+ RMA Rural Municipalities
of Alberta

Resolution 20-18F

Decommissioning Costs for Wind Energy Developments

Date:
November 21, 2018
Expiry Date:
December 1, 2021
Active Status:
Active
Sponsors:
MD of Pincher Creek
District:
1 - Foothills-Little Bow
Year:
2018
Convention:
Fall
Category:
Energy
Status:
Sent to Government
Vote Results:
Carried
Preamble:

WHEREAS the Alberta Utilities Commission (AUC) regulates the utilities sector, natural gas and electricity markets to protect social, economic and environmental interests of Alberta where competitive market forces do not; and

WHEREAS the AUC ensures that electric facilities are built, operated and decommissioned in an efficient and environmentally responsible way; and

WHEREAS provincial growth and policy has increased the amount of development of wind power plants and their associated infrastructure; and

WHEREAS wind power plants have a limited life-cycle and will require either decommissioning or repowering at the end of that life cycle; and

WHEREAS if a wind power plant is abandoned during or after its life cycle, the components and associated infrastructure may be abandoned on the landscape, becoming an unsafe and unsightly nuisance, creating a costly cleanup for landowners, and further, the affected municipality; and

WHEREAS pursuant to Section 5(1)(h) of the Hydro and Electric Energy Act, the AUC may make regulations as to the measures to be taken in the construction, operation or abandonment of any power plant for the protection of life, property and wildlife; and

WHEREAS pursuant to Section 5(4) of the Hydro and Electric Energy Act, subject to the approval of the Minister responsible for the Environmental Protection and Enhancement Act, the AUC may make regulations as to the measures to be taken in the abandonment of any power plant for the control of pollution and ensuring environment conservation; and

WHEREAS the AUC falls within the structure of the Ministry of Energy, and the Ministry develops policy for renewable electricity;

Operative Clause:

THEREFORE, BE IT RESOLVED that the Rural Municipalities of Alberta request Alberta Energy to direct the Alberta Utilities Commission to establish a method of ensuring that there is funding in place to ensure that an abandoned wind energy plant is decommissioned and reclaimed in an environmentally responsible way.

Member Background:

The Government of Alberta’s Climate Leadership Plan is helping to provide for further renewable energy developments within the province. Wind power plant developments, in particular, use large amounts of land and the ever-evolving technology is calling for larger and larger equipment being used.

Wind power development has now expanded throughout the province. Municipal councils are charged with the responsibility of providing for the orderly development of land and land uses within the municipality.

A typical wind power plant can easily involve as many as twenty wind turbines, a facility substation, an interconnection transmission line, kilometers of underground cables, and the associated crane pads and access roads.

Alberta was home to the first commercial wind power plant in Canada, the Cowley Ridge Wind Farm. This plant was recently decommissioned by the facility owner. All the above ground components were removed but the underground wiring, concrete for foundations, and transformer pads remain in place. The owner states those components will be removed in 2019.  The owner also reports that they recycled 90% of the Cowley Ridge turbines and that 50% of the decommissioning costs were recovered through metal sales.

The big question is, what would have happened to the site if the owner simply walked away from it?  Would the landowner remove the facility? What if the landowner left? Would it cause environmental and safety hazards if left to deteriorate? This issue is being raised in Europe and North America. For example, the State of Montana’s Department of Environmental Quality requires bonding for wind farm developments 25MW or greater.

Since the start of this type of development, these concerns have been raised.  Over the years developers have provided answers similar to the following. With regard to the costs, “the value of the salvage pays for the removal and reclamation,” and also, “the site will be repowered at the end of the current equipment’s lifespan.”

Municipalities have also been told that the agreements in place between the developer and the landowner addresses these concerns and covers off the removal and restoration, as may have been the case in the Cowley Ridge example. However, concerns continue to be raised due to the recent issues around oil and gas well abandonment. When companies that sell off the asset, and the responsibility, or the final company goes bankrupt, what is the recourse for the landowner and eventually the municipality?

With the scale of these developments, what would happen if a development was abandoned after it is no longer able to produce? The idea has been suggested that the municipality could handle the issue as an unsightly premises and go after the landowner to clean it up. After all, that landowner may have benefited greatly over the years from of that project. If it is not done, a municipality eventually would go through the courts to get permission to remove it and add those costs to the property taxes. Due to the sheer scale of these developments and the costs for removing them, does there come a point when the cost is greater than the value of the land? If so, the landowner walks away and the municipality is left with the cost.

RMA Background:

6-18S: Wind Energy Regulations Required at the Provincial Level

THEREFORE, BE IT RESOLVED the Rural Municipalities of Alberta (RMA) request the Government of Alberta to undertake the creation of a Renewable Energy Division within the AER to approve, regulate, and enforce the responsible development, reclamation, and assessment of renewable energy projects in the Province of Alberta;

FURTHER BE IT RESOLVED that renewable energy projects formally proceeding into the review and approval stage of the above-noted Renewable Energy Division are to be corporately approved and construction ready projects, not speculative or conditional in any way;

FURTHER BE IT RESOLVED that the RMA request the Government of Alberta to set up and enforce the collection of monetary funds towards the implementation of an Orphan Renewable Energy Fund to oversee potential future reclamation of abandoned renewable energy sites.

DEVELOPMENT: RMA has not yet received a government response to this resolution.

Provincial Ministries:
Energy
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