month that the government had broken a constitutional debt rule when it transferred 60 billion euros earmarked for pandemic support to a climate fund.

The bombshell ruling blew a huge hole in spending plans and plunged Chancellor Olaf Scholz's three-way coalition into turmoil.

After adopting an emergency budget for 2023, Scholz and his junior coalition partners battled for weeks before finally finding an agreement for 2024.

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UK Nuclear Free Electricity Incentive proposes community benefits near reactors, echoing France, supporting net zero goals, energy security, and streamlined planning, while addressing regulation and judicial review challenges for Sizewell C and future nuclear projects.

Key Points

A proposed policy to give free power to residents near reactors, supporting net zero and energy security.

✅ Free power for communities near nuclear plants

✅ Aligns with net zero and energy security goals

✅ Seeks streamlined planning and fewer approvals

UK Business Secretary Jacob Rees-Mogg has endorsed a French-style nuclear system that sees people living near nuclear power stations receive free electricity.

Speaking at an event organised by Policy Exchange think tank, Jacob Rees-Mogg said: “Nuclear power is just fundamental. There’s no way we can get to net zero emissions, or even have an intelligent electricity strategy and grid reform in the UK, without nuclear.”

Highlighting that this was his view and not a government policy announcement, he said: “We should copy the French. As I understand, if you live near a nuclear power station in France, you get free electricity and that’s great because then, I’ll have two in my garden if I get free electricity for my children as well.

“I think you want to recognise that things you do that are in the national interest, such as a state-owned generation company, must benefit those who make the sacrifice for the national interest.”

Earlier Mr Rees-Mogg stressed that he would like to see a simpler development consent process for new nuclear power plants to enable the next waves of reactors in the UK, amid concerns that Europe is losing nuclear power just when it really needs energy.

He said: “That’s a lot of regulation around that, as seen when nuclear plant plans collapsed in Wales and impacted the local economy. Did you know that Sizewell C will require 140 individual approvals from arms of the state, each one of which is potentially subject to judicial review.”

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