Ontario's Growing Pains: Will the Wind and Solar Industries Scale-up in Time?

[jpak]

http://www.renewableenergyworld.com/rea/news/article/2010/08/ontarios-growing-pains-will-the-wind-and-solar-industries-scale-up-in-time

With the Green Energy and Economy Act (GEEA) last May, the Ontario government launched the most ambitious feed-in tariff (FIT) program for renewable energy development in North America. The combination of stable prices under 20-year contracts for renewable sources is resulting in a groundswell of green energy development in the region.

Around 600 renewable energy developers have received FIT contracts since March, which translates to roughly 2600 MW of generation capacity. Now with the first round of FIT projects underway, and many awaiting approval, developers and suppliers are looking for clarity on the region’s ability to deliver robust and sustainable wind and solar supply chains.

The other important goal of the GEEA is to generate 50,000 jobs for Ontario in three years. The FIT program includes specific domestic content requirements as a means of job creation and establishing Ontario as a green manufacturing hub. Wind projects must reach a 25% domestic content level now, bumping up to 50% post-2012. For solar, the requirement is 50% currently, jumping to 60% next year. The concern for renewable energy developers is that the capacity simply doesn’t exist in Ontario today to meet the increased 50% and 60% thresholds. Suppliers too are wondering who is going to step into the market to provide Ontario-made renewable energy technologies and services.

“The challenge is our ability to meet those domestic requirements based on the current capacity within the supply chain in Ontario as well as the ability of suppliers to get established and begin rolling out product in time for us to meet our timelines,” explains David Timm, Vice President of Strategy Affairs at International Power Canada, which currently has two wind projects approved under the scheme.

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