Pembina Pipeline Corp., alongside Morgan Stanley Infrastructure Partners and Kineticor Asset Management, has approved the Greenlight Electricity Centre, a natural gas facility designed to cater to a data center client. The project is anticipated to cost around $4.6 billion and will involve the construction of a 932-megawatt plant in Sturgeon County, situated in Alberta’s Industrial Heartland region to the north of Edmonton. The aim is to commence operations by the latter half of 2030, with provisions in place for potential capacity expansion in the future.
The surge in artificial intelligence and cloud computing has led to a significant increase in the demand for data centers, which house the necessary computer hardware for various tech applications. While the specific data center client has not been disclosed by the province and the collaborating companies, the development reflects Alberta’s efforts to attract major tech players like Meta and Google.
Alberta is actively pursuing hyperscale developers, but its current electrical grid lacks sufficient capacity to support multiple large projects simultaneously. Hence, the focus is on projects that can either establish their own power generation or enter into power purchase agreements. Premier Danielle Smith emphasized the importance of this strategy during a recent press briefing, noting that by having data centers contribute to their power infrastructure costs, it can lead to reduced transmission expenses for Alberta residents.
The successful realization of the Greenlight Electricity Centre was made possible through a comprehensive energy agreement signed between the federal government and Alberta in November. This agreement included the suspension of federal clean electricity regulations, which were perceived to potentially raise costs and compromise the reliability of a grid heavily reliant on natural gas. Premier Smith highlighted the positive impact of this accord on Alberta’s energy sector, enabling increased oil and gas production and attracting substantial investments for economic growth.
Pembina’s CEO, Scott Burrows, commended Alberta’s conducive environment for projects like the Greenlight Electricity Centre, attributing the province’s focus on competitiveness, investment attraction, and energy development as instrumental in positioning Alberta as an appealing location for emerging industries. The initiative is seen as a pioneering step in meeting the escalating power demands of large-scale data centers and establishing the necessary infrastructure to support this rapidly expanding sector.
While concerns have been raised in some Canadian and U.S. communities regarding pollution and noise stemming from data center projects, particularly those incorporating gas plants, Premier Smith affirmed that the Greenlight facility will be situated in an area accustomed to industrial development and with significant distance from residential areas.
The Pembina Institute, an independent clean-energy think tank, pointed out that while the Greenlight Energy Centre project is significant, it missed an opportunity to leverage cost-effective renewable energy sources amidst the escalating expenses associated with gas-fired power. The institute’s electricity program director, David Pickup, highlighted the limitations of Alberta’s current “bring your own generation” regulations for data centers, stressing the benefits of a diversified energy mix to mitigate environmental impacts and costs linked to gas-fired power generation.