Alberta stands at a critical juncture in its energy history. As the Western Canadian province transitions from coal-fired power to renewable energy generation while experiencing unprecedented population and industrial growth, the Alberta Electric System Operator (AESO), a not-for-profit government agency, has unveiled an ambitious CAD7.12 billion transmission infrastructure plan that will fundamentally reshape how electricity moves across the province over the next two decades.

Released in January 2025, the AESO’s Long-Term Transmission Plan (LTP), which has been developed through extensive public consultation, addresses mounting challenges from ageing infrastructure, growing electricity demands, and the integration of intermittent renewable energy generation that has dramatically altered the province’s power landscape since the phase-out of coal generation in 2024.

Prepared every two years, the LTP uses scenarios to assess transmission needs across two distinct timeframes: detailed near-term analysis covering the next five years of the transmission system (69 kV and above) for high confidence regional developments, and longer-term system-wide planning which covers the next 6-20 years focusing on bulk transmission requirements (240 kV and 500 kV). When necessary developments are identified, the AESO prepares and files the Needs Identification Document (NID) with the Alberta Utilities Commission for project approval. Once approved, the designated transmission facility owners (TFOs), which develop and operate transmission infrastructure in Alberta, handle the detailed work of siting, routing, constructing, operating, and maintaining the actual transmission facilities. The primary TFOs — AltaLink Management Limited, ATCO Electric Limited, ENMAX Power Corporation and EPCOR Distribution and Transmission Inc. — serve distinct regions across Alberta.

The latest LTP (2025) addresses mounting pressures that are rapidly reshaping the province’s electricity landscape. The province is transitioning from a “zero congestion” planning standard — which requires the system to handle 100 per cent of anticipated electricity flows — to an “optimal transmission planning” framework that emphasises economic efficiency and cost causation principles. Enhanced intertie connections with neighbouring provinces offer new opportunities for power sharing and grid stability, while the AESO explores non-wire alternatives — including grid-forming battery energy storage systems (BESS), dynamic line rating (DLR) technologies, and power flow control systems — that could complement traditional infrastructure investments.

This article examines how Alberta built its current grid around coal-fired generation, the infrastructure projects already underway, and the AESO’s three-pronged approach to future development. The LTP sets out transmission plans that are grouped by load-driven projects to ensure reliable service to growing communities, generation-driven investments to manage renewable energy integration, and intertie enhancements to strengthen Alberta’s connections with broader regional markets. The plan also acknowledges emerging challenges from grid reliability concerns and massive data centre proposals, while exploring innovative technologies that could reshape how transmission systems operate in the decades ahead.

Alberta’s grid revolution from coal to renewables

Alberta’s transmission system has undergone a dramatic transformation, particularly over the past decade. For over half a century, the province’s electricity grid was built around a simple north-to-south paradigm of power generation and distribution.

Figure 1: Existing transmission system of Alberta

Source: AEMO LTP 2025

Built in the 1950s around Edmonton’s Wabamun Lake area, the transmission system centred on abundant coal resources. The region hosted roughly 4,500 MW of coal-based generation, one of Canada’s most concentrated thermal hubs, supported by the sophisticated 500 kV Keephills–Ellerslie–Genesee (KEG) loop system. A robust 240 kV network connected Calgary, Red Deer, and Edmonton, functioning like a massive one-way highway transferring excess electricity southward from Edmonton’s coal plants.

This coal-based paradigm began shifting in the 1990s as southern Alberta emerged as a renewable energy hub. The transition gained momentum through the 2000s as ageing assets, poor economics, and federal environmental rules put pressure on the coal fleet. The game-changing moment came in 2015 with two 500 kV high voltage direct current (HVDC) lines — the Eastern and Western Alberta Transmission Lines — enabling bi-directional power transfers of up to 1,000 MW between Edmonton and Calgary.

