Alberta is no stranger to renewable power – it started generating hydroelectric power on commercial scale back in 1911. For its first fifty years as a Province, most of Alberta's power came from renewable hydroelectric sources and resulted in virtually zero emissions. In the beginning of the century, hydro was half the price of coal and continued to drop as the new larger dams and storage reservoirs were added in the Bow River system.

When Alberta ran out of economically viable hydro sites in the late 1950s, coal was chosen as the primary fuel for thermal generation. " Coal" was cheap, abundant in logistically developed areas around Edmonton and environmentally acceptable - coal mining was seen as the jewel of the North American economy. Unlike hydro, coal did not depend on seasonal water flows or require expensive upstream storage (which was frequently and successfully opposed by National Parks Canada). As a result, the capacity of coal-fired generators doubled, tripled and eventually left hydro power far behind.

With the added layers of environmental regulation and changing/decentralized market structures, Alberta started to gradually shift to natural gas and wind power in the early 2000s. Wind generation picked up speed when Alberta issued regulations to help it compete with coal and hydro, and eventually stand on its own. In the last 20 years, gas and wind have grown exponentially to almost 60% of Alberta's fuel mix and will continue to add generation capacity due to an expedited coal phase out by 2030.

In this article, we will (a) briefly outline the historical background to hydro, coal and wind power generation in Alberta, and (b) explain the relationship between Alberta's current sources of power generation.

Hydro Power in Alberta

In the 1880s and the early 1900s, Alberta's electricity was generated by small steam engines at sawmills which used scrapwood and saw dust as fuel for the generators. One of them was owned by Peter Prince of the Eau Claire Lumber Company located at what now is Prince's Island. These steam engines supplied power to a few affluent businesses and homes in central Calgary and kept the City's street lights on (with some significant interruptions that left the City in the dark of the winter for almost two years in 1892-1894).

Peter Prince and a few other entrepreneurs, as well as the City of Calgary itself, experimented with hydro power but were not able to bring it to commercial scale due to their lack of financing, engineering qualifications and hydro experience. To ensure its own power security, the City of Calgary built its Atlantic Avenue coal-fired plant in Inglewood and energized it in 1905. Similar coal plants were previously developed to serve municipalities in Edmonton (1891) and Lethbridge (1893), while Medicine Hat used its gas wells as a source for diesel-fired generators (1910).

The mastermind of the hydroelectric revolution in Alberta was Montreal's Max Aitken, subsequently knighted under the title of Lord Beaverbrook, who spotted potential hydro sites while travelling on a CPR coach from Vancouver to Calgary in the 1900s. Aitken had already invested in hydro plants in Quebec and he put that experience, as well as his access to international capital in Montreal, New York and London, to good use in Alberta. In addition to the booming City of Calgary, the new hydro site would also provide cheap power to Aitken's cement plants at Exshaw and Calgary.

Aitken's old friend and partner in many Canadian business ventures, R.B. Bennett, a Calgary lawyer and a strong conservative with ties to the CPR (as well as the 11th Prime Minister of Canada in 1930-1935), agreed to manage the operations of the new hydro business and negotiate a long-term contract with the City of Calgary. The Aitken-Bennett partnership launched Montreal-based Calgary Power (which relocated to Calgary in 1947 and was renamed TransAlta in 1981).

Calgary Power's first hydro site at the Horseshoe Falls was delayed due to a miscalculation of the Bow River flows. The spring runoff destroyed the original foundations and frames in May 1910 and the work had to be started from scratch. Calgary Power promptly fired its local engineers and retained Montreal Engineering, which brought its valuable hydro experience from Quebec to Alberta (and continued to help Calgary Power well into the 1990s). Smallpox that subsequently broke out in the work camp also delayed construction and complicated things for a project that relied exclusively on picks, shovels and wheelbarrows.

A year later, on May 21, 1911, Mayor Mitchel of the City of Calgary (population 43,706) flipped the switch and turned on the hydroelectric power from the Horseshoe Falls. At that time, the Calgary Herald likely expressed the general sentiment regarding Calgary's new and exciting source of power supply:

"What steam power was to the nineteenth century, hydro-electric power is to the twentieth [...] No city of today can hope to hold its own in the race for industrial supremacy without hydroelectric energy".

At half the cost of the coal power generated from the City's Atlantic Avenue power plant, it made perfect sense for the City to enter into a long-term contract with Calgary Power. As the winter flows on the Bow River were also miscalculated, to fulfill this contract with the City, Calgary Power needed additional generation and it quickly followed up with another hydro project at Kananaskis Falls in 1913. Despite some tough negotiations with the Stoney First Nations (which brought the Stoneys all the way to Ottawa to strike a deal), the Kananaskis site was built and energized on schedule.

Calgary Power was now in business and looking to expand beyond the City of Calgary to meet the need of the young, energy hungry Province of Alberta.

