Richard Baillie, Contributor
December 27, 2012 | 6 Comments
CanWEA is, unsurprisingly, up in arms about this latest development. Hornung sounded off in a statement about the ‘unfortunate decision. ‘Ontario lifted a ban on offshore wind development about two years ago, only to now resurrect it. Ontario is proving itself a leader in driving a new clean energy future that delivers emission-free power and new jobs for our skilled trade workers. This is an unfortunate decision that surrenders the province’s leadership role in exploring the potential for offshore wind energy in the Great Lakes and creates significant uncertainty for investors.’
Concern over the shore-side visual impact of turbines poses another challenge for developers. In many locations, particularly the Great Lakes, water depths plunge steeply. Taller turbines, while feasible, would be far more expensive than conventional devices. Then there is political opposition to wind turbines, which in Ontario is substantial. McGuinty’s green energy initiatives have often been attacked by local residents, many of whom see wind turbines as harmful both to human health and the environment.
In 2011, the province announced a moratorium on offshore wind power until at least 2014, when the results of a Health Canada study into possible ill effects from low-frequency noise will be released. This has sparked lawsuits by wind energy developers, which claim their projects were already in the works. Meanwhile, some members of the Progressive Conservative Party are calling for a moratorium on all wind energy development in the province.
Health Canada announced in July that it would conduct a study exploring the relationship between wind turbine noise and the negative health effects such as sleeplessness, inner ear problems and depression reported by nearby residents. ‘The McGuinty Liberals did not conduct an in-depth study into the health effects surrounding wind turbines before they invaded rural Ontario with their big green energy dreams,’ said opposition MPP Lisa Thompson. ‘And we have heard from many throughout the years that that dream has turned into a nightmare.’
By the end of 2011, wind power generating capacity in Canada
was 5265 MW, of which 1969 MW were in Ontario, accounting for
around 2.3% of Canada’s total electricity demand (GWEC)
The wind industry appears to be increasingly aware that its continued growth depends on countering these claims. Considering the multitude of projects scheduled to come on line next year – and over coming years – the wind industry needs to work harder on ‘social acceptance’, said Hornung recently.
‘We need to do a better job in telling our story,’ he stressed. ‘To realise our full potential, we need to work together. We need to roll up our sleeves and do the hard work.’ Educating the public and working with stakeholders is CanWEA’s top strategic priority for the next three years, he added.
Ontario’s unwillingness to proceed with offshore wind is particularly galling to wind energy proponents in light of developments south of the border. The US has pipelined a plethora of offshore wind projects in the Great Lakes region, where the Department of Energy rates the wind as ‘outstanding’ in some locations.
‘You will never find a better spot than the Great Lakes,’ said John Kourtoff, CEO of Trillium Power Wind Corp, a Toronto company that plans to begin erecting turbines in Lake Ontario in 2013.
Meanwhile, in August 2012, The New York Power Authority began considering four proposals for its GLOW (Great Lakes Offshore Wind) Project. The project aims to construct wind farms in either Lake Erie or Lake Ontario, or both, totalling from 120 MW to 500 MW. Further along are Scandia Wind Offshore’s 500 MW project for Lake Michigan and Ohio’s plans for a 20 MW farm near Cleveland about six miles into Lake Erie.
Aside from the environmental challenges, the cause of wind power in Ontario received a serious setback in October 2012 when provincial premier Dalton McGuinty resigned. McGuinty was one of the chief architects of the province’s Green Energy Act (GEA), which established the FiT, and he has been a strong, powerful and vocal advocate for wind energy in the province over the past few years.
Indeed, only last October, Ontario’s wind energy industry was extremely relieved when pro-renewables McGuinty defeated Progressive Conservative Party candidate Tim Hudak, who had promised to repeal many of the GEA’s core tenets and terminate a host of wind and solar energy initiatives that were already underway in the province. A successor to McGuinty has not yet been named, but industry experts believe the GEA will remain in place, at least for now.
‘As one of Canada’s foremost champions of wind, McGuinty’s leadership and support has been critical to Ontario’s success,’ said Hornung. ‘The [Green Energy] Act is a policy of the Liberal government, and we expect that to continue.’ CanWEA will reach out to the provincial government to ensure it continues its renewable energy leadership and its efforts to increase Ontario’s wind energy capacity, he added.
WTO Delivers Another Setback
Also in October, Ontario’s wind energy policies received another serious setback, this time from the World Trade Organization (WTO) over policies that force companies to buy equipment from local manufacturers.
The WTO has issued a preliminary report that agrees with Japan and the EU in their complaint about Ontario’s support for its renewable energy industry. If the preliminary report stands, Ontario might have to dismantle parts of its FiT programme, which prompts producers of wind (and solar) to buy a proportion of their equipment in the province.
A final ruling is expected in November, but the WTO seldom backtracks on its preliminary reports. The WTO says the local content rules break non-discrimination rules in the General Agreement on Tariffs and Trade. Japan initially filed its complaint with the WTO two years ago, saying that Ontario’s green-energy plan unfairly pressures producers of clean energy to buy hardware from manufacturers in the province. The EU joined in the complaint in 2011, saying European exports of wind and solar equipment to Canada would be higher without the local content rules.
Complaints at the WTO are lodged against countries rather than provinces, so the filings were against Canada rather than Ontario. The Ontario energy ministry says it believes that the FiT programme is consistent with Canada’s WTO obligations. ‘Should the panel disagree, we are ready to pursue all options with the federal government, including an appeal of the decision.’
Stuart Trew, who works as a trade campaigner for the Council of Canadians, said the ruling, if it stands, will be ‘a terrible loss, not just for Canada, but also for countries globally who are looking for ways to make their economies more dynamic.’
Trew believes Ontario will likely put pressure on the federal government to appeal the final decision, if it goes against them. Ontario might also be given the option to amend the problematic portions of its energy policy to bring them on side. ‘It is going to be a long process,’ he said.
If Canada is to continue to grow its wind industry, then there are clearly issues that need to be addressed. These will involve allowing more overseas companies to compete for contracts and giving foreign investors a greater role in the industry. This may, however, have the side effect of making wind energy less politically acceptable to voters.
There is also a growing need for a political consensus, particularly in Ontario, where in the absence of a strong wind advocate to replace McGuinty, the long-term growth of the wind industry now appears less certain than at any time in recent memory.
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