Micro-generation is the production of electricity on a small scale, using
renewable and alternative energy sources, typically solar and wind, by
individual home owners and small businesses, as well as municipal and community
buildings, such as a fire hall, to meet their electricity needs. Other sources
of energy include biomass, micro-cogeneration, geothermal sources, and fuel
The Regulation, established in 2008,
allows Albertans to meet their own electricity needs by generating electricity
from renewable or alternative energy sources.
Under the regulation, micro-generators receive credits for the electricity
that they produce but do not consume. Small micro-generators, sized under 150
kilowatts, are credited for the electricity sent back to the grid on a monthly
basis at their retail rates, while large micro-generators, sized 150 kilowatts
and above, are credited for the electricity sent back to the grid at the hourly
wholesale market price. Small micro-generators may also choose to install a
meter that allows them to receive credit for excess electricity based on hourly
wholesale market prices rather than retail rates.
Micro-generation systems are sized to offset all or a portion of the
customer’s electricity needs. Albertans that want to generate electricity to
earn revenue, and not for their own use, are considered commercial generators
and do not meet the requirements to be a micro-generator. Small commercial
generators may qualify as distributed generation, see the Distributed-Generation Application Guidelineor contact the Alberta Utilities Commission (AUC) directly.
Late in 2016, the Regulation was amended to provide more flexibility
for rules on how Albertans can generate their own electricity. Changes included increasing the size limit of a micro-generation system to
five megawatts from one megawatt and allowing a micro-generating system to serve
adjacent sites, which is especially helpful for operations with more than one
building. Other amendmentshelped to improve the reliability, stability,
and safety of micro-generation and the distribution grid.
In 2017, the AUC conducted a distributed generation review.
How does this affect me?
Customers are provided more choices for how to source their electricity.
The local wire service provider, also called the distribution company, looks
after connecting a micro-generator’s system. Individual micro-generators do not
have to pay for the ordinary and reasonable costs of interconnection and meter
infrastructure as these costs are shared by all customers in the distribution
company’s service area. This is monitored by the AUC to
ensure costs passed on to the customers are fair.
The customer's electricity retailer must manage the administration and
billing of the excess energy sent into the grid. This saves the micro-generator
customer direct and indirect administration costs. Credit is received for
electricity supplied to the grid, which allows customers to obtain value for
every kilowatt-hour (kWh) they generate and don’t use.
Micro-generators in Alberta
*Includes installed micro-generation systems and pending sites that have
The Alberta Electric System Operator (AESO) publishes quarterly micro-generation reports.
How do I become a micro-generator?
All customers who want to become a micro-generator must apply to their
distribution company (also known as the wire service provider) to get approval
to connect and operate a generating unit, the AUC is responsible for overseeing
and making decisions regarding the Micro-generation Regulation.
The first step in applying is to contact your distribution company to inform
them that you plan to install a micro-generation unit. The Utilities
Consumer Advocateat 310-4-UCA maintains a list of retailers and
distributorsfor Alberta. You can also find your
company on your electricity bill.
After notifying your distribution company of your intent to become a
micro-generator, there are a series of steps that must be completed. These steps
are part of the AUC’s guidelines and include, but are not limited to:
When all steps have been completed, an application may be submitted through the
AUC efiling system. The application
form is submitted to your distribution company.
Micro-generation customers are also required to sign an interconnection
agreement with the distribution company. The distribution company owns the
distribution system for your home, farm, business or industry. The distribution
system carries electricity from the provincial transmission lines to
consumers. The distribution company reviews and approves micro-generation
applications, installs meters, and provides metering data to retailers and the
Electric System Operatorfor settlement. Small
micro-generators may also choose to install a meter that allows them to receive
credit for excess electricity based on wholesale market prices rather than
You must also notify your electricity retailer to discuss the information
required by your retailer for compensation and billing. Your electricity
retailer credits you for excess electricity that you return to the grid. The
rate at which you are credited is agreed upon between you and your electricity
retailer. The government does not decide what this rate should be. Your retailer
collects from the AESO for crediting you for the excess at the same rate that
you paid when buying electricity from the grid. The way these credits flow
between you, your retailer and the AESO is described under the Micro-generation
If there is a dispute between the micro-generator and the distribution
company or retailer that cannot be resolved, it may be referred to the AUC, the
In all cases the micro-generator must prove that greenhouse gas (GHG)
emissions from the system are 418 kilograms per megawatt hour (kg/MWh) or less
of electricity and/or useful heat generated. This ensures that all
micro-generators will have lower GHGs than a typical combined cycle natural gas
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