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Ontario Unveils Green Energy and Green Economy Act, 2009

Just one week after U.S. President Obama signed into law the America Recovery and Reinvestment Act of 2009 with billions set aside to promote the build-out of new renewable energy capacity and make the U.S. more energy efficient, Ontario's Premier Dalton McGuinty and Energy Minister George Smitherman unveiled a plan to infuse the Canadian province with green energy and energy efficiency improvements.

The Green Energy and Green Economy Act, 2009 (GEA) takes a two-pronged approach to creating a green economy. The first is to bring more renewables to the province and the second is the creation of more energy efficiency measures to help conserve energy. The bill also includes measures that the ministry hopes will foster a new green economy for Ontario by giving organizations and local communities such as First Nations and Métis communities more opportunities to develop distributed renewable energy generation projects.

Greater Use of Renewables

While Ontario can boast that it has brought more than 1000 megawatts (MW) of renewables online since October 2003, the Green Energy Act would dramatically increase that number through some important legislative vehicles.

The bill proposes enacting a feed-in tariff (FIT) with pricing that will hopefully generate more investment in renewable energy by offering investors greater confidence in the profitability of projects and increasing their access to funding. The FIT will be modeled after Germany's successful policy.

Dr. Hermann Scheer, General Chairman of the World Council for Renewable Energy and widely recognized architect of Germany's FIT said, "Ontario's Green Energy Act represents North America's most ambitious and far reaching enabling legislation and will place Ontario as a world leader in renewable energy development, industrial innovation and climate protection."

In addition to the FIT, the bill streamlines the approvals process for renewable energy projects and provides service guarantees for them. It also establishes a "right to connect" to the electricity grid for renewable energy projects.

The bill would also appoint a Renewable Energy Facilitator to provide "one-window" assistance and support to project developers in order to facilitate project approvals. The approvals process for transmission projects would also be streamlined.

For the first time in Ontario, the bill would enact standards for renewable energy projects, such as standardized setback requirements for wind farms.

To support local communities, the bill offers measures to assist developers of smaller community-owned generation facilities and also implements a smart grid in Ontario, with the aim of making it easier for renewables to connect to the system.

Finally homeowners would have access to incentives to develop small-scale renewables such as low- or no-interest loans to finance the capital cost of renewable energy generating facilities like solar panels.

According to Dave Butters, president of the Association of Power Producers of Ontario, member companies of which have installed much of Ontario's renewable energy facilities so far, the bill will ensure that Ontario makes maximum use of renewable energy.

"A ‘best-in class renewable energy feed-in tariff' combined with streamlined approvals processes and service guarantees has the potential to help Ontario to leap forward in terms of renewable energy capacity," he said.

Energy Efficiency Measures

Currently, Ontarians spend just over CAN $7 billion [US $5.6 billion] each year on electricity to power their homes. A 10% efficiency savings would mean CAN $700 million more in the pockets of homeowners across the province. To that end, if the GEA passes, it would help individual consumers, businesses and public institutions take steps to increase energy efficiency in their facilities.

The bill makes energy efficiency a prominent aspect of Ontario's Building Code by requiring, every 5 years, a review of the efficiency of any given building to identify areas that might be improved through better energy efficiency technology. Further, it establishes an advisory council to provide energy efficiency advice to the Minister of Municipal Affairs and Housing.

If passd, the bill would create the opportunity for consumers, public institutions and industry to better manage their energy use through various conservation initiatives, one of which may be the establishment of Leadership in Energy and Environmental Design (LEED) Silver as the standard for new government-owned buildings.  It also would require the broader public sector, including municipalities, universities, colleges, schools and hospitals, to develop energy conservation plans.

In terms of household appliances and water use, the bill would require the use of Energy Star appliances as standard and require that households make efficient use of water. Homes would be required to have an energy audit prior to their sale, which some authorities say would put a "second price tag" on all homes sold in the province.

Local distribution companies would have mandatory conservation targets as well as incentives to help them achieve the targets. Ontarians living in low-income housing would also benefit from conservation measures targeted at that sector.

Green Economy

The proposed bill is estimated to create 50,000 jobs in Ontario in three years with its benefits sweeping across all communities. Employment will be in every sector, according to some analysts, from steel workers to lawyers, manufacturers and contractors.

Toronto-based Trillium Power Wind Corp., an offshore wind developer currently at work on a 710-MW facility in Lake Ontario, sees the plan as a step in the right direction.

"The Ontario government clearly recognizes that you need to make a long-term commitment to renewable energy in order to reap the economic benefits of a green economy," said John Kourtoff, President and CEO of Trillium. "They are way ahead of the game on this, and Ontarians are going to significantly benefit from this transformational legislation."

With the U.S. and Canada now clearly on the path toward a green revolution, it's clear that energy generation will look very different in 10 years time.

"I must point out that our entire continent is about to undergo a green energy transformation. In his inaugural address, U.S. President Barack Obama said that America ‘will harness the sun and the winds and the soil to fuel our cars and run our factories.' The continent's energy industry is on the cusp of a major change. And with the introduction of the Green Energy Act, Ontario will be at the forefront of progress, a dynamic force for change," said Paul Massara, Chair of the Toronto Board of Trade, an organization that promotes businesses throughout the city.

The government of Ontario has put forth a plan that it hopes may form a path toward a sustainable, prosperous future; one that may help prop up its slumping economy. With the U.S. government's introduction of the American Recovery and Reinvestment Act it looks like both countries are holding out hopes for green economic recoveries.

"Ontario's Green Energy Act could propel the province past California as the most innovative North American leader in the renewable energy field," said contributor Denis Hayes, former director of NREL and founder of Earth Day.

"This is the sort of healthy, friendly competition between Canada and the U.S. that will leave us both better off."

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