Ontario halts offshore wind power projects

Also Friday, energy officials said about 1,000 homeowners applying to its microFIT program are being told they cannot go ahead with their project because of capacity issues on the grid. Energy minister Brad Duguid downplayed the policy change, saying only a small proportion of applicants to its heavily subsidized feed-in tariff (FIT) program were from offshore wind turbines.

Only one offshore wind farm project has been approved since the program came into effect in 2009. Windstream Energy Inc. planned on putting 100 wind turbines southwest of Wolfe Island in the Kingston area.

"It’s simply a case of recognizing we need to take a closer look at the science on freshwater offshore wind farm projects," said Duguid. "Right now there’s only one in the world we’re aware of, in Sweden. There’s a number of issues that need to be looked at before anything could ever be considered for approval."

Opponents of wind energy called the change a major victory, saying the reversal proves the government moved too fast on implementing the program in the first place.

"They haven’t done their homework on wind energy," said John Laforet, president of Wind Concerns Ontario. "A long-term energy plan should be based on cold hard facts. They’re doing serious damage to the province by shooting from the hip on this issue."

Duguid argued the province would have lost out if it had hesitated.

"There was a necessity to move quickly to capture the world market for clean energy. Had we not moved quickly at the outset of this program, Ohio or some other jurisdiction would right now be the benefactor of the billions of dollars that are flowing into the economy and the thousands of clean energy jobs we are creating."

It is unclear what compensation if any will be offered to Windstream, which had the lone offshore wind contract in the province.

"We are aware of the Ontario government’s announcement on offshore wind and we are examining all of our options," said Nancy Baines, a spokeswoman for the company.

Wind energy is a key part of Ontario’s FIT program, which offers heavily subsidized long-term contracts to renewable energy developers who use a certain amount of domestic content in their projects.

While the program has achieved some success (15 large-scale projects are now in service, adding 10.6 mw of power to the grid) it has also encountered numerous setbacks. Its future is also mired in political uncertainty ahead of October’s provincial election. Conservative Leader Tim Hudak has criticized the guaranteed 20-year rates as unsustainable.

The Canadian Wind Energy Association (CanWEA) today expressed its disappointment with the Ontario government’s decision to pause offshore wind energy developments.

“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,” said CanWEA president Robert Hornung. “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.”

There was more than 2,000 MW of installed offshore wind energy capacity in ten countries worldwide at the end of 2009. While there are currently no offshore wind farms in North America, several projects are in development in the U.S. Global wind power installations increased by 35.8 GW in 2010, according to figures released by the Global Wind Energy Council. This brings total installed wind energy capacity up to 194.4 GW, a 22.5 per cent increase on the 158.7 GW installed at the end of 2009. New capacity added in 2010 represents investments worth $65 billion (US).

“As a responsible industry that promotes sustainable development practices, we look forward to working with the government to understand their proposed timelines and scope of research into the application of offshore wind energy in the Great Lakes,” said Hornung. “We ultimately believe there is great potential for offshore wind energy to provide clean energy and new jobs in Ontario. We are encouraged, however, to see the government’s continued commitment to its Long-Term Energy Plan, which includes significant growth in wind energy production in Ontario.”