Capital Power goes for the old “bait and switch” with new coal-fired power plant in Alberta

NOTE: This post has been changed from an earlier version for clarification.

In 2001 Alberta’s EPCOR Utilities Inc., which is today called Capital Power, wanted so much to build a new coal plant in the province that it committed, voluntarily, to offset emissions from the proposed 495 MW Genesee 3 facility by 50 per cent. It did this to win public support and support from regulators. Alberta’s utilities commission approved the project but, as part of its approval, it made the 50-per-cent reduction promise a requirement. The commission created a similar requirement for TransAlta’s Keephills 3 coal plant that followed, which is rated 450 MW. TransAlta is half owner of Genesee 3 as well.

Now, Capital Power is trying to weasel out of its obligation. It has applied to the commission to have the legal requirement removed. It would be bad enough if the commission allowed this, but most certainly if Capital Power got its way TransAlta would be asking for the same relief on Keephills 3.

“They’re basically saying it’s not fair,” said Chris Severson-Baker of the Pembina Institute, which is urging the commission to reject Capital Power’s request. Baker has the more detailed story here.

This is truly an unbelievable request. More than ever we need to move forward on emission reductions, not take steps backward. Alberta already has a sullied reputation when it comes to the tar sands and greenhouse-gas emissions. Reducing emissions from coal-fired plants — or at least offsetting them — is one way Alberta can try to buffer the emissions impact of the tar sands.

Both Capital Power and TransAlta know that the federal government will soon create regulations that require all new coal plants to meet the emissions profile of an equivalent-sized natural gas plant, and not through offset purchases, but through carbon capture and storage technologies. Genesee 3 has been operational for three years, and Keephills 3 will be coming online soon. They’ll be two of the newest coal plants in Canada and, by coming online before the federal rules, won’t have to comply until they reach the end of life in 40 years or so (though a future national cap-and-trade regime would presumably apply). If they can shake free of their commitment to the Alberta utilities commission it will mean more profits but more emissions as well.

I should say that Capital Power is arguing it should be permitted to break free from its earlier obligations so it can be subject to new provincial climate change pollution rules introduced a few years ago. The company says all power plants should be treated fairly and consistently and that its original voluntary commitment was not a permanent commitment, but that will be a matter to be decided by the commission. If the commission agrees, however, it will mean the 50-per-cent offset that Genesee 3 was once required to meet will fall to just 2 per cent under the province’s weaker rules and only reaching 12 per cent over the next six years. That’s a nice trade-off for Capital Power.

Letting them pull this kind of “bait and switch” would add significant GHGs in a province already struggling with an image problem. To cut Capital Power some slack would be an insult not just to Albertans, but to all Canadians.