Canada dials back clean electricity target date

The government of Canada released its final Clean Electricity Regulations (CER) on December 17, part of a broader clean electricity strategy targeting a net-zero power grid in the country by 2050, 15 years later than its initial ambitions laid out in 2023.

Under the CER, limits will be set starting in 2035 on CO₂ pollution from almost all generating units that use fossil fuels, and allows provinces, territories and municipalities to choose the best emissions reduction solution for their circumstances.

The new regulations are expected to reduce cumulative greenhouse gas emissions from Canada’s electricity sector by nearly 181mn tonnes by 2050. They will apply only to grid-connected generating units – generating units not connected to a grid, cogeneration units or facilities designed to deliver power to data centres, for example, will not be subject to the CER, although they will be subject to Ottawa’s proposed oil and gas emissions cap.

“As electricity system operators and utilities gradually replace older units with cleaner and more efficient units, GHG emissions will decrease,” a government backgrounder says. “By 2050, the regulations will ensure a net-zero electricity system.”

The regulations will impose a technology-neutral “annual emissions limit”, expressed in tonnes of CO₂-equivalent/year and based on each unit’s electricity generating capacity. A unit that produces fewer emissions will be able to operate more than one of the same size that emits more CO₂, while emissions beyond the AEL for a specific unit can be offset, up to a certain amount, using eligible greenhouse gas offset credits.

Most units subject to the CER will fall into one of three categories, depending on when they were commissioned:

• Existing units are those commissioned on or before December 31, 2024. These units will be able to operate for up to 25 years from commissioning before they are subject to an AEL.
• Planned units are those that meet specific criteria by December 31, 2025, are under construction by December 31, 2027 and are commissioned by December 31, 2034. They will not be subject to an AEL until the end of 2049.
• New units are those that do not fall under the ‘Planned’ category and are commissioned on or after January 1, 2025. They will be subject to an AEL beginning in 2035 or on the date they are commissioned, whichever is later.

Steven Guilbeault, Minister of Environment and Climate Change Canada, said the final CER is the result of three years of discussions with provinces and territories, and Alberta Premier Danielle Smith said she was gratified by Ottawa’s recognition that Alberta’s plan to achieve a carbon-neutral power grid by 2050 was a more “responsible, affordable and realistic” target than the federal government’s initial target of 2035.

But, she said in a joint statement with Utilities Minister Nathan Neudorf and Environment Minister Rebecca Schulz, the finalised regulations remain “entirely unconstitutional” as they seek to regulate in an area of exclusive provincial jurisdiction.

And they also require generators to meet “unreasonable and unattainable federally mandated interim targets beginning in 2035” that will make electricity unaffordable for many Canadian families.

“Alberta will therefore be preparing an immediate court challenge of these electricity regulations that we fully expect to win,” the joint statement said. “We would propose a quicker and cheaper alternative solution which involves the federal government completely abandoning any attempt to regulate or otherwise interfere with Alberta’s governance over our provincial power grid.”