Federal net-zero electricity regulations will permit some natural gas power generation: source

After facing pushback from Alberta and Saskatchewan, Canada's draft net-zero electricity regulations — set to be released today — will permit some natural gas power generation, CBC News has learned. 

A senior government source not authorized to speak publicly said that Environment Minister Steven Guilbeault will release Ottawa's proposed Clean Electricity Regulations on Thursday.

Provinces and territories will have a minimum 75-day window to comment on the draft regulations. The final rules won't take effect until 2035. 

Calling it a "technology neutral approach," the source said the federal government believes there's enough flexibility to accommodate the different energy needs of Canada's diverse provinces and territories. 

That means the proposed regulations would permit the use of non-emitting sources — hydroelectricity, wind, solar and nuclear — but also natural gas and diesel, if they meet specific criteria. 

Remote and northern communities not connected to the main power grid, which tend to rely on diesel, won't have to suddenly switch to solar or wind, the source said, as there would be exceptions in those places.

There will also be government programs to help them get off diesel, they said.

Meanwhile, places like Ontario and Alberta can continue to rely on natural gas power generation if they meet the proposed performance standards set out in the regulations with technology like carbon capture. Some natural gas power generation without carbon capture will be permitted during peak demand periods, the source added.

Although there will be flexibility, the source noted how cost-competitive renewables have become with fossil fuels — something the provinces and territories are expected to have to weigh as aging infrastructure reaches end of life, and considerable new investment will be needed to meet demand.

The Canadian Climate Institute says Canada's electricity-generation capacity will need to double or triple by 2050.

The federal government states that its modelling shows more than $400 billion is needed to replace aging facilities and expand generation capacity. Without such investments, the government suggests, Canada may be unable to respond to the pressure placed on the system from electric heating and cooling systems, electric vehicles and population and economic growth. 

As outlined in the 2023 federal budget, it's backed by a more than $40-billion commitment over the next decade to support Canada's clean electricity sector through tax measures, public financing and grant contributions.

Some of this money would be tied to the provinces and territories demonstrating they are committed to Ottawa's 2035 net-zero electricity grid.

The proposed regulations, the source said, will be the foundation for Canada's climate goals.