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Today, wind energy is the fastest growing energy source. Canada’s wind energy industry is growing quickly too, powering more than 860,000 Canadian homes. CanWEA estimates wind energy can satisfy 20 per cent of Canada’s electricity by 2025, elevating Canada to real player status in the wind energy sector. Achieving this goal will generate $79 billion of investment; create 52,000 high quality, full-time jobs, while adding 55,000 MW of clean generating capacity and reducing Canada’s annual greenhouse gas emission by 17 Megatonnes.
Total Wind Power Installed capacity
In 2008, Canada became the 12th country in the world to surpass the 2,000 MW mark in installed wind energy capacity – ending the year with 2,369 MW. Canada’s wind farms now produce enough power to meet almost 1% of Canada’s electricity demand.
2008 was Canada’s second best ever year for new wind nergy installations with ten new wind farms installed representing 526 MW of wind energy capacity. Included in this total were the first wind farms in the provinces of New Brunswick, Newfoundland and Labrador. The only remaining Canadian province without any wind generating capacity, British Columbia, saw construction begin on its first wind farm with commissioning expected in early 2009.
At the end of 2008, Canada’s wind energy capacity was distributed across the whole country:
* Ontario: 781 MW
* Quebec: 531 MW
* Alberta: 524 MW
* Saskatchewan: 171 MW
* Manitoba: 103 MW
* New Brunswick: 96 MW
* Prince Edward Island: 72 MW
* Nova Scotia: 61 MW
* Newfoundland and Labrador: 27 MW
Looking ahead: more than 650 MW expected for 2009
Like elsewhere, in Canada the financial crisis has made financing harder to come by and more expensive. This is expected to lead to the delay and cancellation of some projects as well as more consolidation within the industry, but only in the short term. As a result, CanWEA have lowered their expectations for 2009, but still envisage a substantial growth of 650 MW of new capacity additions. This would move Canada past 3,000 MW of installed capacity.
More than 5,000 MW of additional wind energy projects have now signed power purchase agreements and will be constructed in the five year period beyond 2009. This ensures steady growth in the Canadian market going forward.
In 2009, it is expected that the governments of Ontario, Quebec, British Columbia and Prince Edward Island will sign more power purchase agreements for wind energy projects as a result of competitive procurement processes launched in 2008 and early in 2009.
Looking further ahead, many Canadian provinces now have targets in place for new wind energy development. Ontario is aiming to put in place 4,600 MW of wind by 2020 and is now examining whether or not it can strengthen this target.
Quebec is seeking 4,000 MW of wind by 2016 and has now contracted most of this power. Alberta, which only two years ago had put in place a 900 MW cap on wind energy development, is now seeking regulatory approval to build new transmission lines to connect 2,700 MW of wind.
Even Canada’s three small Maritime provinces are now seeking a minimum of 1,200 MW of wind by 2015. Canada’s smallest province, Prince Edward Island, which has a peak load of only 210 MW, aims to develop 500 MW of wind to
provide 30% of the province’s electricity needs and to export the remainder to the United States.
Taken together, provincial targets would, if achieved, result in a minimum of 12,000 MW of installed wind energy capacity in Canada by 2015.
A new wind vision for Canada
Despite the rapid growth of the wind energy industry in Canada, the country is losing ground to the global leaders in wind energy, such as the United States. Unlike a growing number of countries, the Canadian government is still not “thinking big” about wind energy.
In order to stimulate such a discussion in Canada, CanWEA released a strategic plan in 2008 entitled Wind Vision 2025 – Powering Canada’s Future. The plan argues that Canada can and must ensure that wind energy supplies 20% of the country’s electricity demand by 2025, bringing total Canadian wind energy to 55,000 MW. This target would generate $79 billion CDN of investment in Canada by 2025 and would make the Canadian wind power sector a major player in the international wind energy market.
Development on this scale would also have a major impact on the country’s economy, creating a minimum of 52,000 full time jobs, and many more if Canada develops a much stronger domestic wind energy supply chain. Furthermore, it would increase the annual revenue for Canadian municipalities and landholders by $165 million CDN. The strategy states that increased wind energy production would stabilize electricity rates for Canadians, ensure a diversity of supply and reduce Canada’s annual CO2 emissions by 17 million tons annually.
