Public utility helps Ottawa condo project meet zero-carbon marketing claims

Controversial $1.2 billion Zibi development located at sacred Algonquin site
Photo: Douglas Sprott

A corporation that brands itself as green has designs on the river water in Ottawa’s downtown core as a source of "clean" energy. Its relationship with Hydro Ottawa is helping it meet that goal, despite the mayor’s claim that no municipal dollars will be spent on the mega-development project known as Zibi.

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If all goes according to plan, expansion of Hydro Ottawa’s generating facility at Chaudière Island in the Ottawa River will be complete by the spring of 2017.

The massive excavation aims to install two turbines on an Algonquin sacred site that includes a waterfall held back by a small dam built in 1908. Energy Ottawa, a private sector arm of Hydro Ottawa, which is owned by the City of Ottawa, is in charge of the $150-million project to supply green, renewable energy to 20,000 homes.

Excavation for the hydro expansion, Dec. 2015.

Those homes represent about five per cent of households in the city, and would certainly meet the power needs of Windmill Development Group’s Zibi development, touted as a greener-than-green condo and business complex spanning the Gatineau shoreline that would include two islands on the Ontario side of the Ottawa River.

By entering into a business relationship with Windmill, Ottawa’s public utility is supporting the company’s marketing hype.

Green branding and privatization

Having a zero-carbon footprint by 2020, as set out in the One Planet Living environmental endorsement Windmill’s plan has received — something that has come under heavy criticism due to possible conflicts of interest — is a lynchpin in Windmill’s green branding.

"[Hydro Ottawa] could either partner with us or watch us take 4000 doors away from them with them on the outside," said Scott Bentley, development manager at Windmill, who was quoted in an article published by Canadian Property Management earlier this month.

Bentley was referring, in a seemingly threatening way, to the possibility that Windmill could meet its zero-carbon goals by creating a district energy system outside of Hydro Ottawa’s network. In effect, Windmill would take customers away from Hydro Ottawa by taking its commercial project off-grid.

According to Bentley, Hydro Ottawa decided not to be "on the outside" of the developer’s plan. "They had an opportunity and came to us with open arms," he concluded.

The evidence — which includes meetings, a memorandum of understanding, and a video that shows Windmill staff and guests enjoying direct access to the Chaudière dam — points to a cozy relationship between Windmill and Hydro Ottawa. But none of this has been subject to consultations or announced by the public utility.

The corporate wooing of a public utility has played out against the backdrop of hydro privatization, as opponents say Ontario’s water constitutes a natural resource that should not be in private hands.

Special access

The open arms that Hydro Ottawa has extended to Windmill Development Group are problematic for another reason.

Although the city’s support for the controversial $1.2-billion condo development has involved rezoning of the islands from parkland to a commercial and residential area (held up in courts since early 2015 due to a continuing legal challenge by renowned Anishinaabe architect Douglas Cardinal and four other appellants), Ottawa Mayor Jim Watson said no public funding would be extended to Windmill.

"We will work very closely with them to ensure that we're rolling out the red carpet and not the red tape," he said in April 2014 when Windmill was calling its condo proposal The Isles. (In February 2015, the company partnered with the $15-billion real estate giant Dream Unlimited Corp. and rebranded the project as Zibi, the Algonquin word for river.)

"Everyone is singing to the same tune," Windmill founder Jonathan Westeinde told reporters that same month. He was referring to the relationship the company was developing with the cities of Ottawa and Gatineau as well as the National Capital Commission.

Records from 2013 and 2014 show that Jeff Westeinde, brother to Jonathan and also a partner in Windmill, met twice with Mayor Watson and several times with senior staff and councillors.

Lobbying records

In the case of Windmill and its Zibi project, lobbying seems to have paid off in a close relationship with city officials and special access to the Chaudière dam.

Video footage from June 2015 shows Jeff Westeinde on Chaudière Island with an employee from Hydro Ottawa, who talks about how happy he is to have opened the gates to Windmill and its First Nations supporters (mostly members of the Memengweshii Council), so they can enjoy the view of swirling water at this company-sponsored gathering.

Intended as a marketing tool, the video was posted briefly online but never released by the company.

Allowing the developer access to the dam site required approval from high levels within Hydro Ottawa, which was granted while the City was before Ontario’s court system over the issue of rezoning the islands. How can this action be seen as ethical?

The Utah bootcamp

In April 2016, two employees from Hydro Ottawa — Charles Berndt and Christopher Murphy — jumped on a plane to Utah to be part of a "lab" with Windmill’s Scott Bentley.

A fourth participant at the so-called "bootcamp for energy innovation" was Aaron Barter, a senior associate of MaRS Advanced Energy Centre, a Toronto-based green think tank that seems to be operating as an advocate and deal-maker for the Zibi development.

A year before the trip to Utah, MaRS had announced it was launching a partnership agreement with Hydro Ottawa to "bring genuinely innovative solutions to Windmill Development’s Zibi project."

MaRS also said it would help the public utility “explore new ways to integrate innovation into their business practices," which is code for circumventing regulatory regimes in Ontario that have mostly limited corporations from privatizing hydro power facilities.

In a blog post from this past summer, two MaRS employees advocated for "market-driven solutions" to energy production. "Together with Windmill Developments and the Advanced Energy Centre, Hydro Ottawa is exploring new opportunities to realize the vision of a net-zero carbon local energy system," they wrote.

Hydro Ottawa has issued no official announcement to inform the public that it has entered into any formal relationship with Windmill. Nor has Hydro Ottawa officially announced its relationship with MaRS.

