Author: Nick Martin

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Executive Summary

Innovative technologies promise to provide goods and services better, cheaper and in ways never envisioned before. But often these technologies are ahead of the regulatory curve and stumble because the regulatory environment is designed in ways that exclude them.

One example is geothermal energy for distributed electricity production. Geothermal energy – broadly described as the natural heat of the Earth – is renewable, controllable and clean. Distributed generation – small-scale electricity production at or near where the electricity will be consumed – is reshaping how the world thinks about electricity grids. Both are relative novelties in Alberta.

With an increasing need for low-emission, reliable electricity in Alberta, geothermal energy provides a big opportunity. With its existing oil and gas industry and significant accompanying technical expertise relevant to geothermal drilling, the province is particularly well-positioned to take advantage and develop a geothermal industry.

However, Alberta’s regulatory environment is not yet adapted for both geothermal development and distributed electricity production. Without an appropriate regulatory framework, Alberta will continue to lag behind other jurisdictions in benefiting from geothermal and distributed energy resources.

This paper uses a novel geothermal electricity technology – Eavor-Loop – as a test case to understand how innovative technologies can be treated by Alberta’s regulatory environment. The findings, however, are not unique to this specific technology. They apply to any technologies seeking to use geothermal energy or to produce small-scale distributed electricity in Alberta.

Alberta’s laws do not yet regulate geothermal development – imposing significant uncertainty for would-be geothermal developers. A legal definition of geothermal resources does not exist, and it is not clear who owns them or how the rights to their development can be obtained. It is also unclear how the physical activities associated with geothermal development will be regulated. Ambiguity on these issues is holding back Alberta from developing another source of clean energy.To harness Alberta’s geothermal resources, the province must develop a legal framework that enables responsible development, provides investment clarity and that is technology agnostic, i.e., does not get in the way of the wide array and ever-changing suite of emerging geothermal technologies.

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