Alberta’s Aggressive Renewable Energy Push
One Canadian province has set its sights on generating almost a third of its electricity from renewable sources by 2030. This will take some US$7.77 billion (C$10 billion) in investments by that year to add 5 GW of renewable capacity, creating more than 7,000 jobs.
The province is Alberta—the center of Canada’s oil industry.
Alberta has been aggressively pursuing renewable energy, switching power plants from coal to gas, and last December, organizing its first renewable power bidding round, which ended with commitments from three energy companies to develop four wind power projects that will add a combined 600 MW to the province’s renewable capacity.
Now, the government is preparing another two bidding rounds, to take place later this year, and it is raising the local carbon tax to fight emissions.
As of January 1 this year, Alberta’s carbon tax has jumped to US$23.30 (C$30) per metric ton. That’s a 50-percent increase although it’s still lower than the carbon tax that will enter into force in neighbor British Columbia from April 1, at US$27 (C$35) per ton.
An urge to go green is not the only reason for the steep tax increase, however. It is expected to help the government’s efforts to balance its books.
In the current fiscal year, Alberta’s Finance Ministry has projected a deficit of US$6.8 billion (C$8.8 billion). This is a decline on last year’s figure and the deficit should continue to decline over the next four years until the province returns to a surplus, albeit moderate, in fiscal 2023-24. The carbon tax will contribute to the deficit shrinkage but it won’t be even close to enough for Alberta to swing into the black.
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