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Renewable Energy Projects For Small Communities: Think Aggregation, Not Aggravation

by | Jul 19, 2023 | Community Development

Americans rarely give a second thought to Canada but that changed in June of 2023 – for all the wrong reasons. Canada’s record-breaking wildfires – that have forced more than 155,000 people from their homes this year – sent massive clouds of smoke across the border. In New York City, for example, the pall turned the sky orange and sent the air quality rating into “very unhealthy” territory.

Canada’s wildfires are not the cause of for the record-setting heat waves that broiled parts of the U.S. and put almost 40 million Americans under heat alerts. They are a consequence of it. 

Scientists pointed to several causes, most notably human-induced climate change that fuels heat waves coupled with a particularly ferocious return of the global weather wildcard, El Nino.

The focus on increasingly extreme weather events has spurred talk of how we can help fight climate change in ways that are meaningful, practical, and even beneficial to the economy.

Putting aside those who use climate change as a political wedge issue, most people in North America want their governments to take action on global warming. An Abacus survey of 2,000 Canadians in June indicated almost 70 percent think this year’s wildfires are “definitely” or “most likely” caused by climate change. Likewise, a Pew Research Centre survey of 10,700 Americans in March indicated 66 percent say governments should encourage the production of renewable energy projects such as wind and solar rather than rely on coal or natural gas-burning plants to generate electricity.

Indeed, the US has proven to be fertile soil for wind farms on an industrial scale. The Mojave Wind Farm in California, for example, provides power for 275,000 people. That’s all well and good, you might say, for projects serving vast populations. But what about smaller communities? Can they attract renewable energy projects? If so, are there benefits? The answer is a resounding yes.

Let’s say you’re a councilor in a small rural town who is interested in renewable energy projects, but you don’t pursue the idea because your community lacks the population, money and expertise to make it work. Let me introduce you to “aggregation.” It’s a concept proposed by the Canadian environmental think tank, the Pembina Institute, that involves several smaller neighbouring communities entering into a partnership to pool their resources and their populations. By doing so they could create enough demand to attract a renewable-energy developer to build a project to service the communities. Or they could combine the capability of several smaller projects – or pool funds to build a single larger project – to then sell the power to the commercial grid or to nearby industrial customers.

Pembina surveyed 29 municipalities for a report released in April and discovered 18 thought renewable energy is a potential solution to their climate goals. There are all kinds of practical benefits besides reducing a community’s carbon footprint. At the top of the list: saving money; making money; creating jobs.

According to Pembina, communities “can save money in the long run by securing non-emitting power at set prices under long-term contracts. This is especially true when considering the scheduled carbon tax hikes which will apply to gas-fired power, which still dominates the Alberta power pool.” Renewable energy prices are also not vulnerable to the wild fluctuations of the fossil fuel industry. As for jobs: “For communities who want to have wind or solar plants built in their community, there is also the benefit of some economic activity and a type of energy independence and resiliency.”

Anyone familiar with me will know I am an outspoken advocate of communities working together for the benefit of everyone whether that be sharing resources including expertise, infrastructure, and land. Add to that list, sharing energy projects. “Municipal aggregation is a great way to leverage the strengths of different communities,” said Tristan Walker, energy project lead for the Town and Municipal District of Pincher Creek, in the Pembina report. “Some communities have strengths in expertise, others have access to capital or location and sites, while others have lots of internal capacity.”

Let me point out I am not arguing renewable energy projects – wind, solar and geothermal – are suitable for every community. I am not blind to the challenges of creating these types of projects and of tying them into the transmission grid. And I realize the concept of “aggregation” is more suited to a jurisdiction like the province of Alberta where the electricity system is not controlled by the government but is an open market where private power producers can enter into contracts with transmission companies.

With that in mind, the Alberta town of Innisfail with a population of 8,000 is looking at starting its own solar power project. The community is borrowing $3.5 million but would recoup the money by selling electricity to the provincial grid or to nearby industrial businesses. In fact, the project could generate up to $500,000 a year. That’s a pretty good return on investment. “We did some research with regards to that, and we found there was definitely potential there to make it a viable project that would pay for itself and then be a long-term revenue generator for the town,” said Steven Kennedy, the town’s director of operational services, to the Red Deer Advocate.

The US, for its part, is actively supporting rural initiatives through the federal Rural Energy Pilot Project that, for example, awarded the city of Nenana in Alaska a $600,000 grant in February to support a biomass-fueled district heating system. In June, the US-based National League of Cities issued an article entitled Rural Development Opportunities and the 2023 Farm Bill that looked at the Rural Energy Pilot Project and came to this conclusion: “Not only does expanding rural energy infrastructure provide an essential service and lower energy costs, but by diversifying and expanding energy infrastructure in rural areas, energy independence and resiliency can increase for the whole country. Stimulating business opportunities and economic growth can lead to increased income and an improved quality of life, reducing rural-urban disparities.”

To grow and thrive, communities must take bold steps in new directions, not follow the same old worn-down path. As I have said, renewable energy projects are not suitable for everyone but if you think they might be for your community, take the initiative to explore the possibilities.

But you need not do it alone. My argument has always been that no community can afford to move forward without cooperation and collaboration with its neighbours. Cooperation brings numerous advantages and economies-of-scale. With the growing interest in renewable energy projects, you can add one more advantage to the list.