Ontario seeks to double 'green' power supply
Renewable energy developers cite policy barriers
Tyler Hamilton, Energy Reporter, TheStar.com, August 28, 2007
The Ontario government has directed the province's power authority to purchase
another 2,000 megawatts of green electricity supply, doubling the amount of
renewable power already under contract.
"It's an important next step," Energy Minister Dwight Duncan said in an
interview. "We have to make sure we continue to develop renewable power, from
all sources."
The move comes six weeks before a provincial election that experts say will put
the McGuinty government's energy and environmental policy under a critical
spotlight.
Industry observers called the directive a positive step, but said many renewable
project developers in Ontario have been discouraged by a number of barriers,
both infrastructure and policy related, that have delayed their plans or scared
away investors.
"There's a significant amount of money that's been invested in the area, and
people were encouraged to invest those dollars, but investment doesn't sit
forever," said David Timm, Ontario policy manager for the Canadian Wind Energy
Association.
Timm said transmission constraints, particularly in a large area of southwestern
Ontario, called the "orange zone," have prevented many developers from moving
ahead until adequate capacity can be added to the lines.
And even with new capacity, many observers say the government is giving priority
to nuclear power, not renewables.
Permitting delays have also played havoc with developers' business plans, an
issue that needs to be addressed if the province wants its latest power purchase
negotiations to be successful, added Timm.
"Investors need to be able to sell their power somewhere, and they need to know
when that will happen."
The government has directed the Ontario Power Authority to begin talks with
native groups, industry and other stakeholders to determine how it will go about
purchasing the power and determining schedules for connecting the green energy
to the power grid.
The procurement will be broken into phases, with the process for a 500-megawatt
purchase put in place by the end of this year.
Only projects above 10-megawatts will be considered. Duncan said the requests
for proposal will be open to all forms of renewable energy, including
hydroelectric and landfill gas.
Though a long shot, even enhanced geothermal energy projects could qualify.
"If there was a practical electricity generation application, it would certainly
be looked at," said Steven Erwin, a spokesperson for the energy ministry.
Successful proponents will have to demonstrate they have adequate access to
transmission lines, meaning projects located in the orange zone will likely be
excluded.
The devil will be in the details, said Joyce McLean, director of strategic
issues at Toronto Hydro Corp., which wants to build an offshore wind farm in
Lake Ontario near the Scarborough Bluffs.
"Unless they have a mechanism to procure higher-cost offshore wind, it doesn't
really benefit the proposal from Toronto Hydro," she said.
Premier Dalton McGuinty's government has set a long-term goal of creating 15,700
megawatts of renewable generation by 2025.