Tag Archives: offshore wind

Offshore wind opportunity grows in the Great Lakes, but not in Ontario

Is the offshore wind opportunity in Ontario permanently dead in the water?

It was in February 2011 – an election year—when the Liberal government abruptly killed the ambitions of any wind developer looking to place wind turbines in the Great Lakes. It booted offshore wind out of the feed-in tariff program and it suspended all applications, citing the need for more scientific research until, in the words of the environment minister, there is assurance “any offshore wind developments are protective of the environment.”

That’s a pretty high standard. Can any energy development really protect the environment?

Never mind that government scientists have been studying the issue since at least 2007, or that when a previous moratorium on offshore wind development was lifted in 2008, then-premier Dalton McGuinty was convinced that such developments could be done in a way that would not compromise ecosystems.

But more studies were needed. Fair enough.

So where are these studies?offshore

As the Star’s John Spears reported last month, three studies were posted on the Ministry of Natural Resources’ website in February – two dealing with impacts on aquatic species and fish habitat, and one a more comprehensive engineering impact study.

Strangely, all three were completed and submitted to the government in spring-summer 2011. It’s not clear why it took 18 months for them to become publicly known, or what has been done since then.

It’s also not clear how many more studies are coming, what kinds of studies are still needed, when they will all be completed, and if, once completed, the ministry has any intention of reconsidering the moratorium.

“We still need to gather more information.” That’s all ministry spokesperson Jolanta Kowalski was prepared to answer when repeatedly asked the questions. The natural resources ministry, she added, “will work with the Ministry of Environment and other agencies to help determine future research and science priorities and activities.”

In other words, there’s no rush. They’re still determining. Still gathering. I can’t remember any other energy source being put through so much study for so long before a single kilowatt was produced, except perhaps the kind that creates highly radioactive waste.

Here’s some perspective: two years ago Ontario was in a strong position to lead the world on freshwater offshore wind development, attract a major turbine manufacturer, establish a compelling local supply chain, and create many thousands of jobs. Today, the government is being sued for billions of dollars for turning its back on this potential, not to mention the investors it originally wooed.

Meanwhile, Ohio has picked up the slack. The non-profit Lake Erie Energy Development Corporation (LEEDco) received $4 million (U.S.) last month from the U.S. Department of Energy that will go toward engineering, design and permitting work for its “Icebreaker” offshore wind project.

Icebreaker will be a five-turbine (possibly nine) offshore wind farm located about 11 kilometres off the shoreline of Cleveland. It will have the potential to generate more than 20 megawatts of electricity, and will be a first-of-its-kind in North America.

Turbine manufacturer Siemens, wind developer Freshwater Wind, Case Western Reserve University and municipal governments in the area are partners in the project. LEEDCo’s goal is to see 1,000 megawatts of offshore wind developed by 2020 within Ohio’s jurisdiction.

That could have been us. Note that Siemens used to have an interest in partnering up in Ontario until we abandoned all talk of offshore wind.

Is it that the studies Ontario has conducted to date suggest the risks to the environment and health are too high to proceed? No. They do highlight some real risks, but they also draw attention to the many benefits and point out ways to minimize the risks.

“If care is taken to properly site project locations, avoid sensitive habitat areas, employ available options or continue to develop new options for mitigation, and conduct appropriate biological monitoring, the potential impacts of offshore wind power production could in fact be minimal,” concludes one of the studies from the natural resources ministry’s own aquatic research group.

The study goes on to talk about the limitations of doing lab and computer-model studies. “We cannot fully understand the environmental impact that a wind power project will have until we are able to study the response of the local system to the construction and operation of an actual installation in the field.”

It suggests that the next step be small-scale pilot projects, at minimum. “Ultimately, however, the greatest and most valuable knowledge would be gained through focused research and monitoring at commercial-scale demonstration projects throughout the construction phase and over the long-term during operation. Looking ahead, collaboration between government, industry and academic partners to plan and initiate this type of project would be highly valuable.”

That’s exactly what the Ohio consortium is doing.

Nobody is saying that Ontario should run out and develop 1,000 megawatts of wind tomorrow. But the current surpluses being experienced in the province’s electricity system won’t last forever. Coal generation will be gone within the year. Aging nuclear reactors will soon enough be taken offline for refurbishment or decommissioning.

The power crunch will come. Offshore wind, responsibly developed and set back far enough from the shore, could be an important part of Ontario’s clean energy mix. If we need more research, maybe it’s time we actually dipped our feet in the water and actually built something we can properly study.

Or we can just look over our neighbour’s shoulder.

Tyler Hamilton, author of Mad Like Tesla, writes weekly about green energy and clean technologies.

