On December 11, 2025, two bills addressing data centre development in the province received Royal Assent:
-
Bill 8 enacted the Utilities Statutes Amendment Act, 2025, which amends the Electric Utilities Act (EUA) to clarify the regulatory framework for data centre development in Alberta.
-
Bill 12 enacted the Financial Statutes Amendment Act, 2025 (No. 2), which introduces a framework to impose levies on grid-connected data centre projects.
The key changes for data centres introduced in Bills 8 and 12, the relevant parts of which are now in force, align with the Government of Alberta's (Province's) commitment to meeting the surging demand for computing capacity driven by artificial intelligence technologies, while supporting a long-term, sustainable approach to powering data centre projects.
These developments follow the AESO’s phased approach to grid integration for large loads, discussed in our previous blog post. In the summer of 2025, the initial phase of that approach allocated 1,200 MW of connection capacity to two data centre projects that have now executed load contracts with the AESO, with power delivery anticipated by 2028.
The changes discussed below are expected to provide the AESO with additional flexibility as it develops the second phase of its large-load integration approach, which will address the majority of data centre connection requests (i.e., those that did not receive capacity allocations in the initial phase). The AESO stated it will release a proposal for broader industry engagement on the approach in early 2026.
Bill 8: Balancing Data Centre Demand
The key amendment introduced in Bill 8 with respect to data centre development is the addition of broad regulation-making powers that would enable the introduction of a bespoke regulatory framework for data centre projects. Powers afforded to the Minister include the ability to:
- define and identify different classes of data centres;
- regulate regarding the provision of system access service (grid connection);
- regulate respecting load management, load shedding, and consumption of electricity; and
- broadly, provide exemptions from requirements under Alberta's primary electricity statute, the EUA.
In a November 25, 2025 press release regarding the introduction of Bill 8, Minister of Affordability and Utilities Nathan Neudorf and the President and CEO of the AESO, Aaron Engen, focused on the need to connect data centre loads without putting the grid at risk and impacting electricity affordability.
They noted that Bill 8 provides more flexibility for integrating large load customers and will facilitate the addition of net power to the grid by data centre projects with a generation component. Minister Neudorf stated that, under the Bill 8 amendments, data centres that "bring their own power" by signing agreements directly with power generators to add power to the grid will be prioritized and will enjoy an accelerated approval process. Projects that come with a generation component are preferred because they contribute to their own load requirements, mitigating grid reliability concerns associated with significant data centre loads. Minister Neudorf also indicated that regulations under Bill 8 and AESO requirements may require generators that bring their own generation to also provide some level of power redundancy for the grid—i.e., building power generation capacity in excess of their load requirements.
The Province has also indicated that changes would be made under Bill 8 so that the cost of transmission upgrades required for connecting a data centre would be borne by the data centre developers and not by ratepayers, reflecting what is called a "cost-causation" approach.
The powers to provide exemptions to data centres from EUA requirements could allow for consequential carve outs for data centre proponents. For example, such exemptions could address the existing barriers to self-supply for data centres that want to bring their own generation. These barriers are discussed in detail in our previous blog post.
Bill 8 also includes amendments to facilitate the implementation of the Restructured Energy Market as part of ongoing changes to the Alberta electricity regime (discussed here).
Bill 12: The New Data Centre Levy Framework
Along with Bill 8, Alberta introduced Bill 12, which includes, among other amendments, changes to the Alberta Corporate Tax Act to establish a data centre levy framework.
Under the Bill 12 amendments, large data centres that are grid-connected and draw 75 megawatts (MW) of power or more would be subject to a levy on "computing equipment". "Computing equipment" is defined in detail in the Bill 12 amendments, and would include tangible items such as internal operational components, certain power distribution and cooling components, networking equipment and certain essential software and firmware of the data centre. The levy does not apply to real property (land and buildings) associated with data centres.
The levy framework is not intended to add a net tax burden for data centres, as the levy will be a credit against Alberta corporate income tax payable by the relevant corporation.
The levy will also depend on whether the data centre configuration includes a self-supply component. As detailed more fully in formulas contained in Bill 12:
- There will be a levy of two percent on the value of computing equipment for data centres that rely exclusively on the Alberta grid for their source of power.
- The levy will be reduced in proportion to the share of the data centre's total power supply that is provided under new power capacity agreements or self-generation arrangements.
- Data centres that are fully supplied via new power capacity agreements (e.g., power purchase agreements that result in new generation capacity being added to the grid) or self-generation arrangements will be subject to a levy of only one percent on the value of the computing equipment. This would apply for projects that have a grid connection for redundancy purposes only and do not rely on power from the grid during the relevant calendar year.
- The levy does not apply to power supply arrangements that are fully off-grid.
Bill 12 introduces a narrow definition of "self-generation arrangements" that applies only to the electricity produced by the operator of a data centre and delivered to the data centre. This may inadvertently limit the commercial arrangements available to data centre operators by, for example, requiring the data centre owner to also own the power plant in a self-supply configuration.
Of note, Bill 12 also empowers the Province to vary the levy payable through bespoke agreements with data centre proponents. However, the levy payable over all calendar years under any such agreement must not be less than the total levy that would otherwise have been owed pursuant to the Alberta Corporate Tax Act.
Concluding Thoughts
The amendments introduced in Bill 8 and Bill 12 are part of a broader initiative by the Province to make Alberta a hub for artificial intelligence investment, as outlined in the Alberta Artificial Intelligence Data Centres Strategy (the Strategy). The Strategy aims to advance power capacity, foster innovation in sustainable cooling and attract investment in data centre development to encourage economic growth.
Recent energy developments also include the memorandum of understanding (MOU) between the Province and the Government of Canada. Among other commitments, the MOU outlines mutual support for data centre development and includes a commitment to the implementation of a policy framework by July 2026 to incentivize large data centre development, including incentives for Canadian sovereign computing. The MOU also contemplates that the federal Clean Electricity Regulations (CER) will not apply in Alberta. However, to date, the formal steps required to end the application of the CER in Alberta have not been implemented.
The changes introduced in Bills 8 and 12 with respect to data centre development in Alberta greatly expand the tools available to the Province and the AESO in their efforts to support significant demand for data centre projects while managing grid stability and affordability.
The full extent of these latest policy developments remains to be seen, with several details to be addressed in future regulations. Potential issues that may be addressed in such regulations to enable data center development could include: a framework that enables coordinated transmission planning and cost allocation that enhances investment certainty and Alberta competitiveness; codification of the "bring your own power" policy and associated exemptions and accelerated approval processes for data centre-associated power plants; and the removal of regulatory barriers for data centre self-supply arrangements. Moreover, further legislative amendments may be forthcoming; current regulatory barriers within the Hydro and Electric Energy Act have prompted discussions regarding additional legislative amendments needed to support data centre development.
Bennett Jones continues to monitor regulatory and legislative developments impacting data centre opportunities in Alberta. If you have any questions in this regard, please contact the authors of this post or a member of the Bennett Jones Energy Regulatory practice group.
