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Solar energy to help cities financially

Solar energy to help cities financially

(Innisfail, Alberta) A small main street that has seen better days, a railway line running past City Hall, about 8,000 people surrounded by plains… At first glance, nothing distinguishes Innisfail from the series of small rural municipalities that line Highway 2 between Edmonton and Calgary. . However, a real energy revolution is taking place there.

Municipal employees are no longer the only ones working for taxpayers. The roofs of City Hall, the fire station and the curling center also do their part. A large field is also northwest of the city. Soon, another site will be established in the southwest of the city, where the former municipal sewage lagoon has been converted into an industrial park. All thanks to solar energy.

Solar panels installed on municipal buildings generate electricity, which is useful for lowering bills, but also for generating carbon credits. The sale of these credits is expected to generate between $7,000 and $10,000 net annually over the next 10 years, according to city estimates.

The solar panels installed on municipal land in northwest Innisfail belong to Elemental Energy, a Vancouver company. Following Highway 54 through the fields, you can see some of them sparkling in the sun.

Elemental Innisfail is a large commercial solar farm with a production capacity of 22 MW.

The company signed a 35-year lease to use the land. The municipality derives three sources of annual income from it. In addition to rent (about $12,000), the agreement brings in more than $235,000 in property taxes, a significant contribution to a municipality that has seen its population increase barely 2% since 2016. Elemental is also paying a $20,000 community contribution to the city, which helps support Various projects.

Photo courtesy of the City of Innisfail

Innisfail Mayor Jean Barclay

We had this land that wasn't going to be developed for four or five decades. Why not put together something that can provide a good source of income?

Jan Barclay, Mayor of Innisfail

However, Innisfil had to play the leading role. When Elemental officially announced the project in the fall of 2019, the province only had one commercial solar farm in production, which was owned by the same company. It's not easy to negotiate. “It wasn't easy, because there was only one other, in Newell County, near Brooks. “We were the second, but the first in an urban area, so for the administration, it was very difficult to get data and find details about anything.” , sums up Mayor Jan Barclay, who met in the room.

The model was successful. At least ten municipalities in Alberta today collect municipal taxes from solar producers on their land, for nearly $4.5 million in annual revenue, a 2022 analysis by BRC-Canada, an affiliate of the Pembina Institute, shows. Preparation phase.

Innisfail has taken the energy experiment a step further, developing its own solar farm project to sell electricity to the grid.

The land formerly occupied by the municipal sewage lagoon became an industrial park, but a few acres could not be rehabilitated enough to accommodate buildings.

The municipality plans to install a small solar power plant with a capacity of about 2 megawatts there, a $4 million project that will absorb nearly half of its 2024 investment budget.

All that's missing is the green light from the Alberta Utilities Commission (a type of Alberta Energy Authority) to start construction. Mayor Barclay hopes to have the plant in operation by the end of the year.

The electricity will be sold to Fortis, which owns 60% of the distribution network in the governorate. Innisfail expects to generate revenue of about $600,000 annually, plus an additional $10,000 from selling carbon credits.

For a small town with a population of only 8,000, this is a big deal. In Innisfail, every $100,000 in additional revenue equates to an increase in the property tax rate of about one percentage point.

The city's mayor says that these solar projects, in addition to their environmental aspect, respond above all to economic imperatives.

“We focus on generating revenue because our municipal tools are very limited,” Jan Barclay recalls. The solar energy project is beneficial for residents and society, because it will help reduce tax increases. »

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