Southern Alberta simultaneously developed extensive 240 kV networks for wind and solar access, including the Southern Alberta Transmission Reinforcement (SATR) from Windy Flats to Foothills and the Foothills Area Transmission Development (FATD). Alberta maintained strategic connections with neighbours through three interties: the Alberta–British Columbia (BC) connection (a 500 kV main line plus two 138 kV elements), the 230 kV Montana–Alberta Tie Line (MATL), and the 150 MW Alberta–Saskatchewan HVDC interconnection.

The transformation culminated in 2024 with the retirement of Alberta’s entire coal fleet — the last coal plant went offline in June 2024 — driven partly by the federal government’s Clean Electricity Regulations (CER), which establishes emission limits for electricity generators as part of Canada’s strategy to achieve net zero by 2050.

Grid projects in development

Even as the AESO develops its ambitious long-term vision, the transformation is already underway. Several major transmission projects approved through the NID process are currently at various stages of development, representing critical stepping stones towards the grid of the future. These projects address immediate pressures while laying groundwork for the larger transformation ahead.

Scenario development

The emergence of extensive wind and solar installations has created bidirectional power flows on the transmission system. This has created new operational complexities and reliability challenges. Particularly, ageing transmission infrastructure has become an increasingly pressing issue, with equipment that was designed for predictable power flows now managing complex, variable patterns. The grid must handle more unpredictable power flows while maintaining the strict reliability standards.

In this rapidly evolving energy landscape, the AESO has developed four distinct scenarios to capture the full range of possibilities Alberta might face.

The Reference Case serves as the base scenario for the AESO’s transmission planning assessment. The LTO Reference Case projects that peak load growth will average an annual rate of 1.4 per cent over the next 20 years.

AESO LTP 2025 transmission projects

The AESO’s LTP categorises transmission needs into three distinct parts, each addressing different aspects of the province’s evolving electricity system:

Load-driven development: Load-driven transmission plans, worth CAD1.8 billion, focus on ensuring Albertans’ electricity needs are met reliably. Of the total, over the next five years, CAD 965 million will be invested in areas where load growth — whether from population increase, industrial expansion, or emerging sectors such as data centres — threatens to outpace the existing transmission capacity.

Generation-driven development: Alberta’s generation-driven transmission plans, worth CAD4.6 billion, address congestion caused by the province’s evolving electricity mix. Developed under a “zero congestion” standard, these projects ensure renewable power reaches consumers without bottlenecks, but this is set to change. In July 2024, the government adopted an OTP framework, under which projects must meet reliability needs and deliver economic benefits. As per the OTP framework, cost allocation will shift, and all costs borne by consumers and new generators will contribute towards transmission infrastructure costs through an upfront and non-refundable transmission reinforcement payment (TRP) mechanism. The TRP will replace the current Generating Unit Owner’s Contribution (GUOC) regime. The AESO plans to develop OTP rules through 2025-26, with implementation beginning in 2027. However, this is likely to create uncertainty for the identified generation-driven portfolio due to delays or reprioritisation under the new model.

Intertie-driven development: Alberta’s connections with neighbouring jurisdictions have become increasingly crucial for balancing renewable energy generation. Intertie-driven transmission plans, worth CAD750 million, respond directly to recent policy directions on advancing a restructured energy market (REM). These include restoring the Alberta–BC intertie to near 950 MW capacity, maintaining high levels of ancillary services to support full import flows on both the BC connection and the MATL, and increasing the Alberta–Saskatchewan intertie’s capacity as part of equipment replacement projects.

Figure 2: Location of upcoming transmission projects

Source: AEMO LTP 2025

Note: *NID for the project was approved in September 2024 and is under development; ^The projects will replace ageing infrastructure; #The project will help manage inflow constraints
Source: AEMO LTP 2025

The AESO estimates that transmission costs, currently at CAD43 per MWh, will rise by over 9 per cent to CAD47 per MWh by 2029. If all proposed generation-driven projects proceed, costs could reach CAD58 per MWh by 2045 — a 35 per cent increase driven by extensive network reinforcements and the capital requirements of new infrastructure.

