City of Medicine Hat seeks approval to acquire Saamis Solar Park project

The solar power plant and accompanying substation were approved, with conditions, by the Alberta Utilities Commission (AUC) on July 18, 2024 under the ownership of Saamis Solar Park Ltd, part of the Irish-headquartered DP Energy Group. The current AUC approval enables construction to begin in 2025 and to be in service by 2027.

“Engagement with the City of Medicine Hat has been extremely positive since the project’s inception back in 2016 and it’s rewarding to see that this project now has the potential to contribute to the City’s energy transition, whilst providing low-cost renewable energy to its residents,” says Damian Bettles, Head of Development for DP Energy in Canada.

Through negotiating a purchase and sale agreement, multiple conditions and internal processes must be satisfied before the City can consider developing the solar field, not the least of which is provincial approval, along with Council approval and financing.

Rochelle Pancoast, Managing Director of Energy, Land and Environment with the City of Medicine Hat, clarifies that the City is not immediately building a solar array. “Any decision on investing in new generation assets is subject to Council approval. Today, we are taking steps to acquire the opportunity, and all the associated approvals and engineering that have taken place thus far.”

The proposed Saamis Solar Park lies on 1,600 acres in the City’s north and is considered a productive use of vacant contaminated lands from the former Westco Fertilizer plant and property not yet ready for longer term urban/residential development. Medicine Hat is suited for solar electricity generation given its abundant solar resource.

If approved, the City intends to construct the project in phases to accommodate affordability, manage grid congestion, consider stakeholder needs, and acquire learnings before proceeding to the next phase. The project will diversify the City’s current 299 MW gas-fired electric generation portfolio by adding large-scale renewable energy into the mix.

“We are facing challenges of energy transition and emission-reduction targets. Staff are hard at work each day modelling solutions that could be viable in complying with clean energy regulations while meeting the needs of our community and continuing to deliver the advantage of our electric utility,” adds Pancoast. “We can no longer ‘wait and see’ and must actively plan for the future. In this case, solar energy is a commercially viable option that is forecast to benefit our bottom line.”

Pancoast also describes how City officials expect the Saamis Solar Park to contribute to the local economy in the form of construction jobs and being able to satisfy a growing customer interest in green energy.

“Amongst the many benefits of gaining control of this project is that electricity generated from the solar field will flow to the City’s distribution grid, rather than bypassing to the Alberta grid as originally planned, bolstering our local energy supply. Having green power to offer can help attract and retain carbon-intensive industry and other investment, as well as reduce our own carbon compliance costs.”

Green energy sources, such as wind, solar, and hydro, produce little to no greenhouse gases, helping to reduce overall carbon emissions from the City’s electricity generation portfolio. For reference, every 25 MW of solar electricity has potential to offset 21,000 tonnes of carbon dioxide annually compared to gas-fired generation, saving the City $1.5 million in carbon compliance costs at today’s levy. That amount grows to $2.4 million per year once carbon levies reach $125/tonne in 2027.

The City of Medicine Hat first awarded a development permit (permitted use) for the project to DP Energy in 2019.

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