Ontario needs to reconsider offshore wind in the Great Lakes, though it may need a different approach

My Clean Break column this week takes a look at Ontario’s decision back in February to put a moratorium — once again — on the development of offshore wind in the Great Lakes, and argues the province should reconsider development of this resource even if this time around it takes a more measured approached.

My own beef with the February moratorium is that the government cited environmental concerns that were supposedly addressed in a previous round of studies done prior to the lifting of the last ban in January 2008. At that time, Premier Dalton McGuinty announced that environmental studies had been done and, in his mind, “you can do it in a way that does not compromise ecosystems.” At that point, he fired a starting gun for industry and, to stimulate interest even further, the government included offshore wind in its feed-in-tariff program. Three years later — i.e. this past February — the plug was pulled once again. Turns out Ontario was jerking the industry’s chain.

Now, I can understand the desire to pull back a bit. One could easily argue that the government moved too fast by including offshore wind in the feed-in-tariff program. But why completely halt all development, indefinitely, especially when jurisdictions such as Ohio are pushing ahead? Why go so far as to tell all developers that if and when offshore wind is put back into play, they have to start from scratch (effectively rendering all past site-specific research and studies useless)? It made no sense.

Anyway, as you’ll read in the column, I think the government needs to reconsider its decision. Perhaps a way back into it is to start by focusing on a pilot project, maybe 50 to 100 MW in size, developed far enough offshore that it wouldn’t get the NIMBYs all worked up. This could be the basis of real-world study, during which new rules can be set making a distinction between near-shore and truly offshore resources, and bringing clarity to a new market craving guidance.

To simply sit back and let U.S. jurisdictions take the lead — and future manufacturing and job creation — isn’t fitting of a province with the most to gain from offshore wind development in the Great Lakes, and the most to offer.

Ontario loses spine and backtracks on offshore wind, a HUGE mistake it will regret

The Ontario government, to my surprise, has caved to public pressure from a small group of anti-wind folks and backtracked on its previously stated commitment to encourage the development of offshore wind in the Great Lakes. It must be election time. This news release just came out:

Ontario is not proceeding with proposed offshore wind projects while further scientific research is conducted. No Renewable Energy Approvals for offshore have been issued and no offshore projects will proceed at this time. Applications for offshore wind projects in the Feed-In-Tariff program will no longer be accepted and current applications will be suspended. Offshore wind in freshwater lakes is early in development and there are no projects operating in North America. The recently installed Lake Vanern pilot project in Sweden is one of the only operational freshwater offshore projects in the world and a pilot project has been proposed in Ohio. Ontario will monitor these projects and the resulting scientific knowledge. Ontario will work with our U.S. neighbours on research to ensure any future proposed projects protect the environment on both sides of the Great Lakes.

It was three years ago when McGuinty confidently lifted a moratorium on offshore wind projects and declared that such projects, after extensive study and consultation with authorities on the U.S. side of the Great Lakes, could be done responsibly without impact to lake ecosystems. Then came the feed-in-tariff (FIT) program less than two years later, which broke new ground in North America by including a FIT rate for offshore wind — 19 cents per kilowatt-hour compared to 42 cents for large-scale solar projects.

The government has regularly trumpeted its commitment to offshore wind development, and Ontario was well positioned to lead North America in terms of attracting manufacturers and a supporting supply chain that could serve Ontario and the U.S. northeast. One project, to be developed by Windstream Energy, was actually offered a contract under the FIT program, while developer Trillium Power was quite advanced with its project development and preliminary studies and had worked hard to attract foreign manufacturers to Ontario. These companies and others must be furious, having invested millions of dollars already only to have the province do an about-face. I mean, is McGuinty admitting that the consultations and study done three years ago were bogus?

This sends a horrible message to the market. If the government can so easily backtrack on previous commitments, what’s next? What other projects will have their plugs pulled?

Offshore wind was the one truly new opportunity in green energy where Ontario had the opportunity to lead and capture the economic development that would come with it, as this Conference Board of Canada report recently pointed out. Companies such as Siemens and Vestas were seriously eyeing Ontario as a place to lay down their North American anchors. That opportunity is now gone. What’s odd is that it’s apparently okay to have a company like Talisman drill for natural gas in the middle of Lake Erie or to ship radioactive material from a nuclear plant through the Great Lakes, but we can’t erect wind turbines with proper setbacks from shore?

Meanwhile, the U.S. is picking up steam on offshore wind. Just as Ontario is backing away, Maryland is moving forward with legislation that would require its utilities to purchase offshore wind capacity. Virginia is getting its act together, as is New Jersey. The Obama administration has pledged to fast-track offshore wind projects in the mid-Atlantic. New York, Ohio, Michigan and others are all moving forward. Ontario, which had the lead, has decided to disqualify itself from the race and watch from the sidelines.

