In 2006, the Government of Alberta committed to a nine-point bioenergy plan that included three bioenergy grant programs to encourage investment in bioenergy production in Alberta and to develop Alberta’s biofuel capacity and infrastructure for biofuel products distribution. Subsequently, in 2008, the government released its climate change strategy, which identified expanding the use of renewable energy sources and developing new bioenergy products in Alberta as a key component of meeting the province’s emissions reduction targets.

In 2008, we audited the biorefining and infrastructure bioenergy grant programs administered by the Department of Energy. The credit program was not included as part of the original audit. Alberta’s Bioenergy Policy Framework requires an assessment of the environmental impact of bioenergy products from projects that receive grants. We found that the grant applications for the biorefining and infrastructure programs did not provide any environmental impact information and the department’s criteria for evaluating the projects did not include an assessment of the environmental impact. We made a three-part recommendation to the department in our October 2008 report.

What we examined

We assessed the bioenergy program systems in place to ensure that sufficient information is gathered from grant applicants and recipients to quantify positive environmental impacts—primarily carbon dioxide emissions.

What we found

While the department had taken initial steps to make improvements, we found that it had not implemented our recommendation. It still did not require biorefining and infrastructure grant applicants to demonstrate their product’s positive environmental impact relative to comparable non-renewable energy products. Also, we found that the department’s decision to fund projects under the two programs was not well documented. We are not repeating the original recommendation, since the two grant programs that were part of the 2008 audit are no longer accepting applications. However, based on the evidence gathered to follow up on the original recommendation, we identified areas in which the department could improve the ongoing credit program and the ongoing reports it requires for the biorefining and infrastructure programs, as they relate to emission reductions.

Why is this important to Albertans

Bioenergy is considered one of the elements within the climate change strategy that will assist in reducing emissions. If the bioenergy projects the government funds do not reduce emissions as expected, the government may have to reduce emissions in other areas to achieve its targets. Since the inception of the bioenergy programs in 2006 up until March 31, 2012, the Department of Energy has awarded bioenergy grants totalling approximately $200 million.

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