But what fires me up most is Energy Minister Chris Bentley’s reason for the delay to 2014.  He more or less blamed the federal government for being first to impose a delay, telling the Toronto Star it was essential to harmonize with the federal schedule. “To ensure a consistent approach and to make compliance easier for consumers, retailers and manufacturers, the province proposes to harmonize compliance dates for incandescent light bulbs with the federal government,” the Star quotes an energy ministry official in a statement.

This completely contradicts Ontario’s earlier motives. Remember, it was Ontario that made the first move, announcing in mid-April 2007 it planned a phaseout of inefficient bulbs. This made it the first jurisdiction in North America to make such a commitment. Apparently harmonization of policy wasn’t a concern back then, as the federal government didn’t announce its intentions to do the same until a week later. McGuinty at the time basked in the glow of showing leadership on this issue. Leadership and setting an example mattered. Now it apparently doesn’t. Following is more important now.

British Columbia, meanwhile, announced its own planned ban after Ontario and has already followed through. That’s leadership, the same kind of leadership it showed by introducing a carbon tax.

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By Tyler Hamilton

Ontario’s new Energy Minister Chris Bentley has much to learn over the coming weeks about the province’s complex energy file, and hopefully with that learning will come some genuine listening.

It’s tempting to think that the Liberal win earlier this month was a vote of confidence in the government’s green energy strategy, warts and all.

But one could just as easily argue that the outcome of the election would have been very different if PC party leader Tim Hudak hadn’t taken such an extremely negative position against the Green Energy Act, the feed-in tariff (FIT) program and associated initiatives.

Voters, by and large, are supportive – and many quite proud – of Ontario’s green energy vision. They see that it’s the direction we must take. They also see economic opportunity by heading in that direction, if done properly. For this reason, it appears most voters weren’t prepared to let Hudak hit stop and press the rewind button.

At the same time, the fact that the Liberals only squeaked ahead in the popular vote seems a clear message that the approach behind the vision needs some fixing – and fast.

For one, the ball has been dropped on energy conservation. We know that the cost of programs that help us reduce energy consumption is much less than building new power supply. We know that investment in energy efficiency has a much faster payback, represents a permanent reduction in carbon emissions, and is a significant job creator.

We also know that widespread support for energy conservation is the best way to help ratepayers cope with rising electricity rates. After all, who cares if the rate goes up if the monthly bill stays the same?

Yes, the smart grid will help us take control of our energy use, and smart meters can encourage us to shift when we use electricity. All of this helps, but it doesn’t encourage us to use less electricity. It’s not true conservation. And trust me, we waste a lot of energy. There’s much to conserve.

The Liberals have also paid a lot of lip-service to helping seniors and those on fixed-income cope with rising energy bills, but what’s lacking is meaningful action. The Clean Energy Benefit temporarily slapped on everyone’s bills is not an answer, nor is an end-of-year tax credit on a bill that’s paid monthly.

Another fix is needed with the FIT program itself. The rate structure is terribly out of date, and the Ontario Power Authority is already late in launching its two-year review of rates paid out for solar, wind, small hydro and biomass projects.

The rates under the FIT program were first announced in early 2009 and designed to assure a “reasonable” return on investment – about 11 or 12 per cent—for developers. The problem is that technology costs shift over time, sometimes dramatically. Solar is a case in point.

A recent report from the U.S. Department of Energy’s Lawrence Berkeley National Laboratory concluded that the average pre-incentive cost of residential and commercial solar PV systems fell 17 per cent last year and a further 11 per cent in the first half of 2011.

“Solar cell prices around the world have gone down significantly,” Paco Caudet, general manager of solar module maker Siliken Canada, told me this summer. “We have brought down costs over the last five months alone by almost 30 per cent.”

You hear the same story over at Celestica, which is manufacturing solar panels and inverters in Ontario for other companies looking to comply with local content rules.

