Offshore wind development hits a snag in Ontario

Political machinations clip the wings of a green energy drive

April 01, 2011

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John Kourtoff sees at least one parallel between Alberta’s oil sands and a decision by the Ontario government to shelve his firm’s proposed offshore wind farm – Canada’s first – in the Great Lakes. “It’s the same thing as saying let’s stop all oil and gas production in Alberta while we do some studies,” the chief executive of Toronto-based Trillium Power Wind Corporation says. “You can’t do that.”

In February, the former Bay Street executive was in an afternoon meeting closing a $20-million financing deal for his firm’s 414-megawatt wind farm proposed for Lake Ontario. At the same time he learned the province was suspending all offshore projects pending further study. The reason? “Your guess is as good as mine,” Kourtoff grumbles.

Trillium is in the advanced planning stages of a $1.6-billion project, the first of four the firm hopes to build over the next 15 to 20 years. A start-up date of 2014 for the initial scheme, called Trillium Power Wind 1, is now uncertain, as the province decided offshore wind projects are no longer eligible for contracts under the feed-in-tariff component of its vaunted Green Energy and Economy Act.

Located south of Kingston in Lake Ontario, Wind 1’s 138 turbines were expected to generate enough electricity to power 177,000 homes. Over the setup’s 20 year lifespan, annual greenhouse gas reductions would have totalled 1.8 million tonnes. The project would have also conserved roughly nine billion liters of water needed to produce the same amount of electricity at the province’s aging thermal power plants.

Ontario’s Ministry of the Environment had previously outlined a proposed framework for developing offshore wind farms that included a five-kilometer “shoreline exclusion zone” to mitigate potential effects of installing turbines in the lakebed. Fully 70 per cent of Ontarians get their drinking water from the Great Lakes, one of several reasons cited by the province for abandoning plans to harvest the region’s wind.

“Ontario is not proceeding with offshore wind power projects until the necessary scientific research is completed and an adequately informed policy framework can be developed,” says a policy decision released by the Ministry of Natural Resources. While inland wind farms are well understood, the ministry says “offshore wind power development in freshwater lakes is relatively new and presents technical challenges that do not exist in a saltwater environment, such as the need to manage potential impacts to drinking water and the effects of ice build-up on support structures.”

But Kourtoff accuses the province’s Liberal government – led by embattled Premier Dalton McGuinty – of jeopardizing hundreds of jobs and millions in investment in the province’s budding green sector. “It’s like playing Russian roulette but without a revolver,” the executive growls. “You’re playing with a semi-automatic. There’s no question what’s going to happen. You’re talking $1.2 billion that will not be invested in lots of hard hit industrial communities around the Great Lakes.”

Despite the province’s objections, the Great Lakes are particularly well-suited to wind developments, Kourtoff says. Freshwater reduces maintenance costs associated with saltwater corrosion, and high tides are less of a risk relative to offshore wind projects located in the North Sea, where swells can reach anywhere from four to eight meters.

Trillium’s foray into the Great Lakes also eases another burden inevitably faced by developers of landlocked wind farms. A draft project description notes that the shoreline will be 28 kilometers from the nearest turbine – well beyond the initial exclusion zone proposed by the province’s environment ministry and out of sight from parochial landowners. Kourtoff does not mince words about the region’s potential. “The Great Lakes are absolutely the best place in the world to have offshore wind,” he contends.

A 396-megawatt offshore project proposed by Vancouver-based NaiKun Wind Energy Group Inc. for the Hecate Strait off the northwest coast of British Columbia faces considerably longer odds. “They’ve got some great wind but their challenge is transmission,” Kourtoff notes. “They’ve got to come back to Prince Rupert, which is 103 kilometers away.” Flotillas of turbines are also more reliable than their onshore counterparts. Think of them as “upside down oil wells,” Kourtoff says. “It’s a very constant form of energy that’s dependable. The reliability is four orders of magnitude greater than onshore wind.”

He isn’t alone in thinking big. The Conference Board of Canada conservatively estimates that 2,000 megawatts of power could come from offshore wind in Ontario by 2026. The total translates into roughly 60,000 person-years of employment and up to $5.6 billion in added gross domestic product.

The decision to scrap offshore wind is particularly galling for Kourtoff, an ardent defender of procurement policies under the green legislation that have pitched Ontario into a legal standoff with international suppliers of renewable energy components. “If the public is being asked in Ontario to buy the power under a feed-in tariff, long-term contract, I don’t think it’s unreasonable for them to expect that at least half the economics stay within the province,” he reasons. “Ontarians expect jobs just as anyone else does.”

But political machinations, including the fallout from rising residential electricity bills and a looming fall election, may yet scupper the province’s green dream. Kourtoff remains genuinely baffled by the turnabout on offshore wind. “It doesn’t make any sense to me. I can’t believe that this was something that was approved by the premier of Ontario.”

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