By David Dodge, GreenEnergyFutures.ca
The energy transition is flipping our electricity grids upside down. Gone are the days when a grid consisted of a few big power plants with wires. Now, we’ve got millions of solar and wind farms, EVs, heat pumps, and all sorts of other decentralized energy sources.
No human can comprehend or manage these diverse power sources.
Imagine 250 million electric vehicles on the grid as soon as 2030, hundreds of thousands of solar systems, batteries, and heat pumps. These are referred to as decentralized energy resources and they can either be assets in building a reliable, resilient, and robust grid or they could be a nightmare.
Managing EVs, batteries, and other resources could be an amazing tool for making much more efficient use of an electricity grid that was traditionally overbuilt to satisfy daily or seasonal peak demand. Yup, most of the time only a small portion of the grid is used, and using it more efficiently means we can accommodate more cheap renewable energy and reduce costs.
But our 20th-century grids are like massive ships, slow to respond and turn and evolve to create the electricity policies, rates, and tools to respond to this massive change.
The Energy Innovation Challenge
The Energy Innovation Challenge seeks solutions for integrating solar, wind, EVs, and decentralized energy sources.
The challenge allows entrepreneurs and startups to propose their software, technical, or other solutions, get funding, and have their solutions piloted.
The Energy Innovation Challenge is being run in Alberta by Decentralised Energy Canada and the City of Medicine Hat.
“The Energy Innovation Challenge is almost self-explanatory because it is focused on finding solutions for grid and energy providers such as ourselves to make sure that we can transition through time and meet accelerated electrification requirements in a decarbonized way,” says Rochelle Pancoast, Managing Director of Energy, Land, and Environment for Medicine Hat.
Energy Transition – Time to roll up our sleeves
“There is lots of work for us to roll up our sleeves towards energy transition that introduces new, anticipated problems with changing supply mix, with different behaviours, and with different levels of consumption,” says Pancoast.
Pancoast says they are looking for solutions to solve these challenges and intend to pilot a few of the solutions in Medicine Hat that win the Energy Innovation Challenge.
It’s rarely talked about, but our old electricity grids have tons of excess capacity not being used, and at other times, there is a big squeeze during peak demand periods.
“It really is all about congestion. The Energy Innovation Challenge is working to work on grid decongestion at the system level and at the consumer level,” says Anouk Kendall, President of Decentralised Energy Canada.
As if foreshadowing the solutions that will rise to the top in the competition, she says, “This is where the predictive analytics, software solutions, modeling, and simulations can come into play to help them achieve this.”
Kendall is delighted with the 36 applications they received in the challenge.
Challenge winners will pilot solutions in Medicine Hat.
“So those shortlisted and selected to pilot their technologies within the City of Medicine Hat will receive up to $250,000 in additional funding towards their project to help commercialize their product or help bring that product to market here in Alberta,” says Grayson Mauch, Director of Utility Distribution in Medicine Hat.
Mauch is standing in a field inside the City of Medicine Hat with three large wind turbines behind him.
“The City of Medicine Hat currently has 299 megawatts of total generation capacity, which is a mix of 6 megawatts of wind power that you see behind me with the remainder coming from gas-fired generation.”
Medicine Hat is the perfect place to pilot new technologies
“One could consider the City of Medicine Hat as a microgrid if not one of the largest microgrids in Canada,” says Mauch.
Indeed, Medicine Hat is an island in the Alberta electricity grid. The envy of other jurisdictions, the City owns all of its own utility companies and is responsible for local operating policies and rate setting for residents.
This means it’s easy for them to test out new strategies for managing our evolving grid. This has also meant they have lower electricity rates.
The winners of the Energy Innovation Challenge will be announced at the Decentralised Energy Canada Forum at Whistlers on October 28-29.
Green Energy Futures will be there; why not join us there. Learn more at deforum.ca.
