From the Canadian Energy Centre

By Cody Ciona

Clean Electricity Regulations put Alberta grid at risk for ‘minimal emissions reductions’

Alberta is at risk of power outages by the mid-2030s as a result of the federal government’s Clean Electricity Regulations (CER), says a new report by the Alberta Electric System Operator (AESO).

The AESO’s analysis found the new regulations, which came into effect on January 1, will make the province’s electricity system more than 100 times less reliable by 2038.

Alberta has already reduced emissions from electricity production by 59 per cent since 2005 without the CER, according to the federal government’s national emissions reporting.

The finalized CER in December 2024 pushed out the federal government’s target of a net zero power grid from 2035 to 2050, but the AESO said the costs of the regulation continue to outweigh its minimal environmental benefit.

The CER essentially mandates the rapid and widespread adoption of technologies that remain under development or have not been commercially tested in Alberta, the AESO said.

This includes nuclear, large-scale hydroelectric generation, natural gas generation with carbon capture and storage, and hydrogen generation.

Due to restrictions on natural gas generation, the AESO forecasts an additional $30 billion in capital and operational costs between now and 2049.

The regulations will have high costs for Albertans, increasing wholesale electricity prices by 35 per cent above what they otherwise would be, the AESO said.

Along with potential reliability and affordability issues, the regulations will result in less than one million tonnes of emissions reduced annually, according to AESO.

“The significant cost that the CER will impose on Alberta’s electricity system for minimal emissions reductions means the regulation is inefficient and ineffective,” the AESO said.

“The threat to reliability resulting from the CER means that the regulation puts Alberta’s electricity grid at significant risk for little to no benefit.”

New Alberta reserves study finds Alberta’s gas reserves have increased six-fold, moving Canada’s gas reserves into the top 10 globally.

Alberta has always been a giant when it comes to natural gas, but after looking carefully at the Montney, Duvernay and the Deep Basin, new data has identified that the total gas resource in ground exceeds 1,360 trillion cubic feet (TCF). Of this, 130TCF is proved and recoverable gas reserves. For comparison, the latest U.S. government reserve number, using comparable methodologies, for Texas natural gas is 170TCF.

Adding these new gas reserves to other provinces’ reserves sees Canada’s overall gas number more than double and results in Canada’s ranking moving from number 15 to number nine globally.

When it comes to oil reserves, Alberta remains a titan with a total resource in ground number of 1.8 trillion barrels. Oilsands proven reserves are more than 165 billion recoverable barrels and there is other growth. For example, new opportunities like the Clearwater basin which has almost two billion barrels of new reserves. For comparison, Texas’ proved oil reserves sit at 20 billion barrels.

Alberta’s global ranking for oil has not changed, however the increase of seven billion additional proved barrels does result in extending the province’s total years of overall oil supply to 137 years.

“Alberta’s responsible energy sector has embraced technology and innovation, and these advancements have allowed us to unlock material gas reserves that were previously not accounted for. While other jurisdictions could face inventory concerns in the future, Alberta’s reserves will be essential for North America to continue accessing affordable energy.”

“This announcement reinforces that Alberta has the reserves needed to enhance long-term energy security for our trading partners. With vast amounts of gas, oil and liquids, Alberta’s energy sector is ready and willing to work with our U.S. partners to achieve global energy security.”

The study to review Alberta’s natural gas and oil reserves was commissioned by the Alberta Energy Regulator and was conducted by McDaniel and Associates Consultants. McDaniel is still completing this work and a final number for all fields and growth areas will be completed in the coming weeks.

“The continued expansion of Alberta’s reserves offers immense potential for long-term energy security, ensuring a reliable source of energy to support both domestic needs and international markets.”

Alberta’s government is working closely with industry to determine all options for egress to market in support of our aspiration to double Alberta’s oil and gas production.

Faced with uncertainty around trade and security, Alberta’s government remains focused on diplomacy and continuing to build a resilient and diversified economy that is better positioned to withstand external shocks and ensure long-term prosperity.

Background

• Reserves are the most accurate measure of a jurisdiction’s future oil and gas potential. McDaniel and the Alberta Energy Regulator use the Canadian Oil and Gas Evaluation Handbook methodology to perform reserve studies.
• Reserves are estimated volumes of hydrocarbon resources that analysis of geologic and engineering data demonstrates with reasonable certainty are recoverable under existing economic and operating conditions. Reserves estimates change from year to year because of:
  • price and cost changes
  • new discoveries
  • thorough appraisals of existing fields
  • existing reserves production
  • new and improved production techniques and technologies

Quick facts

• In 2023, Alberta produced 10.9 billion cubic feet per day (bcf/d) of natural gas. This was 61 per cent of Canadian natural gas production in 2023.
• Alberta is also the largest supplier of natural gas to the U.S. In 2023, Alberta exported 4.54 bcf/d to the U.S.
• Alberta oil directly supports more than 50 U.S.-based refineries with direct investment in more than 20 U.S. states, and is essential to affordability, growth, economic prosperity and energy security in the U.S.
• The U.S. Midwest continues to be the largest market for Canadian crude oil, followed by the U.S. Gulf Coast.
• As 2025 began, U.S. imports of crude oil from Canada reached a weekly record 4.42 million barrels per day, with the majority supplied by Alberta.