By: Kelsey Sonntag, Chad Eggerman, Janelle Anderson, Glenn Wright
This is the fifth article in an 8-article series, Renewable Energy in Canada 2024, which covers each provincial jurisdiction and the territories, released by the Energy Group at Procido LLP. The Renewable Energy in Canada 2024 series aims to provide an overview of the current state of renewable energy across the country. The fourth article Renewable Energy in Ontario: The Next Superpower? reported on Ontario. This article provides an update for Saskatchewan.
Section 92A (1)(c) of the Constitution Act, 1867 of Canada grants exclusive powers to the provinces to enact laws related to the “development, conservation and management of sites and facilities in the province for the generation and production of electrical energy”.
Saskatchewan Renewable Energy Framework
While Saskatchewan may be best known for its flat and windy prairie landscape in the Southern half (the Northern half of the province is covered in dense boreal forest, lakes, and rocks), it’s also one of the sunniest places in Canada. Regina and Saskatoon are listed as the top two major cities in Canada for photovoltaic potential in Canada, per a 2018 report by the Government of Canada. Despite the strong potential for developing more solar and wind projects, the majority (75%) of electricity supplied in Saskatchewan is generated from fossil fuels. However, SaskPower, the vertically-integrated Crown corporation with a legislative monopoly on electricity generation, distribution, and transmission in Saskatchewan, has committed to reaching net-zero GHG emissions by 2050 and to achieve a GHG emissions reduction target of 50% below 2005 levels by 2030.
Saskatchewan boasts some of the best wind resources in Canada, and indeed in the world, and could dramatically increase its wind power output. However, following opposition to wind projects in Alberta, there has recently been significant push back from local communities in Saskatchewan regarding the construction of wind turbines. In a series of articles, the local publication, SaskToday, documents the trouble oil and gas pipeline company, Enbridge, has been facing with their proposed Seven Stars Wind Energy Project in the rural municipalities of Weyburn and Griffin (the “RMs”). Enbridge was seeking an amendment to the RM zoning bylaws to reduce the distance a wind turbine must be from a residence from 1000 metres to 750 metres. In many parts of Canada, the minimum setback for wind turbines is 550 metres. This caused an outcry from local residents and Enbridge has since paused the entire project and specifically their application for amendments to the setbacks as they seek to conduct consultations with the community. Even though this project has been in the works since 2017, local residents claim they were unaware of it until July of 2024. The RM of Weyburn has put a moratorium on the project and residents have sent letters to Premier Scott Moe, leader of the governing Saskatchewan Party, asking him to stop the project. In the meantime, the council wants to put forward a resolution at the next Saskatchewan Association of Rural Municipalities (SARM) convention, to lobby the government of Saskatchewan to put in regulations at the provincial levels for the development of turbines. Currently the decision is left to local RMs to determine how to regulate wind power generation facilities through bylaws. Some RMs in Saskatchewan remain supportive of wind power, but due to the politicization of energy in Saskatchewan, support amongst RMs is waning.
Notwithstanding recent problems, in addition to wind, solar energy is gaining traction in Saskatchewan. The cost of solar technology continues to decline, making it a more viable option for both residential and commercial applications. SaskPower is planning to develop a number of utility-scale solar power projects in south central Saskatchewan.
Hydroelectric power, although more limited in Saskatchewan compared to other provinces like British Columbia and Manitoba, plays a role in the renewable energy framework. The province has a number of existing hydro power generation facilities and is exploring opportunities to enhance existing hydro facilities and develop new hydro projects, particularly in the northern regions where water resources are more abundant. This diversification of energy sources not only supports grid stability but also helps to mitigate the impacts of climate variability, even though seasonal water flows and levels to support dams and generators are becoming less consistent.
Recently the Government of Saskatchewan has turned its focus away from wind, solar, and hydro power and is looking toward developing nuclear energy — specifically through small modular reactors (SMRs). Large industrial entities in Saskatchewan, for example in the mining sector, are being led to believe that their privately owned mine sites can be powered by publicly financed and owned SMRs in the future. Through the Renewable Access Service program (currently in pilot but scheduled to go live in 2025), large industrial entities in Saskatchewan can enter into an arrangement similar to a virtual power purchase agreement (VPPA) to procure wind and solar power from IPPs. However, the government’s push to have the public pay for SMRs has led to some mining companies delaying and postponing VPPA projects in Saskatchewan.