Mike Andrade, the company’s senior vice-president, echoed Caudet’s view. He said the original solar FIT rates were based on a price for panels and inverters that is now 30 to 40 per cent lower. “Developers can make a fine return on investment at a much lower FIT rate than we have now,” he said.

Yet we continue to wait for rate adjustments. In retrospect, the two-year review was a mistake. Rate structure reviews should be done annually so the program can more quickly adapt to a changing marketplace.

We might also want to ask: should developers of multi-megawatt solar projects and large wind farms be booted out of the FIT program entirely?

After all, the program was created so community cooperatives, small businesses, farmers and homeowners could participate more easily in an electricity system previously dominated by the big developers, who were the only ones with the resources to take part in a competitive bidding process.

The level of community participation hoped for just hasn’t happened under the FIT, and this may explain why the McGuinty government had such a poor showing in rural Ontario ridings. People in many of these ridings are feeling like big projects are being imposed on them and that they have little say in the process.

European studies show that there is less resistance to projects when those in the community feel they have part ownership and a voice that will be heard. The FIT needs to move in that direction.

Not to say we still won’t need the big projects. But developers of these should be required to bid against each other so that Ontario ratepayers are assured the best deal.

And that, in a nutshell, is the problem we have so far: a great green vision, but not necessarily the best deal.

There’s much room for improvement, but first the government has to recognize the need.

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

The election outcome means the admittedly far-from-perfect FIT will remain and the legislation protected, at least for a few years — enough time for these ambitious initiatives to prove their worth to Ontarians. In many ways, the fact Premier Dalton McGuinty’s Liberals were left 1 seat short of a majority government is a good thing, as it forces the government to consider and take seriously some legitimate concerns with how the FIT has rolled out and the lack of attention paid to energy conservation initiatives. The New Democratic Party of Ontario, which won 17 seats, are generally supportive of both the GEA and the FIT, but the fact they hold the balance of power could — and should — nudge the Liberal government to improve its approach.

1. The NDP has been rightly critical of the Liberals for their lack of attention to energy conservation programs, so perhaps now they can light a fire under the Liberals, which have done some important things on conservation but recently have only paid lip-service to it, despite the fact it’s the best and most permanent way — from both a cost and environmental perspective — to create jobs and reduce the province’s dependence on fossil fuels.

2. Expect the NDP to also force the government’s hand on the nuclear file — specifically plans to build two new reactors at the Darlington Nuclear Generating Station. Can we afford it? Does it make sense? Would the money be better spent on deep energy conservation efforts and programs to help low-income Ontarians deal with the energy transition taking place in this province?

3. The NDP’s idea of putting all the power back in the hands of a re-constituted Ontario Hydro is flawed beyond belief, but certainly one can envision a new role for Ontario Power Generation. Why not let OPG develop renewables such as wind, particularly in the far north, in a way that still respects the need for independent power developers and the partly competitive market we currently have? It won’t be easy, but certainly the question should be asked. Letting OPG put some flesh in the game could also change the dialogue with the Power Workers’ Union, which has bashed the McGuinty green energy plan partly — if not mostly — because it threatens the jobs of its unionized workers at coal and nuclear plants.

4. I would hope the Liberals, backed by the NDP, also put pressure on Hydro One, which many believe has purposely dragged its feet when it comes to upgrading transmission and distribution to accommodate green energy projects, in hopes the PCs would win the election last night. Sorry folks — your wish didn’t come true. Time to deliver on what your shareholder has asked you to do. And if Hydro One can’t do it, perhaps the government should consider the idea of permitting merchant lines in Ontario, allowing private-sector transmission developers to enter the game to fill a vacuum left behind by our public utility.