Challenges to be addressed
Canada’s federal government has played an important role in stimulating wind energy deployment through the provision of production incentive payments under the ecoENERGY for Renewable Power program. This program, which provides a production incentive of 1 cent/kWh for the first 10 years of production, was first enacted in January 2007 and was scheduled to run until March 2011. However, due to strong demand, it will fully allocate all of its funds before the end of 2009 and the federal government has not yet committed to extending and expanding the program. This will be a high priority for the wind energy industry in 2009.
Work continues on a carbon pricing system in Canada.The federal government is currently aiming to put in place a greenhouse gas emissions trading scheme that will establish a price for carbon in 2010, but the design of the system will ensure that the price for carbon does not exceed $15 / tonne for the first couple of years of the program. According to CanWEA, however, this system is not likely to be implemented in 2009.
Wind energy procurement at the provincial level is usually undertaken through competitive tendering processes that are often oversubscribed by a factor of 3-5. In many provinces, there is no clearly defined, long-term procurement strategy. The wind energy industry will be working to seek reforms to procurement systems in order to provide stable and steady wind energy procurement over the long term.
Ontario has enacted Standard Offer Contracts (i.e. feed in tariffs) for projects of 10 MW or less. The program was put on hold in 2008 due to overwhelming demand, but is expected to restart in 2009.
In some areas of Canada, wind energy development cannot proceed because of a lack of transmission capacity. While transmission planning processes are increasingly taking wind energy into account, there remains significant uncertainty in some regions of Canada as to how quickly new transmission
can be built.
Finally, there continues to be a need to standardize and streamline wind energy permitting and approval processes to speed up regulatory approval for new wind farms.
Canadian Wind Energy Association
The Canadian Wind Energy Association (CanWEA) is a non-profit trade association that promotes the appropriate development and application of all aspects of wind energy in Canada, including the creation of a suitable policy environment.
Established in 1984, CanWEA represents the wind energy community — organizations and individuals who are directly involved in the development and application of wind energy technology, products and services.
CanWEA’s members are Canada’s wind energy leaders. They are wind energy owners, operators, manufacturers, project developers, consultants, and service providers, and other organizations and individuals interested in supporting Canada’s wind energy industry.
CanWEA applauds new processes to procure wind energy in Quebec and revised pricing for community and First Nations wind energy projects
New RFPs for 500 MW of wind energy will allow Quebec to reach its target of 4000 MW by 2015
The Canadian Wind Energy Association (CanWEA) applauds announcement to proceed with the procurement of 500 MW of new wind energy capacity in Quebec and to increase the ceiling price from 9.5 ¢/kWh to 12.5 ¢/kWh in the call for tenders for the purchase of two separate blocks of 250 MW of community and First Nations wind energy projects. CanWEA and its membership had argued the original proposed pricing of 9.5 ¢/kWh was not sufficient to attract or sustain long-term investment.
The Quebec Government anticipates these two RFPs will generate $1.3 billion in investments and create more than 4,000 jobs, bringing both economic and social benefits to many regions of the province. The RFPs were launched yesterday with the first wind energy projects expected to be operational as early as 2012, putting Quebec on track to meet its target of developing 4,000MW of wind energy by 2015.
“This new procurement process and the revised pricing within it is timely news for both the wind energy industry in Quebec and the many communities that will benefit directly from local jobs and new investment within the current economic context,” said Robert Hornung, president of CanWEA. “We wish to highlight the work of the Hon.Claude Béchard, Minister of Natural Resources and Wildlife, and his Ministry staff in working towards a pricing structure which will set the foundation for a growing and sustainable wind energy industry in Quebec.”
Wind energy represents a major industrial development and economic stimulus opportunity for Canada. Between now and 2020 it is estimated that $1 trillion will be invested in new wind energy facilities worldwide and that more than 1.75 million jobs will be created in this rapidly growing industry. This recent RFP well positions Quebec to capture a growing share of these economic, environmental and social benefits.
CanWEA’s Wind Vision 2025 – Powering Canada’s Future, argues that Canada has the potential to make wind energy the country’s next great economic opportunity, while also reducing greenhouse gas emissions and addressing other environmental concerns. Achieving the goal of providing 20 per cent of the country’s electricity needs with wind energy by the year 2025 will result in $79 billion in new investment, the creation of up to 52,000 new “green collar” jobs, and more than $165 million in new revenues for municipalities, many in rural areas hit hard by traditional resource declines.
The Canadian Wind Energy association (CanWEA) is a non-profit industry association representing more than 420 members in the wind energy industry. CanWEA promotes the responsible development and application of all aspects of wind energy in Canada, including the creation of a suitable policy environment.