The Ontario government will announce today that it is awarding just over $8-billion in renewable energy projects to dozens of companies, making it the biggest investment of its kind in Canadian history.
Ontario Premier Dalton McGuinty is locked in a heated race with British Columbia Premier Gordon Campbell for leadership in the burgeoning market for green-energy investments. And Mr. Campbell is manoeuvring to recapture the lead by rolling out legislation as early as next month.
The total value of the renewable energy projects to be announced today eclipses the $7-billion deal the McGuinty government signed in January with a consortium led by South Korean industrial giant Samsung Group. This time around, the government is awarding contracts to entities ranging from first nations communities to major corporations from overseas, the United States and across Canada to develop wind, solar and run-of-river hydro projects, sources familiar with the deal said.
Mr. McGuinty is counting on green energy to create jobs in the province's battered manufacturing heartland. He is vowing to create 50,000 new jobs through his Green Energy Act by luring investors with the promise of generous long-term contracts that include a guaranteed revenue stream.
The Premier also plans to close the province's coal-fired electricity plants by 2014 and replace them with cleaner sources of power.
"It really is about the future of renewable energy in this province and coal closure by 2014," one of the sources said of the announcement.
Energy Minister Brad Duguid was to be at Durham College in Whitby, Ont., this morning to announce that the province is awarding its first major contracts under the so-called feed-in-tariff program - FIT for short - which pays premium prices for renewable power.
The companies will receive a fixed price over 20 years for the electricity they produce - 13.5 cents a kilowatt hour for on-shore wind farms and up to 80.2 cents for solar power. These contracts with green power producers are well above the market price of 3.44 cents a kilowatt hour for electricity in Ontario and are leading to higher hydro bills for consumers.
The Ontario Power Authority, the government agency that runs the program, has received more than 1,000 applications from companies, the sources said. The projects will create thousands of jobs, they said.
Brookfield Renewable Power, one of the largest renewable energy producers in North and South America and a subsidiary of Brookfield Asset Management, is among those hoping for good news today.
Brookfield has several projects under development in Ontario, including two totalling 213 megawatts of capacity in Essex County on the shores of Lake Erie, and a 100-megawatt plant near the Northern Ontario town of Marathon.
The company also won a 40-year power purchase agreement from the B.C. government last month to build a 45-megawatt run-of-river hydroelectric project on the northeast coast of Vancouver Island. For that Kokish River project, the Toronto-based company is partnering with 'Namgis First Nation.
NextEra Energy Resources, the renewable energy arm of FPL Group that also owns Florida Power & Light, also applied for several projects under FIT and had high hopes for substantial growth in the province. The company applied for about 600 megawatts of wind projects.
Mike O'Sullivan, senior vice-president of development at NextEra, said FIT was such a well-designed program that it "will bring in all shades and colours of money from all parts of the world."
He said if Ontario executes the FIT program properly, it could end up as one of the top five or 10 markets for renewable power in North America, among the 60 states and provinces.