Ontario’s solar market is boomin’ baby.

California-based market research firm iSuppli came out with a report today that forecasts rapid growth of solar PV installations in Ontario, though warns of a bottleneck in production during the first half of 2011 as developers struggle to meet stricter local content requirements. In 2009 Ontari0 had 69 MW of installed PV, but iSuppli said that will grow by 272.5 per cent to 257 MW in 2010. Stricter rules requiring 60 per cent local content will kick in next year, however, and that will create a supply crunch that slows down growth until the last quarter of 2011 when local manufacturing catches up with demand. As a result, we’ll see growth of 75.5 per cent in 2011 as installations climb to 451 MW. In 2012 we’ll see that number climb past 600 MW.

Mike Sheppard, a PV analyst with iSuppli and author of the report, says companies that have set up local manufacturing in Ontario will benefit the most during the 2011 crunch. According to an iSuppli press brief, “Firms like Canadian Solar, SMA, Fronius and Silfab are stepping in to meet the demand for local solar components, building module and inverter manufacturing facilities in Ontario.”

Sheppard acknowledged that Ontario’s decision to shut down all coal plants by 2014 and its introduction of a Green Energy Act and feed-in-tariff program are driving the explosive growth in PV. He called Ontario’s FIT program “North America’s first comprehensive guaranteed pricing structure for electricity production from renewable fuels sources including solar PV, bio-energy waterpower and wind.” The program, according to iSuppli, “could have a major influence throughout North America.”

This is a positive evaluation, but I don’t think it’s as positive as it could be. As I outlined earlier, module manufacturers alone are setting up local production facilities with a combined annual capacity of more than 1,000 MW. Not all will be built, but iSuppli seems to think that actual installations will be limited to between 150 and 200 MW a year. If that ends up the case, we could end up having some major oversupply issues in Ontario by the end of 2011. But given the huge volume of FIT applications being received by the Ontario Power Authority and amounting to potentially several thousand megawatts, I’m wondering if iSuppli is low-balling its forecast.

Just days before the Ontario government is expected to officially launch its much-anticipated feed-in tariff program (FIT), Energy and Infrastructure Minister George Smitherman announced that the province — through crown-owned utility Hydro One — will spend $2.3 billion on 20 projects designed to expand and upgrade its transmission system. The investment is expected to take place over three years and create 20,000 “green-collar” jobs in the process. Many of the projects are aimed at expanding capacity along existing corridors to carry more power from the Far North where there remains an abundance of untapped wind and hydroelectric projects. But some of the money will also go toward constructing enabler lines for areas of the province where renewable-energy development clusters have been identified. It’s being called an historic investment in transmission, the largest single commitment in decades, and the government said it was important to make this commitment to signal to the market that Ontario is serious about accommodating development of green-energy projects. Indeed, it’s a wise investment to announce just before the launch of the FIT program, and just after announcing a $250-million loan guarantee program dedicated to aboriginal-owned renewable generation and transmission projects.

A description of each projects can be found here. The province has also supplied a map showing where existing lines will be reinforced and where enabler lines will be built.

Well, just three months after being tabled Ontario’s Liberal government has succeeded in getting its Green Energy and Economy Act passed into law. The bill passed by a vote of 59 in favour and 13 against, and will be effective immediately after it gets Royal Assent (a rubber stamp).

This, with no exaggeration, is an historic event in North America. The new law creates a framework for giving renewable energy and conservation priority access and consideration in the design and expansion of Ontario’s electricity system. It will speed up development by streamlining regulations and approvals and will draw more players, such as municipalities, local utilities, community co-ops, and native groups, into clean-energy projects. Programs to flow from the Green Energy Act, such as a new European-style advanced feed-in tariff aimed at stimulating renewable-energy projects, will make Ontario a major attraction for investors and will set an example for other provinces and states to follow.

“The Green Energy Act will truly set us on the path to a 21st century green economy for Ontario, one that is sustainable, easy on the environment, and focused on the jobs of the future,” said Energy and Infrastructure Minister George Smitherman.

The act has received much praise domestically and abroad. Robert Pollin, co-director of the Political Economy Research Institute at the University of Massachusetts, called the legislation “excellent.” Similar kudos have come from British economist Sir Nicholas Stern and German legislator Hermann Scheer.

Stefan Gsanger, secretary general of the World Wind Energy Association, said the law represents “an historic international milestone as the act promises to be the most advanced piece of renewable energy legislation in North America.”

It’s not perfect. It has its critics. A lot is left to be proven. But at least the path has been laid and the work can get started. Time to roll up the sleeves, Ontario.

(Note: Thanks to the University of Guelph student newspaper for the above image)

The first thin-film manufacturing plant to be built in Canada will be located in Kingston, Ontario, which is located about three hours east of Toronto. Everbrite Solar, a Toronto-based company, will license turnkey manufacturing technology from a supplier overseas — details to come later — and plans to have the $500-million facility up and churning out 150 megawatts of solar modules annually by the end of next year. The plan also includes a $25-million pilot production line that will be used by researchers at neighbouring Queen’s University to test out thin-film performance and reliability advances coming out of their solar lab. The announcement comes a few weeks after the Ontario government tabled its Green Energy Act, which gives priority access to the grid for renewables. The act is expected to pass in June.

Also announced recently was a new advanced feed-in tariff program that will see the province’s power authority pay between 44.3 cents and 80.2 cents for every kilowatt-hour of solar power generated by local projects. The highest tariffs goes to owners of residential rooftop solar systems, while the lowest goes to developers of multimegawatt ground-mounted systems. The prices aren’t set in stone, however. The Ontario Power Authority will spend the next few weeks holding stakeholder consultation to fine-tune the pricing.

Everbrite Solar’s announcement is just the latest sign that momentum is building in the Ontario market.

First Solar took over more than 200 megawatts worth of OptiSolar projects in Ontario. Recurrent Energy just purchased a solar project pipeline from Chicago-based UPC Solar that is based mostly in Ontario. SunEdison, EDF Energies Nouvelles, and Axio Power are also in the game. Meawhile, Martin Roscheisen of Nanosolar says his company is seriously considering Ontario as the location of a regional module assembly facility. Ontario’s newly proposed solar feed-in tariffs, which range from 44.3 cents per kilowatt-hour for large ground-mount systems to 80.2 cents for residential rooftop, “could tip the balance in favour of investment in Ontario,” said Roscheisen.

For more details read Toronto Star article here.