Medicine Hat’s Energy Transition Journey
Medicine Hat is known as “The Gas City,” a homage to their history of owning their own gas business that was quite lucrative for many years.
Back in 2008, a new city council started looking to the future.
“We needed to give back. We were making all of this money off a non-renewable resource, and it wasn’t sustainable,” said Alderman Ted Clugston at the time in a Green Energy Futures story. Clugston later became Mayor. “The natural gas supply may last many years for Medicine Hat, but Clugston said at the time, ‘we had to start thinking about the future.’”
So they set aside $1 million to start an innovative energy efficiency and renewable energy program called “Hat Smart,” an award-winning program that is still running.
“The HAT Smart program is really directed at our residential consumers within the City of Medicine Hat. It provides a series of rebates for various energy efficiency devices, as well as rooftop solar.”
Since the beginning, they offered a significant rebate for solar systems. It remains one of their most popular programs, which is oversubscribed every year.
Hat Smart – Still strong after all these years
Since 2008, Hat Smart has provided $6.2 million in rebates, and this past summer, they announced the City is launching the Clean Energy Improvement Program.
“It’s really a financing option for residents to access top-up payments to their property taxes, essentially in order to do similar things to invest in rooftop solar or other sorts of clean energy improvement options at the household level,” says Pancoast.
In response to droughts plaguing southern Alberta, Medicine Hat started a water conservation program in 2024.
“The City of Medicine Hat has been able to experience about a 14 to 16% reduction in water use this summer,” says Mauch.
The Hat’s Energy Transition Beginnings
Back in 2008, they also set a few goals – to reduce energy use by residents by 20% by 2020 and to get 25% of residential energy from renewable energy by 2025.
Part of their original strategy was to also build a small wind farm. That turned out to be an expensive endeavour, but they soon learned another company would build the small wind farm right in the City if the City entered into a long-term Power Purchase Agreement for the energy. The Box Spring wind farm consists of three large wind turbines right in the City.
A few years later, Medicine Hat landed millions of dollars to do a pilot Concentrating Solar Thermal Demonstration project, a 1-megawatt project that was tied directly into the City’s combined cycled gas-fired power plant.
It was funded mostly by grants, was bleeding edge in Canada, and in the end, the economics of concentrated solar in our northern climate did not work out. See analysis at Emissions Reduction Alberta website.
The removal of the project may have made both elected and administrative officials nervous about innovative projects.
Medicine Hat looking at solar
In recent years, Medicine Hat began to do some research and background work into how they should proceed with the energy transition this is coming.
“We did an analysis of various options that are currently available regarding energy transition and the transition to a low-carbon economy. We have found that utility-scale wind and utility-scale solar are economically viable today,” says Mauch.
“It’s been approved by the AUC for 325 megawatts, but we recognize that’s quite large for our local grid, and our ask of the AUC, the Alberta Utilities Commission, is to consider a first phase of upwards of 75 megawatts for our local needs,” says Pancoast.
Medicine Hat is working on a whole new energy transition strategy that is in the process of going before council there.
The City is currently looking to purchase an existing proposed 325 megawatt solar project also within the City.
“The City is looking at a whole host of other options, including carbon capture and sequestration for hard-to-abate businesses. We are looking at the Energy Innovation Challenge, as well as monitoring the industry and working with our various partner groups,” says Mauch.
The City is the only municipality in Alberta to secure an exploration permit for a carbon capture and storage hub.
It’s not economic at this point in time due to uncertainties with carbon pricing, but they see it as a potential business and an opportunity to attract businesses and help them deal with their emissions.
It turns out “Gas City” is already winding down its gas interests due to economics. The City has been shutting in wells and now supplies only about 7% of the local supply.
No one said energy transition is easy, but there are opportunities, and municipalities with limited resources, such as Medicine Hat, must be fairly pragmatic about their pathway. But new work is underway.
We will follow up with a story on the winners of the Energy Innovation Challenge in a future episode to find out where this is going.