All eyes on RAS NEW OPPORTUNITIES FOR SASKATCHEWAN BUSINESSES TO BUY RENEWABLE ELECTRICITY BY CHRISTOPHER J. MASICH, MCKERCHER LLP PARTNER, AND TYSON ACOOSE, MCKERCHER ASSOCIATE
RAS stands for Renewable Access Service, which is SaskPower’s new program that will allow participating companies to purchase clean electricity directly from qualified Independent Power Producers. Potash companies and other industrial companies who aspire to achieve environmental, social and governance (ESG) goals should be excited, or at least curious about SaskPower’s RAS program. Why? Because RAS will allow companies operating in Saskatchewan (customers) to buy electricity directly from Independent Power Producers (IPPs) instead of SaskPower. In doing so, customers will have certainty that their electricity is from a renewable source rather than from a mix of SaskPower’s various fuel sources – coal (24 per cent), natural gas (40 per cent), renewables (34 per cent), and other (two per cent). In doing so, customers ensure their electricity use aligns with their corporate ESG goals and sustainability objectives by determining how their electricity is generated,
58 PotashWorks 2024
who they buy from, and securing environmental attributes to offset their carbon emissions from other industrial operations. On the same note, customers determined to promote Indigenous partnerships may, through carefully crafted project ownership structures and other project agreements, encourage or require IPPs to involve Indigenous groups in projects through equity, contracting, or employment opportunities. In stark contrast, companies that do not participate in RAS will have no say in how, where, or who their electricity is sourced from, nor secure the environmental attributes produced from renewable generation when purchasing electricity under conventional SaskPower utility accounts. Effectively, a renewable energy project qualified under RAS, whether it be solar or wind, is developed for the primary purpose of supplying clean electricity to carbon-intense customeroperated sites, which may include mines, oil and gas refineries, or manufacturing sites. In simple
terms, the IPP will generate and then transmit electricity through SaskPower’s grid (for a fee via Intra-Provincial Transmission Tariff) to the customer’s site for consumption. This arrangement will be documented in a corporate power purchase agreement (CPPA, but it also goes by other names). From a legal perspective, the CPPA typically hinges on several critical terms that are essential for a clear and enforceable contract, the most important being pricing and performance guarantees, duration and termination events, as well as construction, commissioning, and force majeure events. Under RAS and Saskatchewan carbon regulation, other issues also require careful consideration, namely the creation, ownership, and transferability of environmental credits or attributes, load matching, and curtailment. Addressing both load matching and curtailment, and mitigating associated risks will be essential, in addition to managing and mitigating the usual regulatory, permitting, construction, and financing risks.