The memorandum

The meeting in Utah — sponsored by a $30-million organization called The Rocky Mountain Institute and held at the pricey Sundance Mountain Resort — was designed to "further develop the business model for the district utility including the asset ownership, rate structures, investment strategy, and operations," according to an online summary:

The team discussed two ownership structures, including a "business as usual" model where the company would still own and operate all of the community’s electric utilities and a "New Co." model where a joint venture between Hydro Ottawa and Windmill Developments would act as the community’s energy provider.

If there is to be a joint venture — the so-called "New Co." — where Hydro Ottawa supplies energy to the proposed condo development on the islands, Ottawa taxpayers should be aware of this public-private partnership.

Furthermore, Hydor Ottawa [sic] and Windmill have signed an memorandum of understanding which defines the commitment from each organization to explore this partnership opportunity and to further develop the business opportunity together.

This memorandum of understanding, if it exists, has not been made public by Hydro Ottawa. And what exactly is the business opportunity? If it involves a publicly funded utility helping the Zibi project meet its goal of a zero-carbon footprint by 2020, this goes beyond Mayor Watson’s cutting of red tape. It may involve public money spent on a hydro expansion project helping a private company meet its green marketing goals.

Dream Unlimited’s energy connection

Before the Utah bootcamp, another meeting had occurred between MaRS, Windmill, and Hydro Ottawa. MaRS brokered this event in May 2015, using its partnership with Hydro Ottawa to introduce Windmill and its corporate partner with deep pockets, Dream Unlimited Corp., to staff from the public utility.

Dubbed a "charrette," the event created a tripartite relationship, with the logos of Hydro Ottawa, Dream Unlimited Corp., and Windmill Development Group appearing together in the event report.

The addition of Dream Unlimited to the mix points to a disturbing possibility: that the real estate giant’s endgame in partnering with Windmill on the Zibi project is to eventually gain control of Energy Ottawa, the private company that is a wholly owned subsidiary of Hydro Ottawa.

Dream Unlimited owns a renewable energy subsidiary, Firelight, described in the company’s literature as a fund that “invests in and manages renewable power projects with a focus on wind and solar projects. Dream has and intends to pursue growth in the renewable power industry through Dream Alternatives in the future.”

A 2014 report from Dream Unlimiteddescribes Firelight’s role in green infrastructure investments:

Firelight continues to make early development investments; however, recently Firelight has identified later stage opportunities or development opportunities where Firelight’s capital is committed and not drawn down until the projects are operational or are drawn down on a staged basis.

This approach points to Firelight’s interest in investing in projects that are already up and running — such as the hydro-generating facility at Chaudière Falls, adjacent to the condo project that its parent company is developing in a partnership known as Dream Windmill.

Green capital seeks water

Green corporations — especially those that believe their brand of capitalism will save the planet from climate change — decry the "regulatory regimes" that prevent them from getting their hands on hydro facilities.

“Key barriers to innovation in the [energy] sector are generally non-technical, such as a culture of risk aversion, government-led direction,” wrote the two MaRS employees in the summer blog post mentioned earlier. “Opening space for innovation requires providing a means to reward risk and promoting market-driven solutions.”

An ideology in support of market-driven solutions has found favour with Ontario’s Liberal government, which has agreed to the privatization of Hydro One.

As a short review of history shows, this move would make proponents of public electricity in Ontario in the early 1900s shake a fist from the grave:

During the Ontario Provincial election of 1905, the main issue became "Niagara Power". From the urging by Adam Beck, Mayor of London Ontario, the Provincial Conservative Party ran on an election platform of "water power of Niagara should be free".

The Conservative Party won the election and Premier James Whitney immediately announced that no further private franchises would be granted for the generation of hydro-electric power at Niagara Falls. Whitney brought Adam Beck into his Government and named him the chairman of the newly created Ontario Hydro Electric Power Commission. It became the worlds [sic] first publicly owned power authority.

Like Niagara Falls, whose natural power was used to fuel the growth of industry, Chaudière Falls has done its duty by generating power for the likes of E.B. Eddy and Domtar Inc. since the dam was constructed in 1908.

Energy Ottawa’s expansion can be seen as a step backward if the power it produces ends up in the hands of a private corporation. Algonquin First Nation chiefs opposed to the Zibi development have decried hydro developments on the Ottawa River and demanded free, prior and informed consent at Akikodjiwan, their name for the sacred site.

Do residents and taxpayers in Ottawa believe that water, as a natural resource, should ever be in private hands? When water generates electricity, it can be seen as a natural resource being commodified, just as when groundwater is bottled by multinational companies such as Nestlé.

In the early 1900s, public opinion favoured public ownership, public control and public distribution of electricity. Companies like the Toronto Electric Light Company, according to a history of the time, "almost had a monopoly on supplying electricity to cities. This company was over-charging its customers for electricity and being selective as to how much power a particular industry would get."

In the 21st century, public sector unions, municipalities and academics are speaking out against the privatization of Ontario’s water resources. Last week, Christo Aivalis, an adjunct professor of history at Queen’s University, in an article referring to the end of private ownership of Niagara’s water resources, wrote that having electricity owned privately— "either by foreign interests, domineering monopolies, or a patchwork of petty capitalists" — does not serve the public interest.

At the condo site proposed for the islands in the Ottawa River, an elite group of citizens could be assured a steady supply of electricity should the developer come to own the hydro-generating facility.

On a website run by Windmill called Zibi Dialogue, the developer proclaims, "Zibi has no ability to undam the falls, or to remove the hydro facilities on either side of the river."

It could be that Zibi’s owners have no desire to do either of these things because Windmill’s ability to sell condos as "green" thanks to a ready supply of hydroelectricity is being handed to them on a silver platter by a municipal power utility.

Debra Huron is a citizen of the Métis Nation of Ontario and an activist who cares about the trees, water, and land in the territory where she lives — unceded Algonquin territory, which includes the Canadian nation’s capital city.

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