5. Finally, the NDP did seem to emphasize a need to listen to the concerns of municipalities more closely. The Liberals were too dismissive of local concerns when the GEA and FIT were launched, declaring they would have no tolerance for NIMBYism. Well, obviously that wasn’t an issue when it came to natural gas power plant protests, so the Libs have exposed themselves as hypocritical on this file. Some of those protesting wind farms in rural Ontario are extreme, and they will never be pleased. But many have more legitimate and addressable concerns that need to be heard and, when possible and reasonable, acted on. The government needs to show more goodwill in this area, otherwise it will never get the rural buy-in that it desperately needs for Ontario’s green-energy future to remain bright.

Anyway, these are just some of my initial thoughts. Please consider this an open thread. I’m interested in hearing other views out there.

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Tyler Hamilton

There is a certain curmudgeonly segment of the population that seems to despise new, attention-grabbing technologies, particularly those that hold the potential to make the world a better place.

Electric vehicles fit all three categories, and this is probably why they have been criticized so much over the past two years – or past two weeks, for that matter.

The following points are almost always emphasized, and confidently passed off as “unwelcome facts” in attempts to prove electric vehicles are just a passing fad:

They’re too expensive and always will be;

They don’t drive far enough on a single charge and this will always be a problem;

They’re not really green if the electricity you charge them with is dirty;

Electric cars have come and gone in the past, and this time is no different.

Let’s start with cost. They do come at a premium and will for the next few years. But how is “premium” defined?

The roughly $42,000 (before rebate) price tag for the Chevy Volt plug-in hybrid or $39,000 for the all-electric Nissan Leaf is high when you compare it to a Honda Civic or Mazda 3, but not for folks who opt to purchase an Acura TL.

Why would consumers purchase an Acura TL when they could get a Honda Civic instead? I’m not sure, but they do. Maybe it’s faster, or has extra features that appeal to certain individuals.

Similarly, electric vehicles such as the Chevy Volt or Nissan Leaf will appeal to those who want the latest technology, better performance, place a higher value on clean transportation, and are tired of being gouged at the gas pumps.

The words “premium” and “expensive” are subjective, so to generally dismiss electric vehicles as too rich is disingenuous, particularly coming from folks who opt for marble countertops, high-end furniture and luxury SUVs.

Now, regarding the range of electric vehicles, there’s no question that all-electric cars aren’t ideal if you want to drive across Canada or to the cottage. Not yet, at least. They currently take too long to re-charge and there aren’t enough charging stations in existence today to support such a journey.

But automakers haven’t marketed them that way, so it boggles my mind when I read reviews that criticize the poor range of these vehicles. All-electric vehicles such as the Nissan Leaf are being promoted for urban driving, and will likely appeal to families with two cars or more.

The vast majority of people travel less than 50 kilometres a day to and from work, and millions of Canadian households have two or more vehicles in the driveway. This means that for a significant per cent of Canadian drivers an electric vehicle, even with current range limitations, makes sense.

They should be tested and reviewed in this context.

It should also be recognized that not all electric cars are created equally. The Chevy Volt, and other models likely to follow, comes with a gas-powered generator as backup. Range is not an issue, something critics of electric vehicles conveniently overlook.

Meanwhile, energy-storage technologies are improving – ask the engineers at Magna e-Car—charging speeds are getting faster, and costs are coming down. The vehicles will become more affordable to more consumers, but it won’t happen overnight. Nobody said it would.

It’s true, however, that electric cars are only as green as the electricity that goes into them. But even in jurisdictions still heavily dependent on fossil fuels, studies suggest the high efficiency of electric motors makes plug-in vehicles the slightly cleaner option.

Fortunately, the majority of electricity in Ontario comes from zero- or low-carbon sources. Without question, an electric vehicle charged in this province is dramatically cleaner than any gas-powered vehicle, particularly if it’s charged at night, which will be the case most of the time.

Let me make this final point: This is not a passing fad, nor can it be compared to past attempts at introducing electric vehicles or hydrogen fuel cell cars.

There has never been a time in history where most of the world’s major automakers have introduced, or have committed to introducing, a commercial model of a plug-in electric vehicle.

