Waterloo, Ontario-based Arise Technologies Corp. announced this week that it plans to build a high-purity silicon production plant by 2011 that will supply up to 10,000 tonnes a year to the solar industry, including its own PV cell production facility in Germany. The company also said it will expand the 2012 production target for its German plant by 56 per cent to 560 megawatts.

The German facility is expected to start manufacturing a 35 MW-capacity production line later this month, making cells that are at least 15 per cent efficient. Line 2, in production in the first quarter of 2009, will increase plant capacity to 80 MW annually and produce cells that are up to 18 per cent efficient. The original plan was to work up to eight production lines, but the announcement of increased capacity will bring the number of lines to 12 by 2012, with each line becoming progressively more efficient — “more than 20 per cent cell efficiency,” the company said.

As for the Canadian silicon plant, Arise CEO Bart Tichelman said a location for the plant has not been determined. “We’re in the midst of site selection with several provinces as candidates,” he said, listing off B.C., Manitoba, Quebec and Newfoundland as possible candidates — largely because they have a lot of cheap renewable power. But he didn’t exclude Ontario, Arise’s home province. “Ontario has got some attractiveness to it,” he said. “Obviously we’re delighted with the support we’ve received from the federal and provincial governments, and it will clearly have an impact on where we go.”

Arise will be competing, in Canada at least, against Mississauga, Ontario-based 6N Silicon, which plans to manufacture solar-grade silicon in Ontario. Toronto-based Timminco Ltd. is also a big player in this space, having signed several long-term supply contracts over the past year or so, most recently a large contract with solar-cell leader Q-Cells of Germany. Arise, however, says it will focus on higher-grade silicon that achieves better efficiencies for solar cells.

If Arise can deliver, this is great news. But it makes you wonder why the company has made an announcement for something planned for 2011 and 2012, when clearly it didn’t have to. Arise has a history of making big promises or announcements promising deals a few years out, only to underdeliver or have such promises fade into distant memory. Contrast that to Vancouver-based Day4 Energy, which has laid out a more realistic plan backed by solid contracts and significant revenue growth.

Still, it’s encouraging to see the momentum building for Arise and I hope the company proves its skeptics wrong.

My Clean Break column today is based on an interview with Robert Zubrin, the author of Energy Victory and the engineer that has been most vocal about sending humans to Mars. Zubrin’s main thesis is that the Organization for the Petroleum Exporting Countries (OPEC) has been manipulating and benefitting from high oil prices and that this monopoly grip on the fossil-fuel market must be broken. He wants legislators to mandate that every new vehicle manufactured have flex-fuel capability, a move that would boost investment in and availability of biofuels and essentially water down OPEC’s influence.

Now, this is quite the contentious argument given it seems more focused on energy security than on sustainability. There’s no shortage of headlines trashing the environmental benefits of ethanol and emphasizing the impact on food prices and, in some cases, the negative environmental effects of growing corn for fuel. Mandating flex-fuel in all new vehicles would merely amplify the problems being discussed today, critics say.

I have to admit, I’m torn on this one. I see the value of biofuels, assuming our increased production of the fuel can be done sustainably, guided by regulation, and assuming we can transition quickly to cellulosic ethanol. The question is, would a flex-fuel mandate create such a huge, instant demand that all rules go out the window in order to meet this demand? Would it require we import ethanol from other countries where environmental track records are poor and beyond the oversight of North American governments?

Zubrin, I point out in the column, isn’t opposed to electric cars or plug-in hybrids — he’s actually a fan. But he also points out the reality that these vehicles are at least a few years away and that they will come with a hefty premium. Flex-fuel cars, on the other hand, could be manufactured tomorrow and would cost about $100 per vehicle. Zubrin eventually sees us driving flex-fuel plug-in hybrid vehicles — the ultimate vehicle configuration, many say.

I should point out that WWF came out this month with an excellent report titled “Plugged In: The End of the Oil Age,” which argues that the electrification of transportation is necessary to break oil’s monopoly and effectively tackle climate change. You’ll notice from my column that I cite the report, which doesn’t dispute the need for biofuels, but sees biofuels as a complement to electric cars — again, that whole concept of the flex-fuel plug-in hybrid. The report is well worth the read.

I’m curious to get your views on this issue. Should we take dramatic action now by mandating flex-fuel technology, and then go down the path of making these flex-fuel vehicles plug-in hybrids? Or, should we go directly to the plug-in hybrids and all-electrics and forget biofuels altogether?

Ontario has a number of demand-response programs in place to meet its aggressive targets for what could loosely be called peak conservation. The latest is called DR3, and it’s what you could call the highest quality demand response — contractual obligations for aggregators to reduce load demand when asked to by the province’s electricity system operator.

About 10 aggregators have applied to participate in the program, and last week Enernoc and ConsumerPowerline were the first to tout contracts with the Ontario Power Authority. Both companies, and any other DR3 participant, basically sign a five-year contract that requires them to deliver up to 25 megawatts during critical peaks to reduce stress on the grid. From what I understand, aggregators (and the individual companies they’ve signed up) stand to make some decent money from the guaranteed negawatts.

“The larger story is that there’s now a large group of very excited and interested aggregators willing to sign up and build this new demand-response industry in Ontario. That growth of a new industry I think is really an exciting story,” said Sean Brady, director of demand response and industrial programs for the Ontario Power Authority.

Companies or organizations that use 50 kilowatts or more of electricity are permitted to sign up with aggregators. “What’s interesting is that it’s a new opportunity (for organizations) to look at using energy consumption as a strategic asset, and demand-response gives you the opportunity of monetizing your assets,” said Brady, adding that this will spur development, investment and deployment in new technologies such as controls system and energy management systems. “The other opportunity is that you have a set of fresh eyes from these aggregators who are looking at your electricity consumption.”

The Ontario Power Authority plans to have 566 megawatts of demand-response in place by 2010, part of the province’s commitment to reaching 1,350 megawatts of conservation by the same year. Aggregators participating in DR3 have nine months to ramp up to their 25 megawatt limit. Brady said he expects that many will be set up by this summer.