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Winds of change require backing of government RFP, developer says (01/04)

If the McGuinty government is going to make good on its commitment to shut down coal-fired plants by 2007 and deliver more renewable energy to consumers, they need to come out with a policy this winter to encourage green energy developers and the inv

If the McGuinty government is going to make good on its commitment to shut down coal-fired plants by 2007 and deliver more renewable energy to consumers, they need to come out with a policy this winter to encourage green energy developers and the investment community to get on board, says a Northern Ontario wind park developer.

David Boileau, an Atikokan-based developer behind a proposal to build a $180-million large scale wind park near Sault Ste. Marie, says the government is going to have to act quickly if it plans on bringing in new sources of renewable energy faster than what the Conservatives were calling for.

They must do that in the form of a request for proposal (RFP) asking for competitive bids on a major project of more than 400 to 500 megawatts to help kick-start the wind energy industry in Ontario, he says.

Boileau, vice-president of Superior Wind Energy and chairman of the Ontario Wind Power Task Force, along with about a half a dozen other serious developers of wind power in Ontario, are optimistic the government will act soon. Boileau’s predictions stem from conversations with the Energy Minister Dwight Duncan’s office and his counterparts in the renewable energy industry.

Government action needed

“We think the government needs to move very quickly if they’re going to meet their commitment to bring over 27,000 megawatts of new renewables by 2010,” says Boileau, including 13,500 megawatts by 2007.

“Commitments are great, but the devil’s in the details,” Boileau says. “Show me the legislation and show me the magic words, RFP, because that’s what we can finance projects on.”

Since capital costs for wind power projects are very high, front-end capital costs because of environmental assessments, approvals, building foundations, erecting of towers and turbines, and connecting transmission lines, projects cannot be financed on the basis of the Ontario’s fluctuating electricity spot market, Boileau says.

What companies like Superior Wind Energy are looking at is a long-term power purchase agreement from a customer, most likely the provincial government, to provide a steady source of revenue to the project for wind park proponents to service their debt.

To deliver energy on a major 400 megawatt renewable energy project within the government’s timelines, Boileau says his company would need at least three-and-a-half years to secure the bulk of their investment commitment and would need to know the province’s intentions by at least February.

Boileau says the Liberals need to make good on the previous government’s commitment to implement a Renewable Portfolio Standard, a proposed provincial law requiring electricity retailers to purchase a certain percentage of their power from renewable resources. That would also act as a stimulus to the wind energy industry.

Boileau’s company, a joint venture between Brascan Power and Harmony Wind Energy of Atikokan, has a number of wind projects under consideration on Manitoulin Island, near Collingwood and Kingsville in southwestern Ontario.

“Public policy commitments of this government are crucial to getting this project off the ground.”

There also needs to be substantial upgrades to the transmission corridor in Northern Ontario since most areas can feed only about 100 megawatts through the system.

Many favourable spots for commercial-sized, large-scale wind parks exist along the northern and eastern shores of Lake Superior, but there are transmission line constraints. There are also concerns on the part of developers over whether or not the province will allow for wind parks to be developed along the Great Lakes Heritage Coast and places where provincial parks are being advanced.

Boileau asks if it is unreasonable for taxpayers to pay for extensions to transmission lines into wind parks.

Boileau also wants better co-ordination between the various line ministries - Energy, Natural Resources, Environment, Northern Development and Mines and Agriculture - in carrying out the province’s long-term strategy on renewable energy.

He is calling for an appointment of a renewable energy secretariat to co-ordinate these activities, including releasing a policy paper on water power capacity on Crown land, something the renewable energy sector has been waiting years to see.

Near Sault Ste. Marie, Boileau’s company is positioning itself to move forward having recently erected a second meteorological tower on the site where his company plans to build a wind park of up to 200 megawatts, located northwest of the city near Lake Superior.

Boileau says the project is almost through its environmental assessment process and more than halfway through the permitting stage.

The two meteorological towers and an expanded Doppler Radar program are part of the project’s overall wind assessment data gathering package, which Boileau says is critical in knowing where to place their turbines to make maximum use of the wind.

The project also received Ministry of Transportation approval for an entrance off of Highway 17, north of the city.

The two-stage Prince Wind Park project, located on 17,000 acres of land under lease agreements with mostly private landowners, would involve between 55 and 66 turbines at each stage of 1.5 to 1.8 megawatts, each with the towers being between 75 and 85 metres above ground.

Private landowners in Prince, Pennefather and Dennis townships stand to get a share of gross electrical proceeds, which amounts to two per cent of electricity sales to whomever the buyer is. On a parcel of land, such as a quarter section of 160 acres, a landowner could haul in between $25,000 and $40,000 a year in an area with good wind values.

Boileau says the wind park would provide a “big boost” in land values to property owners not located on the coastline where the area’s only other primary use is hardwood logging.