A truly shocking and disappointing development. There’s no reason why the government couldn’t have honoured its FIT commitments but put in place regulations that made sure only the best sited projects got built. At least this would have got the ball rolling, even if it was just one or two projects that qualified. Environmental concerns can be addressed without having to outright derail the train.

Ontario could see enormous economic benefits pursuing offshore wind in Great Lakes

The Conference Board of Canada came out with a report today that assesses the economic benefits to Ontario of developing offshore wind in the Great Lakes. Here’s my story in the Toronto Star. Specifically, it estimates job creation and the boost to GDP that would occur by developing 2,000 megawatts of offshore wind projects between 2013 and 2016. This, the board said, is a conservative estimate — much more could be developed over time. But even at just 2,000 megawatts, it estimated the creation of at least 55,000 person-years of employment and at least a $4.8-billion boost to the province’s GDP. This amount of offshore development would also attract more than $10 billion in private investment. Mind you, this is all based on a minimum local content requirement of 55 per cent. As of Jan. 1, 2012, Ontario will have a 50 per cent local content requirement for wind — so the assessment isn’t far off reality.

I like the idea of pursuing offshore wind, and here’s why: It’s new. It’s a chance for Ontario to be a true pioneer in North America by establishing an early foothold. With solar and onshore wind we’re playing catchup, we’re competing with Silicon Valley and the Chinese, and we”ll never truly be a centre for innovation and manufacturing. With solar we’re also vulnerable when subsidies dry up, as jobs and manufacturing are more mobile. 

With offshore wind, however, we benefit immediately by our geography. Ontario borders all but one Great Lake. Of all bordering jurisdictions Ontario has the most offshore development potential. Ontario has concrete and steel making, the skills and the infrastructure to support an embrace of offshore wind manufacturing and supporting services. A good deal of the supply chain could be established here. As the conference board report attests, the job creation potential is strong and we can leverage existing industries and also boost the more mature onshore wind market in Ontario.

Ontario already has a feed-in-tariff for offshore wind — the first on the continent — that offers 19 cents per kilowatt-hour, less than half the cost of developing multimegawatt solar projects in Ontario. It’s consistent with what Massachusetts utility National Grid has agreed to pay for offshore wind power from the Cape Wind project (18.7 cents U.S. per kilowatt-hour). This may sound expensive, but as some have said, this is an investment in a modern-day Niagara Falls. It might sound like a lot today, but it’s creating an infrastructure that decades from now will look cheap by comparison. Also, new nuclear power plants aren’t expected to be much cheaper.

Here, by the way, is a brief report on what’s going on in Europe and along the U.S. Atlantic coast, courtesy of Forbes blogger William Pentland.

I want to emphasize that this Conference Board report was sponsored by Vestas SA, which has an interest in entering the North American offshore wind market. The Conference Board, however, has a strong reputation for being independent, non-partisan and objective with its research. I guess such a report wouldn’t have been done had someone in the industry not stepped up to pay for it. I don’t think the Conference Board has anything to gain by writing a pro-offshore report; it would consider its credibility as an organization much more important. With that, I’m willing to trust that its conclusions are completely independent.

Offshore setback for Ontario side of Great Lakes a true setback for some developers

Just like that, a 200-megawatt offshore wind project proposed by utility Toronto Hydro is — to put it bluntly — dead in the water. Ontario’s Ministry of Environment issued a proposed regulation today that would prohibit the development of offshore wind projects that are 5 kilometres or closer to shore. Toronto Hydro’s project would place up to 60 wind turbines between two and four kilometres from shore, so if the proposed rules get passed then the utility’s offshore plan will be terminated. Toronto Hydro’s isn’t the only project that will be killed. There were several “near shore” projects proposed in Lake Ontario and Lake Erie that will be caught in this new setback rule, and even some projects that straddle the five kilometre barrier. Windstream Energy, for example, which is the first developer in North American to get a power purchase agreement for a 300-MW offshore wind farm (i.e. it got a feed-in-tariff contract with the Ontario Power Authority), may have to readjust the layout of its proposed project and drop a few turbines to fit within the rules. Trillium Power, which has a huge 700-MW project proposed for Lake Ontario, wouldn’t be affected because its turbines will be located 17 to 28 kilometres offshore.

I agree that a setback is necessary. I haven’t decided yet whether I think five kilometres it too far or not. I think three kilometers would have been a better compromise. The proposed rules could still change after public consultation, but for now, there are many angry offshore wind developers out there who face the prospects of seeing their projects killed. Toronto Hydro, for example, just spent $1 million or so to put an anonometer in the lake to measure wind speeds for two years. That now looks like wasted dollars.