The Ontario government, which less than a month ago chose the companies that will build the next set of wind and solar farms in the province, has now started the competitive process for another round of renewable energy projects.
The province plans to sign more contracts for up to 930 megawatts of renewable power – 600 MW of it from wind, 250 MW from solar, 50 MW from hydroelectric power and 30 MW of bioenergy.
Like the past round, contracts will go to go to those promising to sell power for the lowest price – although factors such as community support, local energy needs and participation by aboriginal communities will also be taken into account. The new contracts will not likely be signed until mid-2018.
The projects announced in March involved 11 companies that were offered 16 contracts to build five new wind projects, seven solar projects and four hydroelectric projects, for a total of 455 MW of new power capacity.
The prices in these contracts were far below what the province paid for power under the old feed-in tariff program, which was established almost a decade ago to encourage a shift to renewables. The cost of wind and solar technology has fallen, and the need for more power projects has slowed, so the new system of competitive pricing for large projects reflects that.
Ontario Energy Minister Bob Chiarelli said in a speech to a wind power conference in Ottawa on Tuesday, that the price for wind power – about 8.6 cents a kilowatt-hour on average under the March contracts – is "now on a level playing field with other forms of generation in Ontario."
He also said that more than three-quarters of contracts offered in March had support from local municipalities, a contrast from the "large degree of anxiety" expressed by rural communities over wind developments a few years ago.
However, not all of the the wind contracts awarded in March were welcomed. The municipality of Dutton/Dunwich, on Lake Erie near London, Ont., had declared itself an "unwilling host" for wind turbines, yet developer Invenergy LLC was awarded a contract to build a 58-MW wind farm in the area.
Some critics have said Ontario does not need any more generating capacity, but Mr. Chiarelli said the power from the contracts awarded this year and in 2018 will come online while the province's Bruce and Darlington nuclear generating stations are undergoing refurbishments, thus helping to meet power demand when it is needed.
There is already more than 4,000 MW of wind capacity and 2,000 MW of solar power in Ontario, out of a total generating capacity of around 36,000 MW.