Wind Developers Look to Ontario Rather than U.S.

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Researched by Industrial Info Resources (Sugar Land, Texas)--Ontario is now the safe harbor for renewable energy developers trying to weather the storms of uncertainty surrounding the current economic downturn, as well as the U.S. Congress' inability to extend the federal Production Tax Credit (PTC), scheduled to expire December 31, 2012. The PTC pays developers 2.2 cents per kilowatt-hour (kWh) from the production of electricity from utility-scale wind turbines, though solar developers can use a 30% federal investment tax credit to assist in financing their projects through 2016.

The Ontario Power Authority's (Toronto, Ontario) recently revised feed-in-tariff (FIT) program is a similar program, but more robust--paying developers 11.5 cents per kWh for wind energy projects of any size, as well as 34.7 cents per kWh for ground-mounted solar photovoltaic energy projects of more than 5 megawatts (MW) in size.

The Ontario Power Authority currently has 4,125 MW of renewable energy operational and 6,255 MW under development contract. As of the end of 2011, the Ontario FIT program had executed 1,968 program contracts with a combined capacity of 4,620 megawatts (MW). The Canadian Wind Energy Association (CanWEA) expects that 5,600 MW of new wind energy capacity will be installed in Ontario by 2018, which leaves a lot of opportunities for developers to ride out the storm here in the U.S.

NextEra Energy Incorporated (NYSE:NEE) (Burlington, Ontario) recently announced the selection of 288 wind turbines produced by General Electric Company (NYSE:GE) (Fairfield, Connecticut) for six windfarms the company is developing in Ontario.

For more information, see May 15, 2012, article - GE Wins Big Canadian Wind Turbine Order from NextEra Energy Resources.

Canada experienced a record year in 2011 with the addition of 1,267 MW of new wind energy projects. New records are expected to be broken in 2012 and 2013. Other Canadian provinces are looking at Ontario's FIT program as a model for their own. For example, Nova Scotia's Community Feed-in-Tariff (COMFIT) program was established to increase supply from renewable power sources to 25% by 2015 and 40% by 2020 in the province. British Columbia has the BC Hydro (Vancouver, British Columbia) Standard Offer Program (SOP), which is intended to encourage the development of clean or renewable energy projects of no more than 15 MW in size. It is also intended to simplify the process in which developers sell electricity to BC Hydro. These clean and renewable energy incentives will mean project development in Ontario, and Canada, will remain robust moving forward.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.