The subsequent expansion of hydroelectric power came in three waves:

  • 1920 - early 1930s: first and second Ghost Dam units, which doubled Calgary Power's generation capacity (and almost bankrupted the company as Alberta slipped into the Great Depression).
  • 1940s: Barrier Hydro Project and expansion of the storage capacity at Lake Minnewanka (at the expense of the beautiful cottages, hotels, restaurants and the clubhouse, which all went under water to meet the power "needs"of the Dominion of Canada - also known as the Underwater Ghost Town). 
  • 1950s: Spray, Three Sisters and Rundle, Bearspaw, third Ghost Dam unit, Pocaterra and Interlakes.

With the expansion of hydro power in Alberta between 1911 and the 1950s, the cost of hydroelectric power continued to drop as every cubic metre flowing through the Bow River hydro system could generate power eight times (!) before reaching Calgary.

Switch to "King Coal" and Thermal Generation

Until the 1950s, most of Alberta's power was hydroelectric and resulted in zero emissions. By that time, however, nearly all potential hydro sites had been developed and those located on northern rivers were determined to be uneconomic (only in the 1960s would the large Brazeau and Bighorn dams  be developed on the North Saskatchewan River to supply Edmonton).

As a result, Calgary Power started to develop thermal power generation with coal as its new low-cost fuel that was abundant and environmentally non-controversial (at the time). Unlike hydro, which was heavily dependent on river flows and required significant storage in areas that were controlled by National Parks Canada, coal was readily available and there was transportation capacity in and around Edmonton to deliver this fuel from new coal mines.

In 1956, Calgary Power energized its first coal-based thermal generating station at Lake Wabamun, west of Edmonton. Until the coal mine was developed, Calgary Power initially operated these generating units on natural gas (gas was used for power generation near Medicine Hat as early as 1884). Calgary Power owned both the coal mines and a growing number of coal-fired generators - multiple units of Sundance came online in the 1970s and Keephills in the 1980s. In that time frame, further coal-fired generators were added to the mix by other companies, such as ATCO.

Within three decades, Alberta's coal generation doubled, tripled and quickly left far behind all of the hydroelectric generation capacity installed in the first half of the century.

Development of Wind Power in Alberta

Commercial scale wind power was launched in Alberta with the adoption of theSmall Power Research and Development Actin 1988, which required public utilities companies to purchase power from pilot projects of small power producers at a prescribed rate, which was higher than the current price of coal and hydro generated power.

The first commercial wind farm in Canada was built near Pincher Creek in 1993-1994. TransAlta acquired this 44 MW, 67 wind turbine project from Canadian Hydro Developers in 2009 and decommissioned it in 2016 when it reached its end of life. In 2020, there are multiple wind farms both in South and Central Alberta and new projects continue to be added as wind is generally competitive in the current "energy only"market.

However, wind is also intermittent by nature and without reliable energy storage (battery or otherwise), which does not exist on Alberta's grid, wind alone cannot provide baseload capacity to keep the system in balance. As a result, a significant amount of gas-fired generation has been added since the early 2000s to supplement coal as a source of baseload generation (coal to gas conversion is in full swing now across Alberta to reach the federal 2030 goal ahead of time).

Sources of Power Generation in 2020

If Mayor Mitchell flipped on the switch at the City of Calgary in 2020 (population 1,285,711), he would have seen these sources of power in Alberta*:

  • Hydro – 5%
  • Coal – 34%
  • Gas – 47%
  • Wind – 11%
  • Other (solar, biomass, etc.) – 3%

(*based on the maximum capability in the AESO's Current Supply and Demand Report, April 19, 2020).

Mayor Mitchell would have been surprised to see that coal generation has outdone hydro, which in his days was far superior both in terms of cost and available capacity and, as such, was seen as the way of the future and the driver of Calgary's and Alberta's economic success. The federal goal to phase out coal by 2030 would also be news to Mayor Mitchell, especially given how dominant it has been in Alberta's power supply since the 1950s.

Fast forward 109 years and Alberta is ready to abandon King Coal in favour of the new generation of fuel supply – gas, wind and, to a lesser extent, solar energy. As Alberta still lacks reliable energy storage solutions and needs the guaranteed baseload capacity on the grid, the Province will require gas-fired thermal generation to supplement wind and solar supply. There is no doubt that natural gas is the "New King"- a cheap and abundant source of power, which is likely to remain on top of the fuel mix given the current direction of oil prices and energy markets.

In 2020-2021, Alberta expects to add a further 2-3% of wind generation, and perhaps another 1-2% of new solar generation (based on in-service dates in the AESO's Connection Project List, April 2020). By 2030, Alberta's power grid will be coal-free and the Province will boast of an accelerating transition to its renewable energy glory days of 1911.

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