IPPSA Intelligence

AESO

Alberta’s electricity system operator has halted the planned 240 kV Chapel Rock-to-Pincher Creek transmission development after anticipated local generation failed to materialize, conserving resources and avoiding unneeded infrastructure. Simultaneously, the operator filed a Needs Identification Document for the Dobbs 2061S Substation, kickstarting regulatory justification and engagement processes for project P2256. Stakeholders can access detailed project information and contribute feedback via the AESO website.

Parallel consultations are underway on amendments to ISO rules and tariffs—specifically Section 503.22 Technical Requirements for bulk lines and Section 503.1 specifications—following a November reply letter.

A series of stakeholder sessions and feedback deadlines through mid-December address cost-of-service studies, market power mitigation methodologies, and reliability standards synchronization.

These timely engagements underscore a shift toward responsive infrastructure planning, rigorous regulatory scrutiny and strengthened industry participation.

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AUC 24 Month Application Forecast

Alberta’s energy regulation is evolving toward greater transparency and modernization. The Alberta Utilities Commission now publishes a 24-month application forecast covering rate adjustments, facility approvals and reliability standards for 2026–2027. Public input is sought on key regulatory reforms, including interim honoraria for Indigenous participants under Rule 009, new water utility rate procedures in Rule 011 and micro-generation amendments in Rule 024.

Updated facility application guidelines in Rule 007 align approval timelines and consultation processes with government policy and emphasize engagement with Indigenous communities. These changes allow utilities and project developers to plan investments, reducing uncertainty and accelerating infrastructure deployment.

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TIER Updates

The changes to Alberta's TIER regulation were formally announced this week through the Order in Council 369/2025, introducing two key updates to the industrial carbon pricing system. The first major amendment establishes a new direct investment compliance pathway for large industrial emitters. This allows regulated facilities to fulfill their TIER obligations by making approved, on-site investments in emissions reduction technologies—such as carbon capture or energy efficiency projects—rather than exclusively meeting compliance through reducing on-site emissions, trading credits, or paying into the TIER fund.

The second core change provides flexibility for small emitters that had voluntarily opted into the TIER system. These smaller facilities are now permitted to opt out of the regulation in 2025. This move aims to reduce compliance costs and administrative complexity for these businesses, especially since the federal fuel charge—which was the main reason many chose to opt-in—was recently set to zero. 

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Industrial Boilers Get Decades-Long Reprieve - Compliance Deadline Extended to 2036

The Regulations Amending the Multi-Sector Air Pollutants Regulations (MSAPR), published in the Canada Gazette, Part 2, Volume 159, Number 25, primarily focus on updating technical and compliance requirements for industrial boilers and heaters. A key element of these amendments is the addition of flexibility regarding testing requirements, particularly for measuring Nitrogen Oxides emissions. The goal is to accommodate a greater variety of equipment configurations and ensure that facilities can conduct safe and valid NoX tests.

Crucially, the amendments also grant an extended compliance period for owners and operators of certain pre-existing boilers and heaters—estimated to be around 218 units—that previously struggled to demonstrate compliance due to the complexity of the existing testing provisions, allowing them more time to retest their equipment and demonstrate conformity. The compliance deadline for "Class 70" boilers and heaters, which fall within a certain range of NOx emissions, has been extended by a decade, shifting from January 1, 2026, to January 1, 2036. 

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Halkirk 2 Wind Farm Returns to Alberta Grid After Turbine Collapse

Halkirk 2’s return to service after a November 8, 2024 turbine collapse highlights construction quality and grid resilience issues in Alberta’s expanding wind fleet. An investigation by the turbine manufacturer and an independent third party found improperly calibrated tooling was used to tension tower‑to‑nacelle bolts, causing Tower 33’s failure and prompting a temporary suspension of commissioning across the site.

Commissioning resumed the week of November 24, 2025, and the project began supplying power to the Alberta grid by November 25, with commercial operation targeted by year‑end 2025 subject to weather and commissioning progress.

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Canada Launches Centre for Fusion Energy

The new Centre for Fusion Energy in Canada unites federal and provincial governments with industry to accelerate fusion R&D and prototype development. Led by AECL with delivery by Canadian Nuclear Laboratories, and anchored by Ontario Power Generation and private partner Stellarex, the public‑private partnership mobilizes $33 million in AECL/CNL in‑kind research, $19.5 million from Ontario/OPG and up to $39 million from Stellarex.

