The Ontario government’s decision to nix over 700 solar, wind and hydroelectricity projects on the grounds that they drive up electricity prices is nonsense and will ultimately drive innovation out of the province, according to renewable industry players.
Doug Ford’s government said that the move, first announced in mid-June, will save $790 million for Hydro One customers.
The large majority of the axed projects are small-scale community solar projects, part of the province’s feed-in tariff program, where participants could generate small amounts of renewable energy and sell it back to the province.
John Gorman, president of the Canadian Solar Industries Association, said there is a “disconnect” between the argument to pull out of these agreements on the grounds that it would make electricity bills cheaper for “the little guy” and the fact that the contracts boosted local economies and reduced participants’ electricity bills.
Blocking solar from the grid
“It’s the local installers, contractors and engineers who are being purged by this decision. They're the ones who are losing their jobs,” he said.
“And the farmers, municipalities and schools that were expecting to be putting solar on their roofs to save money on their electricity bills are also really angry right now.”
Roughly 6,000 people are employed in the solar industry in Ontario. But, if the government continues on its anti-renewables path, Gorman predicts that these jobs will “go to other provinces across Canada and the United States.”
Ten of the projects axed by the government were larger scale hydroelectric, solar and wind projects that comprised the last round of the province’s renewable energy procurements.
One was the Eastern Fields wind project, a nine-turbine farm slated to go up in La Nation and Champlain.
“They nailed us at the exact, most expensive, least compensatory position,” said Peter Clibbon, senior vice-president of RES-Canada, the firm running the project. According to him, the company had invested around $3 million in the 32-megawatt project to date but will receive only $400,000 in compensation for their loss.
“What we find confusing is that the projects that they cancelled were competitively procured, and actually below the average price of electricity of Ontario. They were competitively priced,” he added.
Moving forward, he said, the company will be “focusing more on other jurisdictions in Canada and in other countries, given that Ontario is sending a very negative signal to the independent power market — which it desperately needs to provide clean power in the next decade.”
“We develop these projects in good faith, signing with a counterpart we believed wanted the power, and wouldn't exercise its termination rights because a politician told them to. It gives us a little less faith in the province of Ontario's ability to respect contracts,” he said.
Ontario missing out on energy revolution
Mark Winfield, co-chair of the Sustainable Energy Initiative at York University, said the Ontario government’s decision to prioritize the refurbishment of old nuclear plants instead of investing in renewables puts Ontario in an uncomfortable “technological lock-in.”
“We are in the midst of multiple technological revolutions around storage, around smart grids, around the cost and performance renewables, across energy efficiency. . . . Right now is not the time to be technologically static in the electricity sector,” he said.
Winfield said the belief that renewables are expensive is “in large part myth, flowing a bit from the original feed-in tariff program in Ontario, where the rates paid for solar were in some instances very high.”
His statement was echoed by Gorman, who said “the renewables myth here in Ontario has been corrupted. There’s a sense that renewables are very expensive; it started with the introduction of the Green Energy Act in 2009. Renewables got labelled as an expensive electricity-generating technology, and the industry has been unable to shake that narrative. And of course, it's not the case.”
According to National Renewable Energy Laboratory, a research group funded by the United States Department of Energy, the cost of solar has declined by 86 per cent in the last seven years.