Never have there been more companies in the world working to develop and drive down the cost of supporting technologies, such as battery storage, charging infrastructure and electric drive trains.

Maybe electric vehicles won’t ever come to dominate the roads, or maybe they will. In the short term, even if they capture a few per cent of global vehicle sales over this decade it would be a major achievement – and this is entirely possible.

But to declare electric vehicles stillborn on the first year of their commercial introduction, as some observers have recently said, amounts to a stunning display of ignorance.

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

The government release didn’t mention dollars, but reports earlier in the day suggested that the government would be contributing $48 million toward what will be a $432 million R&D investment. This comes after a number of earlier EV-focused announcements, including Toyota’s disclosure last month that it will build its RAV4 electric vehicle at its plant in Woodstock, Ontario, and the government’s announcement a week later that it is creating an $80 million fund to help spur development and deployment of EV charging infrastructure in the province. Oh, and there was also the $2 million investment in Dana Holding Corp. toward building battery cooling systems for hybrid and plug-in vehicles.

A lot has happened in less than a month. Things are starting to come together… cautiously optimistic.

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Tyler Hamilton

Here’s a question I get asked all the time: Can solar modules made in Ontario compete in a global marketplace?

Many have their doubts, and those doubts are grounded in reality. The solar photovoltaic modules coming off Ontario assembly lines today are probably not going to find many customers in Europe or the United States.

The key word being “today.”

But give it two or three years. That’s the answer I get from manufacturers that have set up shop in this province, lured by a generous renewable energy purchase program that pays top dollar for electricity produced from solar panels.

We can get our costs down, they say — just give us the breathing room to do it.

That was the whole point of the province’s feed-in tariff (FIT) program. It was designed to provide above-market incentives for the first few years, after which rates would fall, owing to declining technology costs and manufacturing efficiencies that come from volume production.

Knowing the party won’t last, many Ontario manufacturers would ostensibly work to drive down their costs to where they could sell product in the United States and Europe at a globally competitive price-point.

All of that, however, was based on some assumptions. First, most manufacturers assumed a certain demand. Second, they assumed the Ontario grid could accommodate that demand. And third, they expected the program would survive long enough to follow through on their business plans.

The demand part happened. Ontario’s FIT program has resulted in contract offers for more than 1,300 megawatts of solar, exceeding most market forecasts. For example, Spanish solar-module manufacturer Siliken established a plant in Windsor based on the expectation that there would be a need for 400 megawatts of solar panels annually in Ontario.

But things fall apart after that. The program has been in effect for nearly two years, and so far only 10 megawatts worth of large projects have been built and injecting electrons into the grid, according to the latest figures from the Ontario Power Authority.

This may be a bit confusing. The province boasts the largest solar PV facility in the world in Sarnia, rated at 80 megawatts. How could we have built only 10 megawatts?

It turns out most of the solar development in Ontario over the past two years is the result of an earlier initiative, one that didn’t have domestic content rules. In other words, no manufacturers had to lay roots in Ontario to tap into market demand. That’s why panels for the Sarnia project came from U.S.-based First Solar and were made in Michigan.

The newer FIT program does require some domestic content, which is why we now have 18 solar manufacturers in Ontario. To their frustration, they see big demand for their product but their customers can’t get approval to connect their projects to the grid. No connection means no purchase order.

Manufacturers, for good reason, blame Hydro One for dragging its feet. In the meantime, assembly lines have been shut down and employees have been laid off until projects start flowing. Not the kind of environment in which product costs can be reduced and efficiencies gained.

“We came here thinking we could use the local market to support us while we brought our factories up and wrung efficiencies out of systems, getting us closer to competing against our brothers and sisters in China,” says Milfred Hammerbacher, president of Canadian Solar Solutions, whose parent company operates primarily out of China.

“We thought it would be achievable. But we needed two years to get to that level, and right now we’re just not getting that cushion. In a start-up operation where you have two or three of your lines not being used, there’s no way you can come close to being competitive (globally).”