It leverages Canadian strengths—CNL’s materials and tritium research at Chalk River and OPG’s commercial tritium from CANDU reactors—to build a coordinated national ecosystem that links to existing initiatives such as Fusion Fuel Cycles, UNITY‑2 and global private developers. Objectives include creating domestic technical capability, workforce training, prototype testing and attracting further investment to position Canada as a fusion hub.

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Proposed Deep Sky Direct Air Capture Project in Southwest Manitoba Raises Concerns

Deep Sky Climate proposes a multi‑phase Direct Air Capture (DAC) facility in southwest Manitoba, claiming geologically suitable sites in the RM of Pipestone and Municipality of Two Borders and estimating about $200 million to develop phased capture from roughly 30,000 t/yr in Phase 1 to 500,000 t/yr at full scale. 

Critics cite high current costs (circa $1,000/t with industry hopes of falling toward $100/t), substantial continuous electricity for fans, separation and compression, significant water demands, and large capital outlays for compressors and sorbents. Community town halls drew strong local concern about groundwater, long‑term risks of underground CO2 injection, and strain on Manitoba Hydro amid reported winter peak shortfalls.

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Manitoba joins call for federally funded national grid

Manitoba renewed a push for a federally backed national electricity grid aimed at expanding interprovincial transmission to move more power domestically and boost exports. Joining an Ontario-led memorandum, the province is seeking federal funding to link hydroelectric resources and new wind developments—planned in partnership with Indigenous-led organizations—to markets across Canada and the United States.

Crown-owned Manitoba Hydro already exports electricity to Ontario, Saskatchewan and the U.S. but warns it may need new generation as soon as 2029, prompting plans for additional capacity. Proponents argue that expanded transmission would create economic opportunities from increased exports while supporting decarbonization by supplying clean power to northern oil and gas operations and other heavy-emitting regions.

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A Potential Catalyst for a Pan‑Canadian Transmission Grid

The federal budget’s new 15% clean‑electricity investment tax credit (ITC), linked to the Canada Infrastructure Bank and Canada Growth Fund, could materially change how large interprovincial transmission projects are financed and how a pan‑Canadian grid is built. While the budget also expands subsidies and tax credits for oil, gas and carbon capture, the ITC—available to provincial Crown utilities—lowers project risk and can improve bankability for long, costly interties that would connect Western Canada, Québec and the Maritimes.

Major obstacles include fragmented provincial regulation, ad hoc intertie negotiation, unclear cost allocation, and the need for Indigenous and community engagement. Experts endorse a bottom‑up approach—align provincial plans, create coordinating bodies, pilot projects, and secure stable funding—to make the ITC effective.

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Canada Open to Negotiating Clean‑Electricity Rules with Provinces

Canada’s federal government is signaling flexibility in implementing clean electricity regulations aimed at reaching a net-zero grid by 2050, with phased requirements beginning in 2035. Energy Minister Tim Hodgson said Ottawa is prepared to negotiate exemptions for provinces—beyond Alberta—if their own policies demonstrably meet the federal standard. The stance maintains national decarbonization goals while allowing provincial approaches that achieve equivalent outcomes, highlighting a cooperative federal-provincial dynamic rather than a purely prescriptive one.

Practically, exemptions would hinge on assessments of policy equivalency, creating space for jurisdictions with strong existing plans to retain autonomy while aligning with emissions targets. Economically, negotiated pathways could affect investment signals in generation, transmission and clean technologies by preserving market predictability for provinces that secure equivalency agreements, but they also introduce uncertainty about what constitutes acceptable substitutes for federal rules.

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Integrated U.S.–Canada Electricity Grid Seen Resilient

Long-standing physical and operational links between the U.S. and Canadian electricity grids create a resilient, interdependent system that is unlikely to be severed by short-term political disputes such as recent tariff frictions. Regulators, system operators and market participants represented on a utilities conference panel emphasized that interties support reliability, balancing and cross‑border market transfers, and that mutual technical needs and established coordination protocols give strong incentives to preserve cooperation.

While tariff disputes introduce risks — including potential impacts on equipment costs, contractual arrangements and financial flows — panelists argued these risks alone won’t automatically disrupt day‑to‑day operations. Bodies such as NERC, federal and provincial/state regulators, and regional transmission organizations play central roles in oversight, contingency planning and signaling to markets, meaning regulatory guidance will shape responses if tensions escalate.

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IPPSA's Mandate

IPPSA's mission is to convene industry, providing information, resources, and a forum for knowledge sharing, and to create opportunities for dialogue, collaboration, and education. This newsletter is meant to inform members but not advocate for specific outcomes. We always appreciate your feedback at info@ippsa.com.