Saska. will not comply with proposed clean electricity regulations; feds call reasons ‘faulty conclusions’

Saskatchewan says it will not comply with federal clean electricity rules when they come into effect.

The statement, released in a news release Tuesday, is in response to a finding by the Saskatchewan Economic Impact Assessment Tribunal that implementing the draft clean electricity regulations would stifle job growth and cost billions of dollars.

According to the federal website, the rules are intended to support the transition to a net-zero electricity grid, help provinces and territories keep electricity affordable for Canadians and businesses, and maintain grid reliability.

However, the provincial tribunal found that, compared to the Saskatchewan Financial Accessibility Plan, the legislation would not improve financial access.

Court President Michael Milani said Tuesday that Saskatchewan’s economic growth, as measured by gross domestic product, would be at least $7.1 billion lower between 2025 and 2035 if the federal rules were to apply.

Milani added that the number of jobs will be reduced by 4,200, mainly due to the increase in electricity costs.

In a statement to CBC Saskatchewan on Tuesday, federal Environment Minister Steven Guilbeault’s office said the province’s decision was not surprising, but called the reasons “erroneous conclusions.”

Guilbeault’s office accused Saskatchewan of establishing a tribunal with a “basic ideological agenda” aimed at building a political fight against the federal government.

“The findings of this report are completely inconsistent with all the benefits we know come from building a cleaner network. “Saskatchewan is ideally positioned to be a leader in these economic opportunities,” the statement said.

Misunderstandings about costs

The five-member Saskatchewan Tribunal was established concurrently with the Saskatchewan First Act in 2023. Its purpose is to reaffirm the exclusive rights guaranteed in the Constitution and combat what Justice Minister Bronwyn Eyre described at the time as “excessive constitutional infringement” by the federal government.

“We cannot be complicit in the federal government’s economic harm to our province,” Eyre said in a press release issued Tuesday morning.

The release said Saskatchewan has placed the onus on the federal government to prove the constitutionality of the legislation before it imposes it on the province.

“We will not burden taxpayers with the costs of litigation against the federal government unless there is litigation,” Eyre said.

The Government of Saskatchewan refers to federal initiatives that it believes may harm provincial projects, operations, activities, industries, businesses or residents. In this case, the tribunal was asked to review clean electricity regulations in November 2023, Milani said.

The Court found that under the proposed regulations, residential ratepayers would pay $241 more in electricity costs by 2035. Similarly, commercial and small industrial ratepayers would pay $888 and $1,429 more, respectively.

Milani said the tribunal found that the technology necessary to meet the draft federal regulations does not exist and that the deadline makes it difficult for the industry to meet deadlines. It also determined that the province would likely not have sufficient manpower to meet the requirements by the required deadline.

“We also concluded that for this to work, people have to borrow money and invest capital. Companies have to be willing to make these changes,” Milani said.

He added that there is a possibility that companies that are unable to meet labor, technology or other requirements will move elsewhere.

Will Noel, an electricity analyst at the Pembina Institute, said he was surprised to learn that the provincial government would not comply with the regulations.

He was also concerned about the source of the data.

“If I am not mistaken, it appears that the analysis is based on the original wording of the clean electricity regulations that were published back in August,” he said.

According to the government website, Ottawa introduced changes to the regulations in February.

The Tribunal commissioned consultant Navius ​​to prepare a study that used economic models to compare clean electricity regulations to the Saskatchewan Affordability Plan.

Meanwhile, Guilbeault’s office said Saskatchewan has significant opportunities to profit by transitioning its grid to clean energy. That includes developing carbon capture and storage technologies, small modular nuclear reactors and renewable energy, according to the federal ministry.

As we read in the ministry’s statement, spending to increase electricity production will increase in all parts of Canada in response to the “dual needs related to the growth of the economy and population” and the desire to move away from fossil fuels.

However, according to the minister’s office, this will translate into future benefits, because building a cleaner grid will not only create thousands of jobs in Saskatchewan, but also provide residents with more affordable electricity rates in the long run.

Guilbeault’s office cited third-party research that predicts that by 2050, switching to clean electricity will reduce energy bills for most households.

The statement also maintained that federal clean electricity regulations would have little impact on spending to ensure that “electricity construction is as clean as possible.”

Change project

The feds also said Saskatchewan’s report included an outdated version of the draft clean electricity regulations.

“It is difficult to take this report seriously,” Guilbeault’s office said in a statement.

It said Saskatchewan’s report did not take into account “significant additional flexibilities that we have proposed and consulted on since the beginning of this year.”

Consultations are still ongoing, Guilbeault’s office said.

The statement continued to say the Saskatchewan tribunal did not include $40 billion “presented by the federal government to help provinces build a cleaner grid” that was promised in the 2023 federal budget.

“(This) ignores the millions of dollars the federal government has already invested in modernizing Saskatchewan’s power grids,” the federal statement said.

This includes $74 million for the development of small modular reactors, as well as $174 million for the upgrade of the EB Campbell hydroelectric power station, the implementation of smart meters, the modernization of Saskatchewan’s grid infrastructure, and wind and solar projects across the province.