Canadian Solar is committed to getting through this rough patch, as is Siliken. Many, however, are thinking seriously about packing up their bags and moving back home to their corporate parents.

It doesn’t help that Ontario Progressive Conservative Leader Tim Hudak wants to cancel the program if elected, pulling the rug from under a promising industry that’s already off balance. Thousands of jobs are at risk, as well as an export sector that — despite the spears we keep throwing at it — still has the potential to thrive if we’d let it.

“We set up in Windsor with the intention to serve the northeast of the U.S.,” says Paco Caudet, Siliken’s general manager in Canada. He just sold his flat in Spain. “I plan to stay here.”

It’s a courageous attitude. Still, why do we make it so easy for them to come, then turn around and make it so difficult for them to stay?

Tyler Hamilton, author of Mad Like Tesla, writes weekly about green energy and clean technologies. Contact him at tyler@cleanbreak.ca

By TYLER HAMILTON

Ontario has its own modern-day Stonehenge.

Didn’t you know?

Walking through a field of wild grasses and flowers at the Kortright Centre in Woodbridge you can see it as you approach: an organized display of majestic, sun-worshipping structures.

Instead of mysteriously erected stones dating back to 3,000 BC, however, these structures are solar modules mounted on tall poles or laid out on racking systems. The Kortright Centre calls the area PVPV, which aims to become country’s premier facility for testing and showcasing made-in-Canada solar technologies.

“We call it Solarhenge,” says Paul Luukkonen, who as sustainable technologies co-ordinator at Kortright is leading the PVPV initiative.

The centre is located on 325 hectares of woodlands, a little northwest of where Highway 400 and Major McKenzie Dr. intersect. There, about 130,000 visitors a year can go on hikes, watch wildlife, taste maple syrup or participate in one of dozens of practical workshops focused on renewable energy.

Owned and operated by the Toronto and Region Conservation Authority, it also has the space to grow. When the province introduced its feed-in-tariff program to encourage the deployment of renewable technologies, including solar power, Luukkonen and his team saw an opportunity.

Before the program, there was only one company in Ontario making solar panels, a Woodbridge-based firm called SolGate. With new local content rules in place, more foreign manufacturers have started setting up assembly operations in the province. Luukkonen figures there are now about 18 brands of solar photovoltaic panels made in Ontario, and that number is expected to grow.

“Problem is, we’ve been seeing a lot of funny promises from companies about the return on investment from their panels and how much energy their systems provide,” says Luukkonen.

For example, research from Natural Resources Canada indicates a typical 1-kilowatt solar panel can produce 1,161 kilowatt-hours per year in southern Ontario, yet some manufacturers and developers are claiming their products can produce up to 1,500 kilowatt-hours – on par with Los Angeles and Mexico City.

“Out of concern for sustainability of the industry, we want to make sure these salespeople are giving consumers realistic expectations,” adds Luukkenon, explaining how the PVPV initiative came about.

The plan now is to launch a facility that will test Ontario-made panels side by side at the same angle of exposure to the sun. Using the latest data-collection equipment, PVPV technicians will measure panel performance under a variety of conditions, taking ambient temperature, wind, snow fall and light conditions into account.

“Everything that qualifies to be sold in Ontario under the feed-in-tariff program, we want to test it and make that information available in an unbiased way to the consumer,” says Luukkenon. “We’re trying to instil consumer confidence with this third-party verification.”

Data will be publicly posted at on a monthly basis.

The test facility won’t be formally launched until September, but the first of several large racking systems designed to carry the panels is already taking shape.

Eclipsall Energy, which has a 120,000-square foot manufacturing facility in Toronto, and Heliene, manufacturing out of an 18,000-square foot facility in Sault St. Marie, are among those expected to cough up the $12,000 annual fee to join the testing program.

“Obviously, the more we have the more value that brings to this project,” says Luukkenon. “Another purpose here is to provide a showcase for Ontario-made technology and manufacturing for the tens of thousands of people who pass through each year.”

