Fast Forward to Wind
By Dick Flanagan, Publisher
Canadians support development in wind energy. “The results from the Strategic Council survey show that 87% of Canadians support the 20 percent by 2025 wind-energy vision,” said CanWEA President Robert Hornung. “This target would generate $79 billion (cn) of investment in Canada by 2025 and would make the Canadian wind-power sector a major player in an international wind-energy market valued at $1.8 trillion. Development on this scale would create 52,000 full-time jobs. The strategy would reduce Canada’s annual greenhouse gas emissions by 17 megatonnes annually by 2025.
Hornung, who has served as CanWEA’s president since 2003, went on to say that CanWEA is asking federal and provincial governments to quickly implement policies and programs that will address some of the current roadblocks to the development of Canada’s wind-energy potential. The industry is asking government to assign fair value to the positive environmental impacts of wind energy, and encourage the production of wind turbines in Canada. That transmission infrastructure will be planned and built taking wind energy into consideration, and that the process for granting and approving permits for wind energy projects be streamlined.
Since 2003, Canada’s wind energy market has expanded six-fold and Hornung sees a minimum of 12,000 MW of wind energy installed in Canada by 2016. This year has also been important in laying down prospects for the future with the establishment of an industrial base. German turbine makers Enercon and RePower will set up manufacturing facilities in Quebec. AAER began assembling nacelles at its factory in Bromont, Quebec.
Bringing more manufacturing supply chain to Canada is key to maintaining political support. “Look to the United States!” Hornung said. “At least 41 new or expanded manufacturing facilities, representing $1 billion in investment, have been built or announced since 2007.” The United States now produces more wind energy than any other country in the world and they are adding capacity faster than anyone else-well over 12,000 MW in 2007 and 2008 alone. In fact, the US has built more wind energy capacity over the last four years than any other form of generating technology except natural gas. And the US Department of Energy recently completed a two-year study that concluded that the US could reach 20% wind energy penetration levels by 2030 at an incremental cost of 50 cents per month on American utility bills. “Shouldn’t we be exploring these options in Canada?” queries Hornung.
“Look to Spain as well” he says. In 2000, there were 1000MW’s of wind energy. Today, the Spanish are adding about 3500 MW of new wind energy capacity per year, have more than 15,000 MW in total, and generate more than 13% of their electricity from wind.
“We also see that Denmark tops the charts in terms of wind penetration levels,” he added. The Danes get 22% of their electricity from wind and during off peak hours, there are times when every single bit of electricity consumed in Denmark comes from wind. “But look at some of the other countries ahead of Canada-Greece, Ireland, Sweden, Austria, the Netherlands, India. Shouldn’t Canada be able to compete with these countries in the global wind energy marketplace?” Hornung asked rhetorically.
He added that in Canada, the federal government’s $0.01/kWh ecoEnergy for Renewable Power incentive has been an important stimulus for wind energy development. If Canada is to become a more attractive destination for wind energy investment, and for the wind industry’s remarkable growth to continue to accelerate, action will be required to extend and expand the program in the 2009 federal budget. CanWEA is asking for a $200 million/year commitment that would support an additional 8,000 MW of renewable energy development and extend the program deadline to March 31, 2014.
Canada should see wind energy as a strategic opportunity with a number of strategic advantages relative to other countries that provide a solid foundation for Canada to compete for global wind energy investment.
Another advantage in Canada is hydroelectricity representing 60 percent of the electricity supply and is an excellent partner for wind energy. Hydro production can be adjusted to balance out variations in wind energy supply and vice versa. Wind energy production peaks in the wintertime when hydro reservoirs are hard to fill and wind can be used to help better manage hydro resources.
Canada Needs To Export
“Export opportunities are another plus for Canada’s wind power industry,” he said. We sit next door to the world’s largest electricity market and the Americans have a growing appetite for green power. In fact, 30 American states have now adopted Renewable Portfolio Standards requiring a certain portion of their electricity must come from renewable sources.
CanWea has called for a price on carbon that will allow wind energy to get full value for its greenhouse gas emission reduction benefits. Hornung pointed out that carbon taxes are in place in BC and Quebec and greenhouse gas emission offsets are in place in Alberta.
Another challenge is to ensure governments don’t equate a carbon pricing strategy with a renewable energy strategy. The European Union, for example, has one of the most advanced systems in the world for pricing carbon through its cap and trade system as well as an aggressive renewable energy target and strategy that allows it to tap into all the other benefits wind energy brings.
Getting the policy framework right is important not only to gain the confidence of manufacturers, but also of investors. Between 2008 and 2020, it’s expected that more than $1 trillion will be spent worldwide on new wind energy installations and that money is going to go where it gets the best return. Canada’s ecoENERGY incentive is already less than half the value of the US production tax credit, representing a clear advantage for our main competitor for wind energy investment, Hornung said. A price on carbon will bridge some of the gap between wind energy and conventional energy sources in US and Canadian projects, but it will still be some time before Canadian wind energy projects are competing on a level playing field.
Regulatory processes are underway to review transmissions proposals that will allow both Alberta and Ontario, to access thousands of new megawatts of wind energy resources. CanWEA has been active in both provinces providing detailed input on transmission options.
Wind developers are also facing challenges on the permitting front. One of the benefits of wind is that it can be built quickly, but approval processes are becoming longer and more demanding.
The importance of community engagement and communication in successfully navigating the approvals process is paramount. CanWEA launched a number of initiatives to provide new tools to project developers to assist in this process.
“It is true though that we have some catching up to do. Although Canada has the 6th largest electricity system in the world, we rank 11th in installed wind energy capacity and 16th in wind energy penetration into the electricity grid,” Hornung concluded.