Facilities – Consultation
Mojek Resources Inc. (“Mojek”) applied for approval to construct and operate a 96-megawatt natural gas-fired power plant designated as the Gage Bitcoin Mine Power Plant (the “Power Plant”). The application indicated that the Power Plant would be constructed within the existing Gage battery site in the Municipal District of Fairview No. 136 (the “Municipality”).
The AUC denied Mojek’s application because it determined that it did not meet the participant involvement program requirements under Rule 007: Applications for Power Plants, Substations, Transmission Lines, Industrial System Designations, Hydro Developments and Gas Utility Pipelines (“Rule 007”) and that the proposed Power Plant was not eligible for the exemption under s 2(1)(b) of the Electric Utilities Act (”EUA”).
Alberta Utilities Commission Act, SA 2007, c A-37.2.
Electric Utilities Act, SA 2003, c E-5.1.
Hydro and Electric Energy Act, RSA 2000, c H-16.
AUC Rule 012: Noise Control.
Following the notice of application filed by the AUC, the Municipality filed a statement of intent to participate. The Municipality raised concerns regarding noise mitigation, the requirement to obtain a development permit and a road use agreement, and outstanding municipal taxes. While the AUC denied the Municipality standing, it was allowed to file written submissions outlining its concerns.
Mojek’s Participant Involvement Program
The AUC reviewed the application filed by Mojek and determined that approval would not be in the public interest. The AUC denied the application to construct and operate the Power Plant because Mojek’s application did not meet the participant involvement program requirements under Rule 007 and because Mojek did not establish that the Power Plant qualifies for exemption under s 2(1)(b) of the EUA.
To meet the requirements of Rule 007, Mojek was required to provide personal notification to stakeholders within 2,000 meters of the edge of the Power Plant and conduct personal consultation with stakeholders within 800 meters of the Power Plant. Mojek failed to conduct personal consultations with stakeholders, as required by Rule 007.
Mojek failed to actively consult with potential stakeholders other than the Municipality, within 800 meters of the Power Plant. Mojek advised that it provided the notification package to these stakeholders but that no feedback was received in response to its participant involvement program materials. Mojek did not take any further steps to engage with and consult with these stakeholders as required under Rule 007.
Further, Mojek’s notification materials did not contain the minimum information prescribed by Rule 007, including comprehensive information about the general nature of the potential impacts of the Power Plant.
The AUC determined that stakeholders were not afforded a meaningful opportunity to understand the potential impacts of the Power Plant and raise any concerns.
Section 2(1)(b) of the Electric Utilities Act
S 2(1)(b) of the EUA provides an exemption from the EUA for “electric energy produced on the property of which a person is an owner or a tenant, and consumed solely by that person and solely on that property.” If the conditions of s 2(1)(b) are not met, the owner of the bitcoin mine is obliged to take electricity from the Alberta Interconnected Electric System and the owner of the Power Plant is obliged to exchange the electric energy through the power pool.
The application filed by Mojek indicated that the requirements of s 2(1)(b) of the EUA would be met as the Power Plant would not be connected to the Alberta Interconnected Electrical System, and Mojek would be the owner and operator of the Power Plant and the Bitcoin Mine. However, during the oral hearing of this proceeding, Black Powder Inc., Mojek’s management consultant, provided contradictory evidence. Submissions from Black Powder Inc. indicated that a third party would own and operate the bitcoin mine at the Power Plant site and consume the electric energy produced by Mojek. Upon request from the AUC, Mojek confirmed this information.
The AUC therefore determined that the exemption requirements were not met.
Municipal District of Fairview No. 136 Submissions
The AUC noted that, at the time of this proceeding, the tax balance outstanding by Mojek was significant, representing five percent of the Municipality’s revenue. It said that Mojek had made no payments since 2018. The AUC acknowledged Mojek’s intent to repay its taxes by December 2023 under a Municipal Tax Payment Plan. However, the AUC saw no evidence of Mojek’s financial ability to repay the taxes or payments made to the Municipality under the Municipal Tax Payment Plan. In addition to the outstanding taxes, the AUC had concerns with Mojek’s non-compliance history with the AER, resulting in the AER taking over Mojek’s assets in multiple cases. In considering whether the current application met the public interest test, the AUC would have benefitted from evidence from Mojek establishing a stronger track record of proactively addressing both its tax liability with the Municipality and its non-compliance history with the AER.
The AUC denied Mojek’s application without prejudice to any future application in which Mojek proposes to construct and operate the Power Plant, provided the future application meets the requirements of the applicable legislation, regulations, and rules.