Manufacturers would be wise to join, even at the risk of having their panels rank at the low end of the pack. Those who don’t join will be sending a signal to developers and consumers that they don’t want their equipment being closely inspected.

“It will sort out who’s confident in their product and who’s putting crap out there while trying to capitalize on the current situation,” says Luukkenon.

And nobody, when they’re dishing out tens of thousands of dollars, wants to purchase crap.

Tyler Hamilton, author of Mad Like Tesla, writes weekly about green energy and clean technologies. Contact him at tyler@cleanbreak.ca

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.

Now, this bodes well for air quality in Ontario, but keeping in mind that on average 55 per cent of air pollution comes into southern Ontario from the United States, we heard more good news earlier this month when the U.S. Environmental Protection Agency finalized its Cross-State Air Pollution Rule, which goes into effect in 2014. That, in combination with other EPA initiatives, is expected to reduce sulphur dioxide emissions by 73 per cent and nitrogen oxide emissions by 54 per cent compared to 2005 levels. The rule, according to the EPA, “requires 27 states to significantly improve air quality by reducing power plant emissions that cross state lines and contribute to ozone and fine particle pollution in other states.” As EPA administrator Lisa Jackson said, “No community should have to bear the burden of another community’s polluters, or be powerless to prevent air pollution that leads to asthma, heart attacks and other harmful illnesses.”

Now, this wasn’t designed to protect Canadian provinces from smog-causing pollutants — it is meant to protect high-polluting states from less-polluting states — but the fact that Ontario is surrounded on its southern border by some of America’s biggest coal-using power plants, we can expect to benefit tremendously from this rule — assuming it doesn’t get derailed by legal challenges and continuing GOP insanity. I’m surprised, in fact, this didn’t get more coverage by mainstream Canadian media.

Two, it would have been more justifiable to impose another moratorium if the government had let developers keep the sites they had fairly secured. Instead, the government took the sites away and told developers that when the moratorium was lifted they’d have to start from scratch. Not a way to make friends of industry or to make investors feel comfortable in Ontario. It simply made zero sense to go that far, unless of course it was politically motivated — a likely explanation that is no comfort to the developers who put millions of dollars on the line and lost it all.

So, clearly the panicky Liberals are prone to making stupid decisions when under pressure by an opposition party that knows how to press its hot buttons. Will this be repeated for solar? If it was, it would IMHO completely sink the Liberal party heading into this upcoming fall election — particularly if it targeted small solar PV projects covered under the microFIT program. For larger projects, there is technically a moratorium in place. It’s called transmission restrictions, and it means only so many projects can be built in this province until transmission capacity is expanded to accommodate more. There have already been more project contract offers than the transmission system can accommodate, so really the throttle is the pace of transmission updates and the government, through Hydro One, controls that throttle. Better to make this fact clear to voters than to declare a moratorium that does nothing else but prove the Liberal party is on the run from a progressive energy plan it should be proudly promoting, with chest out and head held high.

For the record, I asked the Ontario Power Authority about these solar PV moratorium rumours and the agency flatly denied that a moratorium was coming. “OPA is not planning a moratorium for the FIT/mFIT program,” said spokeswoman Kristin Jenkins in an e-mail. “Right now, we are going through a process to issue contracts for the new Bruce to Milton transmission line which Hydro One recently received approval for. The developers that are eligible are the ones in the Bruce and West of London transmission areas on the FIT priority ranking list.  These developers did not receive contracts in the past because there was not transmission capacity.”

I asked as well about the planned two-year review of FIT pricing. Jenkins said the process will start in 2011, but she could offer no specifics on when. ”We will carry out the required two-year program review in 2011, but a date has not yet been set to start that,” she said. The sooner the better. (note: I deleted a paragraph from the original version of this post which messed up the dates of the upcoming review, leading me to an unnecessary rant. My apologies for the mistake for those who read an early version).