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.
Objective and Scope
Our audit objective was to determine whether the department had a system in place to assess the environmental impact of the bioenergy projects funded by the program and whether the impact is less than or equal to that of existing energy products. This objective included following up on whether the department implemented our 2008 recommendation. To conduct this audit, we:
- interviewed department staff and members of the grant review committees for the biorefining and infrastructure programs
- examined a sample of applications and supporting documents for bioenergy biorefining and infrastructure grants
- reviewed the department’s requirements for reporting environmental benefits by the grant recipient
- examined a sample of reports from grant recipients in all three programs
- examined the department’s processes for tracking and reporting emission reductions from projects funded in all three programs
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.