No operational SMRs exist in Canada and there are only a handful in operation in the world. Nuclear power is one of the most expensive sources of electricity in the world, while solar and wind are the cheapest. Nuclear power generation projects are among the most complex and risky projects, while wind and solar are comparatively simple with significantly less risk. It is unclear if uranium mined in Saskatchewan would ever be used in the SMRs and what would be done with the waste. SMRs are small – usually between 100 MW to 300 MW – the same size as a single natural gas power generation facility. Many SMRs would be required to replace the 75% of electricity supplied now by fossil fuel generation in Saskatchewan. Although there are many challenges undertaking to build SMRs with a small population in Saskatchewan (the entire population of Saskatchewan is less than the City of Calgary), cost is likely the biggest challenge to overcome. An investment decision by the province to build SMRs would require spending massive amounts of money (as much as $5 Billion for a single 300 MW unit or $4000+ per person). In the decades ahead it may become clearer whether SMRs will contribute to Saskatchewan’s electrical generation but in the meantime it appears that SaskPower will continue to conduct pre-feasibility and site selection work to determine if SMRs will be part of a viable alternative to replace the 75% of electricity presently generated by natural gas and coal.
Indigenous Projects and Incentives
First Nations and Métis communities are playing a major role in the development of renewable energy in Saskatchewan. Cowessess First Nation, in partnership with Saskatchewan Research Council, developed Saskatchewan’s first wind and storage hybrid system, which came online in 2013. Cowessess has also recently closed a deal to build a 200 MW windfarm in west-central Saskatchewan. The Bekevar Wind Energy Project is expected to bring over 25 years of economic prosperity to the First Nation community while employing Indigenous contractors and workers. Meadow Lake Tribal Council Solar Energy completed an 816-kilowatt solar farm in June 2024 that is owned by all nine First Nations communities in the council. Revenue will be returned to members of the community to support community programs and services.
The Saskatchewan Indigenous Investment Finance Corporation (SIIFC) was recently established to provide access to capital for Indigenous communities and entities participating in Saskatchewan’s natural resource and value-added agriculture sectors. Eligible renewable energy projects include solar, wind, hydro, geothermal, biomass, municipal solid waste to energy, landfill gas and biogas to energy, carbon capture, utilization and storage.
SaskPower has signed an agreement with First Nations Power Authority to find a proponent to develop, own and operate a 100 MW solar generation facility to be located in south-central Saskatchewan. SaskPower will buy the power generated from this facility through a long-term Power Purchase Agreement. The successful proponent is required to have a minimum of 30% equity ownership by two or more Saskatchewan First Nations. At least one of these Nations is to not have previous experience in utility-scale solar projects, to further the development of First Nations and aid in building their capacity.
Saskatchewan Election
As of the date of this article, the Province of Saskatchewan is in the midst of an election. The current governing Saskatchewan Party has avoided providing any commitment to renewable energy in their platform and instead have focused on making Saskatchewan a nuclear province and are relying on SMRs to reduce emissions in the future. The Saskatchewan Party has previously committed to reduce emissions from electricity generation to zero by 2050. The Federal government currently requires net-zero from power generation facilities by 2035 in Saskatchewan and other jurisdictions. The Saskatchewan United Party, who is running 31 candidates in the 61 ridings in Saskatchewan, has a platform to scrap all net-zero targets and continue burning coal and natural gas to produce electricity until reserves are depleted and “well beyond Scott Moe’s Net-Zero by 2050 agenda”. The opposition Saskatchewan NDP have been very supportive of renewable energy development in the past, but have avoided commitments in their 2024 platform. So, irrespective of the results of the election, provincial government support for renewable energy in the next four years is not likely to be significant. The best-case scenario for the renewable energy industry would be if the Saskatchewan NDP form government and continue on with the Saskatchewan Party’s past commitments and possibly incentivize some further development. If the Saskatchewan Party form government, past commitments to develop more renewable energy may be tempered as the focus shifts to nuclear. If the Saskatchewan Party and Saskatchewan NDP have roughly equal seats and the Saskatchewan United party were to gain a seat or two and hold the balance of power in the legislature, we may even see renewable energy development in Saskatchewan scaled back considerably or even stopped completely. Like in Alberta, what lies ahead for renewable energy in Saskatchewan appears to be storm clouds on the horizon.
Procido LLP’s Energy Group advises Indigenous groups, developers, suppliers, and landowners on renewable energy projects in Saskatchewan. The 6th article in the Renewable Energy in Canada 2024 series will cover Quebec.
Disclaimer
This publication is provided as an information service and may include items reported from other sources. We do not warrant its accuracy. This information is not meant as legal opinion or advice. Contact Procido LLP (www.procido.com) if you require legal advice on the topics discussed in this article.