Alberta's Electricity Grid: A Comprehensive Overview

Alberta's electricity grid forms the backbone of the province's energy system, supplying power to over 4.3 million Albertans through an extensive network of generation, transmission, and distribution infrastructure. This report examines the current state of Alberta's electricity grid, its evolution, structure, and future direction.

Infrastructure and Capacity

Alberta's power grid comprises approximately 26,000 kilometers of transmission lines connecting nearly 426 qualified generating units and 250 market participants to the wholesale electricity market1. The province's system features three interties with neighboring jurisdictions—Saskatchewan, British Columbia, and Montana—facilitating electricity imports and exports1.

As of 2024, Alberta's total installed generation capacity reached 23,122 megawatts (MW), an 11.3% increase from 20,777 MW in 20236. This substantial growth included 1,876 MW of new gas-fired generation and 1,369 MW of wind and solar capacity6. The system's impressive scale is reflected in its transmission and distribution networks:

Transmission Infrastructure

Alberta's high-voltage transmission system is owned and operated by four major Transmission Facility Owners (TFOs):

AltaLink: Operates approximately 12,000 km of transmission lines serving 85% of Albertans10
ATCO Electric: Manages roughly 10,000 km of transmission infrastructure10
ENMAX Power Corporation: Serves Calgary and surrounding areas2
EPCOR Utilities: Primarily serves Edmonton2

Recent infrastructure development includes the Central East Transfer-Out project, a 130-kilometre high-voltage power line adding 750 MW of electrical capacity to strengthen grid reliability11.

Distribution Networks

The final stage in power delivery occurs through distribution networks operated by several entities:

ATCO Electric: 62,000 km serving 215,964 customers in northern & east central Alberta10
FortisAlberta: 116,000 km serving 503,644 customers in southern & central Alberta10
ENMAX: 7,700 km serving 444,549 customers in Calgary10
EPCOR: 5,000 km serving 350,708 customers in Edmonton10
Various municipalities and 34 Rural Electrification Associations also manage local distribution10

Generation Mix Evolution

Alberta's electricity generation landscape has undergone remarkable transformation over the past decade:

In 2013: 52% coal, 38% natural gas, 10% renewable4
In 2023: 74% gas, 8% coal, 18% renewable4
As of June 2024: Coal completely phased out, with the last coal-capable generator converted to 100% natural gas4

The renewable energy sector has experienced particularly rapid growth, with wind capacity reaching 5,688 MW and solar capacity rising to 1,812 MW by 20246. Indeed, in 2023, Alberta accounted for 92% of Canada's growth in renewable electricity generation3. The province has a legislated goal of achieving 30% renewable electricity by 20304.

Market Structure and Governance

Alberta operates one of North America's few deregulated, energy-only electricity markets, established through the Electric Utilities Act113. This unique structure features several key institutional players:

Key Institutional Players

Alberta Electric System Operator (AESO): An independent, not-for-profit entity responsible for:
- Managing the power grid 24/7
- Operating the wholesale electricity market
- Planning future system infrastructure
- Connecting customers to the grid12
Alberta Utilities Commission (AUC): Regulates the province's utility sector and approves transmission and distribution rates1
Market Surveillance Administrator: Monitors market participant behavior to ensure fair competition1
Utilities Consumer Advocate: Provides information and representation for consumers on utility matters15

Market Operation

In Alberta's competitive market, electricity suppliers submit hourly offers into the power pool. The AESO dispatches electricity starting with the lowest-priced offers and selecting progressively higher-priced energy until demand is met16. All suppliers then receive the price of the highest dispatched offer for that hour16.

This market structure has created a dynamic environment where, in 2024, the average wholesale electricity price dropped 53% to $62.78 per megawatt-hour, down from $133.63 the year before6. Natural gas prices also fell 49% to $1.30 per gigajoule during this period6.

Recent Developments and Challenges

Alberta's electricity system has experienced several significant developments and challenges in recent years:

Supply and Demand Dynamics

Average internal load rose 2.6% to 10,112 MW in 20246
Seasonal peak records were set in both winter (12,384 MW on January 11) and summer (12,221 MW on July 22) of 20246
Alberta became a net electricity exporter in 2024, with average exports of 343 MW exceeding average imports of 132 MW6

Reliability Concerns

The system faced two major reliability events in early 2024:

In January 2024, during extreme cold (-40°C temperatures), an emergency alert was issued asking Albertans to conserve power19
In April 2024, a supply shortfall led to rolling outages—the first such event in 11 years18 19

These events prompted an investigation by the Market Surveillance Administrator, which made seven recommendations to prevent similar incidents19.

Policy and Regulatory Changes

Several policy changes have affected Alberta's electricity landscape:

Federal Clean Electricity Regulations: Implemented in January 2025, these regulations aim to reduce emissions but could potentially impact system reliability. The AESO has warned they could make Alberta's electricity system more than 100 times less reliable by 203817.
Renewable Energy Moratorium: In August 2023, the provincial government imposed a seven-month pause on approvals for renewable energy projects over 1 MW. This affected 118 projects representing approximately $33 billion in investment2122.
Transmission Cost Allocation: New plans to allocate costs for future grid infrastructure based on "cost-causation principles" could affect the viability of new renewable energy projects20.

Future Outlook

Alberta's electricity system continues to evolve, with several key developments on the horizon:

Planned Investments

The AESO's 2025 Long-term Transmission Plan identifies $7.1 billion in transmission investments over the next 20 years, including $4.3 billion in the next 5 years23. These investments are categorized as load-driven, generation-driven, or intertie-driven, with 65% of planned costs being generation-driven23.

Policy Transitions

Alberta is transitioning from its current "zero congestion" transmission policy to an "optimal transmission planning" framework, with new regulations expected later in 202523. This represents a significant change in how transmission infrastructure is planned and funded.

Emerging Challenges

Several emerging challenges will shape Alberta's electricity future:

Data centers in the connection queue represent 8,600 MW of potential demand23
Integration of increasing amounts of variable renewable generation requires market adaptations
The need to balance reliability, affordability, and environmental goals continues to drive policy discussions

Conclusion

Alberta's electricity grid has demonstrated remarkable evolution over the past decade, transitioning from coal dependence to a system dominated by natural gas with a growing share of renewables. The province's unique deregulated market structure has enabled rapid deployment of new generation capacity while facing challenges in grid reliability and policy direction.

As Alberta navigates the complex intersection of energy security, affordability, and environmental considerations, continued innovation in both market design and infrastructure development will be essential to maintaining a reliable and sustainable electricity system for the province's future.

Citations:

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