A new startup in Alberta’s deregulated electricity market will begin trading on the Canadian Venture Exchange by mid-September.
First Canadian Electric, which expects to complete its $6-million IPO later this week, says it plans to capitalize on the market niche created in Alberta’s deregulated power market.
“We’re certainly not going to see the wild returns that we would have had we been generating last year,” acknowledged Nick Colvin, vice-president of business development for the Calgary-based company.
“But we did all of our projections on what they call the $30 spark spread, which is the difference between the price of the fuel and the power output. . . .
“We’re still within the range where our company will still see 35- to 40-per-cent return on our equity.”
Colvin said the small company is examining approximately 200 megawatts of project opportunities.
It has partnered with Canadian Gas and Electric Company Ltd., a wholly owned subsidiary of Canadian Hydro Developers Inc., to develop the gas-fired Drywood Power Station project south of Pincher Creek.
Colvin said FCE also has an interest in developing biomass projects. “One of the projects we’re developing is a 25-megawatt project that is fuelled by wastewood, demolition and construction waste. We’re hoping to get that one under way in mid-September, IPO gods willing,” he added.
Meanwhile, PanCanadian Petroleum Ltd. has announced that the first of its Alberta power plants, the Cavalier Power Station, is now selling electricity to the Alberta Power Pool.
It marks the first time the company has produced and sold electricity commercially in Alberta, said Nancy Laird, senior vice-president of marketing and midstream.
Construction on the plant, 55 kilometres east of Calgary and currently producing up to 85 megawatts of power, started last year.
When running at capacity, the plant will consume about 20 million cubic feet of natural gas per day.
PanCanadian has been given the green light by the National Energy Board to export electricity into the power-starved U.S., and is involved in building two other power stations: a jointly held unit at the site of their Balzac natural gas plant to be operated by Nexen, and a 85-megawatt cogeneration facility in Medicine Hat.