Emerging technology options and non-wires solutions

The transmission plan clearly acknowledges that emerging technologies can complement traditional infrastructure approaches while potentially reducing overall system costs. The AESO has been actively piloting and evaluating various technological solutions that can transform the way the grid operates and expand its capabilities without requiring proportional infrastructure investment.

To manage transmission rates effectively while addressing growing demand, the AESO is implementing a variety of optimisation and funding strategies:

  • Deploy advanced power flow control devices: In September 2022, a modular power flow controller pilot on Fincastle’s 138 kV line demonstrated how fine-tuning reactance can shift flows away from congested corridors — delivering immediate relief without new towers or right-of-way (ROW).
  • Unlock extra capacity with DLRs: By feeding real-time weather data into lines such as 7L128 (144 kV Coyote Lake–Michichi Creek) and 924L/927L (240 kV Milo–Langdon), the AESO safely enhances thermal limits under favourable conditions, deferring traditional cost hike.
  • Integrate grid-forming BESS for multi-service value: Next-generation BESS installations are being tested not just for energy storage and dispatch, but also for supplying inertia, voltage support, fast-acting congestion relief and system-strength enhancements.
  • Extend system flexibility via remedial action schemes: : The AESO currently operates over 60 automated protection schemes that trip generation or load to maintain system security. It continues to improve these remedial action schemes (RAS) to maximise capacity from the existing network. By automatically detecting critical conditions, the system can take corrective actions, such as tripping generation or load, to ensure reliability.
  • Formalise non-wires alternatives in planning: Under the 2024 grid-modernisation amendment, distributed resources, such as demand response and behind-the-meter storage, can now compete with wires solutions, allowing the AESO to address peak constraints with lower-cost, market-based options.
  • Leverage federal funding and incentives: By tapping into programmes, such as the Smart Renewables and Electrification Pathways, and partnering with the Canada Infrastructure Bank, the AESO can offset capital outlays on critical projects. This approach can help in keeping rate impacts to a minimum.

While these technologies represent the grid’s evolution towards more intelligent and responsive systems that maximise existing asset value, their increasing complexity poses management challenges. If these challenges become unmanageable from a reliability perspective, it may necessitate transmission development.

Navigating Alberta’s energy future

The AESO’s strategy for implementing this transmission plan takes into account the challenges that may impact its execution. Ongoing advancements in technology are continuously reshaping the economics and capabilities of both generation and transmission solutions. The transition to OTP will fundamentally change project evaluation criteria and cost allocation mechanisms. Further, the actual pace of development of proposed data centres and industrial loads is highly uncertain, as is the overall economic environment influencing provincial growth trajectories.

Beyond these planning uncertainties, the AESO faces two key challenges that could fundamentally reshape Alberta’s electrical landscape. The province’s swift transition to renewables has created unprecedented technical complexities that could threaten grid stability. As Alberta’s generation fleet increasingly relies on wind and solar power, the power system’s frequency response, system strength, and operational flexibility have diminished. To address these issues, the AESO has outlined comprehensive solutions in its recently released 2025 Reliability Requirements Roadmap, which is aligned with the renewable energy market. These solutions include fast frequency response technologies, synchronous condensers, and grid-forming BESS.

Alberta also faces an unprecedented data centre boom. In 2024, projects over 8,600 MW in capacity submitted connection applications, representing massive, discrete loads concentrated in specific geographic locations that present fundamentally different challenges from distributed residential growth. Since these projects are in their early development stages, the 2025 LTP does not include transmission plans for these potential energy loads. However, the AESO is developing location-based capability maps and reviewing regulatory frameworks to ensure reliable integration of these loads.

The successful implementation of the transmission plan will directly influence Alberta’s ability to attract investment across multiple sectors. Renewable energy developers require confidence in transmission access, data centre operators need assurance of reliable service, and industrial facilities consider electrical infrastructure capability as a critical factor in their decision-making. The investments outlined in the 2025 LTP establish essential foundations for Alberta’s energy transformation, fundamentally shaping the province’s electricity landscape for decades to come.