Newfoundland and Labrador Plans to Collect Royalties from Nascent Renewable Energy Industry
Key Ideas
  • Newfoundland and Labrador government plans to collect royalties from proposed wind-powered hydrogen projects on Crown land, even if companies pivot to focus exclusively on wind energy.
  • Despite challenges in the green hydrogen market, the province remains optimistic about the wind-to-hydrogen sector, with one $16-billion project already cleared through the environmental assessment process.
  • Six companies have reserved Crown land for green hydrogen projects, but some are behind on fees. Discussions on royalties and benefits will take place during the upcoming renewable energy expression of interest process led by N.L. Hydro.
  • Minister Crocker emphasizes the importance of ensuring any deviations from the wind-to-hydrogen plans are approved by the provincial government to protect Newfoundland and Labrador's resources.
Amid a lagging market for green hydrogen, the government of Newfoundland and Labrador is steadfast in its decision to collect royalties from the province's emerging renewable energy industry. The Minister of Industry, Energy, and Technology, Steve Crocker, affirms that the government will monitor industry developments closely and establish an appropriate royalty regime if the proposed wind-powered hydrogen projects shift focus solely to wind energy. A fiscal framework is already in place to ensure the collection of royalties and benefits from projects on Crown land using wind power to produce hydrogen. Despite facing challenges in securing agreements with buyers, six companies have earmarked Crown land for green hydrogen initiatives in the province. While some companies are reportedly behind on fees owed to the government, a positive outlook remains for the wind-to-hydrogen sector. Newfoundland and Labrador Hydro is set to launch an expression of interest for renewable energy soon, during which discussions on royalties and benefits will occur. Minister Crocker highlights the significance of obtaining formal approval from the government for any deviations from the original wind-to-hydrogen plans to safeguard the province's resources. With one major project already clearing the environmental assessment process and others in progress, the government anticipates growth in the wind-to-hydrogen sector. The province's commitment to leveraging its resources for renewable energy underscores its proactive approach to sustainable energy development.
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