This special interest group is for professionals to connect and discuss all types of carbon-free power alternatives, including nuclear, renewable, tidal and more.

Post

RenuWell - Transforming up to 170,000 inactive oil wells into solar farms

image credit: And early pilot project that uses solar to power oil pump jacks. Photo by Skyfire Energy
David Dodge's picture
Producer Green Energy Futures

David Dodge is the producer of Green Energy Futures, a series of more than 260 documentaries on clean energy leaders, projects and technologies from across Canada. You can see his stories at...

  • Member since 2020
  • 27 items added with 4,662 views
  • Oct 21, 2021
  • 305 views

By David Dodge and Kay Rollans

Keith Hirsche is the founder and president of RenuWell Energy Solutions, and he has a really big idea to take abandoned Alberta oil wells and turn them into solar farms.

Your access to Member Features is limited.

The idea is pretty simple. Oil companies could save on some reclamation costs of sites by retaining some of the basic infrastructure after some initial cleanup. Co-operatives or companies can then enter into new leases with the landowner and reuse this infrastructure to build solar projects on the same site.

Alberta has 170,000 inactive and abandoned oil wells and 3,321 orphan wells that have been abandoned by failed companies. It all adds up to a liability of $30.1 billion against total security held of $227 million.

There is also a growing tax liability. In a survey to its members, the Rural Municipalities Association of Alberta (RMA) found $245 million in unpaid property taxes owed by oil and gas companies by February 2021. That’s a 42 per cent increase from 2020 and a 203 per cent increase from 2019.

The solar projects could also help ease this problem: they would pay taxes to municipalities that have been losing tax revenues as oil companies abandon sites or simply stop paying their taxes due to financial pressures.

Kieth Hirsche is the founder of RenuWell that seeks to build solar projects on abandoned well sites thus reusing the site, creating new lease revenue for landowners and taxes for the municipality. Photo FB

Swapping oil for solar on the family farm

Keith Hirsche’s family still has a small farm near Taber, Alberta. Hirsche understands the economics of farming and knows first-hand the importance of oil lease revenues to farmers.

His father took a job with oil and gas to make ends meet for their farm. Hirsche himself worked in geoscience research for the oil industry for 15 years.

After his father passed away, his mother was dependent on lease payments from oil gas to keep the farm afloat.

“My mom's partly dependent on the oil and gas lease revenue for her retirement income,” says Hirsche. “I thought, well, you know, they're going to be abandoning the leases and the rental payments won't come anymore. So that's where I kind of thought this might be a good opportunity.”

Reusing the sites reduces the reclamation costs. You still have to shut the well in and clean up any messes, but you can leave the pad and the road to be reused.

He consulted with the Alberta Utilities Commission, the Alberta Energy Regulator (AER), landowners, oil and gas representatives, renewable energy representatives and “unanimously, we got a positive response.” Still, it took quite some time for Hirsche’s idea to catch on.

RenuWell can fit 750 kilowatts of solar on the average abandoned oil well pad, thus reusing the pad without further impacting farmland and creating a long-term source of revenue. Photo RenuWell

Crazy potential for a lot of solar

Once the energy regulator understood the concept, however, they were enthusiastic. “The AER  came forward and said, okay, we'd like you to think about doing 100 to 200 sites a year,” says Hirsche.

There is no way Hirsche’s small company could take on projects of that scale, so he partnered with the international solar company Canadian Solar based out of Guelph, Ontario. They’re working on the pilot project now.

“And if the pilots are successful, we're planning a commercialization expansion…that would be on the order of 50 or 100 megawatts a year for the next four or five years.”

When looking for a good place for the pilot project, a friend at the AER suggested Hirsche “find the biggest orphan well problem in the province” and then apply for orphan well funding.

And it turns out “the biggest orphaned well problem in the province, was just outside my hometown,” says Hirsche.

That town is Taber, Alberta. One of the two pilot sites they chose was on James Muller’s corn farm. “He’s a small acreage farmer…very well known in the Taber area and the ‘corn king’ for six of the last nine years.”

The site was contaminated by an oil spill back in the 1960s and has stood abandoned ever since, making it a great candidate for priority reclamation and a good site for a new solar farm.

The site is about 3.5 acres in size and will fit 900 kilowatts of solar—enough to power 90 homes.

The pilot project is owned by the Irrigation Canal Power Cooperative Ltd. (which is itself owned by the St. Mary Irrigation District). It’s a win-win situation for all parties: they are funding half of the project costs, and in return will be able to use some of the power to supplement much-needed energy for irrigation.

Solar can not only create a long-term revenue stream for abandoned well sites, it could also provide power for irrigation systems and help avoid transmission upgrades needed for irrigation. Photo supplied by RenuWell

Irrigation and solar

Solar makes for a pretty happy marriage with irrigation.

“The typical pivot irrigation system in Southern Alberta…takes about 22,000-kilowatt hours of electricity to run,” Hirsche says. One two-acre solar site could power “somewhere between 35 and 50 quarter-section pivot systems”—and the 3.5-acre system on Muller’s farm even more.

