Enforcement – Contraventions
In this decision, the AUC determined that Green Block Mining Corp. (“Green Block”), formerly known as Link Global Technologies Inc., contravened the Hydro and Electric Energy Act (“HEEA”) and Rule 007: Applications for Power Plants, Substations, Transmission Lines, Industrial System Designations, Hydro Developments and Gas Utility Pipelines when it began operating the Westlock Power Plant without AUC approval.
AUC enforcement proceedings typically have two phases. In the first phase, enforcement staff have the burden of proving allegations set out in their enforcement application on a balance of probabilities. If an allegation in the first phase is proven, the proceeding moves to the second phase, where a penalty is determined.
Green Block began operating three power plants (its Sturgeon, Kirkwall, and Westlock power plants) in Alberta in 2019-2020 without obtaining approval from the AUC. A first phase (Phase 1) decision was previously issued in this proceeding, in which the AUC determined that Green Block operated its Sturgeon and Kirkwall power plants in contravention of the HEEA and Rule 007.
The AUC reopened Phase 1 of the Enforcement proceeding to re-examine the own-use issue in light of Green Block’s new information. The AUC combined the reopened Phase proceeding with a new proceeding to consider new enforcement staff allegations relating to the Westlock Power Plant. The enforcement staff alleged that Green Block operated the Westlock Power Plant contrary to the HEEA and Rule 007 (“Contravention 1”). Enforcement staff also alleged that Green Block concealed its actions, impeding the AUC’s ability to effectively and efficiently regulate in the public interest (“Contravention 2”).
In a later ruling, the AUC accepted the proposal from the enforcement staff to withdraw the allegations regarding Contravention 2. As a result of the withdrawal, the only remaining issue was if Green Block operated the Westlock Power Plant contrary to the HEEA.
Did Green Block Operate the Westlock Power Plant Contrary to the HEEA and Rule 007?
The Westlock Power Plant is a facility comprised of six 1.475-megawatt gas generators in Westlock County, Alberta, which supply power to a set of computers used to mine bitcoins. Green Block began operating the Westlock Power Plant on March 10, 2021.
At the time of this alleged contravention, there was an exemption from the general requirement to obtain AUC approval of a Power Plant under s. 13 of the HEEA and Rule 007 in force. The exemption applied to power plants generating electric energy solely for a person’s own use provided the power plant met certain requirements to ensure that it was operated in regulatory compliance.
Green Block admitted that it did not ensure that the Westlock Power Plant complied with Rule 012: Noise Control before operating. Green Block also admitted that it did not ensure that the Westlock Power Plant would not have adverse environmental effects. Accordingly, Green Block failed to take any steps to ensure that the Westlock Power Plant was in regulatory compliance.
The AUC accepted the admissions and found that Green Block was in contravention of the HEEA and Rule 007. The AUC will consider sanctions in the second phase of this proceeding.