With signs that the global expansion of renewables is stalling amid grid capacity and investment challenges, Alberta is bucking the trend and meeting carbon-reduction targets ahead of schedule with a practical and realistic approach.
As an example, in 2016, the province took forward-thinking steps by enacting the Renewable Electricity Act. The legislation requires Alberta to have 30% of its electricity produced by renewables by 2030.
This ambition was notable. As recently as 2017, coal-fired generation, including dual-fuel assets, produced 59% of Alberta’s electricity. Since 2017, significant progress has been realised with Alberta closing its final coal power plant in 2024, six years ahead of schedule. This type of strategic approach is setting Alberta apart.
Strategic priorities for Alberta’s renewable energy goals
The main focuses for energy supply in Alberta are affordability and reliability, with capacity for large industrial loads that require power 24/7. Furthermore, with data centres set to be a major area of industry growth in Alberta, having the capacity to accommodate energy-intensive installations will be essential. As of 15 December 2025, there is nearly 20GW of data centre load requesting a grid connection. Considering peak demand in the province is currently just over 12GW, an additional 20GW will not be possible without expanding electricity generation.
According to December 2025 figures from the Alberta Electric System Operator (AESO), if all 164 projects in development proceed as planned, they will deliver a combined capacity of 24GW across 14 different types of energy generation. Within the total number of projects, solar leads, followed by combined solar and storage.
The diverse mix of technologies is central to grid reliability in the province, with renewables supporting decarbonisation and affordability. What sets Alberta apart from other regions is that the provincial government lets the market decide what technologies to invest in. Operating a deregulated electricity market creates competition that focuses on value, driven by supply and demand dynamics.
“Our market enables consumers of energy – be it data centres, oil and gas or other heavy industry – to be creative and come up with solutions that work well for their business objectives,” says Stacie Lara, Director of Investment in energy at Invest Alberta. “The market is really an enabler of private sector solutions and the ability to try new technologies,” she adds.
Unlike many other Canadian provinces, Alberta does not have hydro power to deliver the majority of its electricity. Yet the province is called Canada’s energy capital for a reason, as it supplies 84% of the country’s crude oil and 65% of its natural gas. To achieve Alberta’s ambition for a carbon-neutral oil and gas industry by 2050, carbon capture, utilisation, and storage (CCUS) is integral.
Already, the province features two operational CCUS projects – the Shell Quest project and the Alberta Carbon Trunk Line, which has the capacity to transport 14.6 million tonnes of CO₂ annually, with an additional total of 32 CCUS projects at various stages of development in the province.
In an example of how the Alberta market inspires innovation, Deep Sky Alpha is a direct-air carbon capture facility powered by solar electricity. The success of such projects could lead the way for direct-air capture technologies globally.
How the renewables portfolio complements Alberta’s oil and gas sector
With the oil and gas industry crucial to Alberta’s economy, the renewables portfolio can complement and support the sector to help achieve the province’s carbon-neutrality target by 2050.
As more renewables are introduced to the grid, it will allow oil and gas companies to access clean electricity to reduce their Scope 2 emissions. Given Alberta’s carbon levy, using renewables also offers heavy emitters an opportunity to offset their industrial emissions and reduce their tax bill.
Another appealing option for renewables investors in Alberta has been the option to enter virtual power purchase agreements (VPPAs) to offset emissions from other locations around the world. Over the last five years, the VPPAs initiative has positioned Alberta as a leading destination in Canada for renewables investments. Companies with corporate VPPAs include Amazon, Budweiser, and TD. These agreements have created wind and solar projects with a combined estimated capacity of 770MW.
Renewables projects in Alberta
It was estimated that Alberta had an existing capacity of 7.5GW of solar and wind installations at the end of 2024. Included in this capacity are some considerable renewable projects such as the 465MW Traverse project, which is the largest solar farm in Canada.
Indigenous communities are integral partners in renewables investments in Alberta, with Alberta being the first province in Canada to introduce an initiative dedicated to sharing economic opportunities. Alberta Indigenous Opportunities Corporation (AIOC) enables Indigenous communities to access funding through loan guarantees.
“Our Indigenous communities in Alberta have really been at the forefront of investing in resource-based projects, including investment in renewable projects,” adds Lara.
Another key aspect of Alberta’s renewables strategy is to protect the pristine landscapes and prime agricultural land of the province. Laws were passed in 2024 that restrict the sites for renewables development to strategically defined locations, respecting Alberta’s natural heritage. Along with energy security, food security is of strategic importance to future growth plans in Alberta.
Energy storage developments in Alberta
With storage being one of the traditional challenges with intermittent renewable energy, this is being addressed in Alberta with around 30 market-driven battery projects in development.
“Reliability and affordability are top priorities,” adds Lara. “We need to balance that with what renewables brings, which is intermittency. If renewables can be firmed up with battery storage technologies, and as we see long-duration energy storage technologies commercialise and proven, that could support further growth of renewables here.”
Beyond solar and renewables, geothermal energy offers considerable potential in Alberta for electricity generation. With resources located deep underground, the Alberta Government is investing in a multi-million-dollar drilling accelerator programme to support the geothermal industry and commercialise new technologies. Separately, Alberta’s mature asset strategy is targeted at the potential of repurposing depleted or abandoned oil and gas wells for geothermal or other industries. In addition, there are two innovative projects in development that involve compressed air storage.
“We’re welcoming creativity and innovations to unlock the potential in old and new technologies and resources,” adds Lara.
Investment in Alberta renewables
Alberta offers a crucial opportunity to develop and prove energy generation technologies. If innovations succeed in Alberta’s competitive market, it is a strong sign that such technologies are commercially viable in other markets.
The innovation, expertise, and business-friendly policy framework for energy innovation in Alberta has attracted attention from investors internationally and domestically.
In recognition of Alberta’s leadership in core industries, the provincial government has recently signed a memorandum of understanding with the Canadian Government to bolster collaboration in energy and establish a more competitive and sustainable economy. The document features several references to CCUS and data centres.
Along with the established industrial expertise, Alberta possesses the youngest working age population in Canada to support future growth. Alberta’s universities offer access to the brightest minds in academia to further industrial innovations on projects, along with highly qualified graduates at the start of their careers.
“We’re seeing just incredible growth in terms of the demand curves. We are a place that welcomes investment,” adds Lara. “We enable investment for energy innovation. This is a great place to invest and develop energy projects.”
To learn how Alberta is tackling the challenges with energy demand for data centres and the role of renewables and CCUS in the decarbonisation drive, download the document below.