Irrigation creates significant demand for electricity in remote places. All too often, this leads to very expensive transmission and distribution upgrades. Hirsche is hoping they can position some of the solar projects to reduce the need for expensive transmission build-outs.

The second RenuWell pilot site is taking place east of Taber on five acres of late. It will be able to support a full megawatt of solar.

What a solar installation will look like on an abandoned oil well pad. Solar is not only a way to create a new revenue stream on abandoned oil sites it could also be used on existing oil sites to power energy-hungry pump jacks. Photo supplied by RenuWell

Energy transition and lower carbon oil

Irrigation districts are great partners for Hirsche’s idea, but they are also talking to community generation co-ops. Canadian Solar is also talking with larger utility-scale companies as well, looking to procure them “one megawatt at a time.”

Hirsche says he also believes the solar installations could help oil companies extend the life of conventional fields in Southern Alberta by integrating them into their facilities. Oil companies are already buying renewable energy to power operations in Texas because it's cheap.

“If we put solar in on the inactive leases, we can cut the power cost significantly for the rest of the operation…reduce carbon intensity and also improve the cost structure for the oil and gas operators,” says Hirsche.

This part isn’t always the easiest sell. Despite major oil companies investing billions in renewable energy, there is still some resistance in Calgary. There are still some who see the energy transition as a threat to Alberta’s economic prosperity—as though that prosperity was tied exclusively to conventional energy.

“We have to get over this false political problem that we have in the province,” says Hirsche. “If this can be done properly, it can be one of the biggest accelerators of energy transition. This can be a win-win for the oil and gas industry together with the renewable energy industry.”

Green Energy Futures · 278. Solar + Oil - Reclaiming abandoned wells with Solar

Potential for massive solar capacity and zero impact on existing farmland

As we learned in our recent story on Alberta’s Solar Boom, unsubsidized solar and wind development in the Alberta market is growing at an incredible pace these days. At this pace, Alberta will likely achieve energy goals previously set by the NDP government—30 per cent renewable electricity by 2030.

Add RenuWell to the mix, and the horizon is looking even brighter.

“I did the math, and it turns out that if I did 10 per cent of the oil and gas leases...it would be 6,200 megawatts of solar generation,” says Hirsche. That alone would achieve the previous NDP government’s goal.

RenuWell is a great marriage of conventional and renewable energy. Because RenuWell plans on using old oil infrastructure, their solar farms wouldn’t impact existing farmland.

What’s more, the projects would serve as an economic bridge for farmers and municipalities who would see oil and gas lease and tax revenues replaced by solar revenues.

David Dodge's picture
Thank David for the Post!
Energy Central contributors share their experience and insights for the benefit of other Members (like you). Please show them your appreciation by leaving a comment, 'liking' this post, or following this Member.
More posts from this member
Discussions
Spell checking: Press the CTRL or COMMAND key then click on the underlined misspelled word.
Bob Meinetz's picture
Bob Meinetz on Oct 21, 2021

David, here's a better idea - what about charging oil and gas companies for reclamation costs? That would be better than covering up the mess they've left with solar panels, wouldn't it?

David Dodge's picture
David Dodge on Oct 27, 2021

Agreed, these sites cannot simply be covered with solar modules in lieu of reclamation. The sites need to be reclaimed either way. 

Matt Chester's picture
Matt Chester on Oct 21, 2021

Seems like a great opportunity to help re-job people in this community that will continue to be hit by the energy transition-- thanks for sharing this innovative project, David

David Dodge's picture
David Dodge on Oct 27, 2021

Agreed Matt, this is a very hopeful development and seemingly a model energy transition strategy. It needs to be embraced by those in power.

Audra Drazga's picture
Audra Drazga on Oct 22, 2021

Curious how they are getting these connected to the Grid if they are out in the middle of nowhere? This seems like an interesting idea, just wondering about the practicality.

Roger Arnold's picture
Roger Arnold on Oct 23, 2021

From the article, I gather that most of the solar power will be used to power irrigation pumps on the farms where the well pads are located. Most of the farms probably have robust grid service. Power can be exported to the grid in the same way it's done for residential solar systems. May require upgrades to the distribution system to accommodate bi-directional power flow, but that's pretty routine these days.

David Dodge's picture
David Dodge on Oct 27, 2021

Hmmm, this is a good use for sure, but it's not the only potential use. Because of Alberta's deregulated system there are several options for solar farms in Alberta. A big driver these days are PPAs or PPA like agreements. Granted these are small farms, but if you combined a number of well pad sites you may have something worth pursuing. 

David Dodge's picture
David Dodge on Oct 27, 2021

While it is not always the case, most well sites are already connected to the grid because they use power.

Mark Silverstone's picture
Mark Silverstone on Oct 22, 2021

Great idea. It would be nice if the same could be done in Texas, where there are lots more abandoned wells as well as more sunshine.

Good luck!

Get Published - Build a Following

The Energy Central Power Industry Network is based on one core idea - power industry professionals helping each other and advancing the industry by sharing and learning from each other.

If you have an experience or insight to share or have learned something from a conference or seminar, your peers and colleagues on Energy Central want to hear about it. It's also easy to share a link to an article you've liked or an industry resource that you think would be helpful.

                 Learn more about posting on Energy Central »