Welcome to Blue Green Canada's Green Economy Review.
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In this issue:
- The FIT helps…
- Green Manufacturing Starts
- China vs the USA
- Green International Developments
- Opportunities in Offshore Wind
- Retrofits Receive Contrasting Treatment
- Financing the Transformation
1.The FIT helps…
In addition to creating jobs and fueling economic growth, the Green Energy Act is helping to finance a variety of local initiatives and serving as an additional revenue stream for cash-strapped municipalities and their community members.
Publicly owned electricity distribution utilities in both Brant County and the City of Guelph are taking advantage of the FIT and installing solar panels on some of their buildings. These solar installations will serve as a source of revenue for the utilities, but they are also part of a larger commitment to renewable energy in both these communities. Brant County has joined with 4 other municipalities to form a green energy hub which aims to bring green energy jobs to the area. And the City of Guelph has already been successful at attracting green energy jobs; in November, Canadian Solar announced they would be opening a solar module manufacturing facility, employing some 500 people, and Melitron announced their intention to build solar inverters, adding another 80 jobs to the clean energy tally.
Utilities are not the only public entities looking to green energy as a source of revenue. Parry Sound is one of many municipalities investigating installing solar panels on publicly-owned buildings. And a number of public schools, including 10 TDSB schools, are also planning solar installations.
Of course, private citizens are also getting into the green energy game. This month, it was reported that an entrepreneur in Windsor will be using green energy to finance a new film studio, and a church in London Ontario connected a cross-shaped solar array to Ontario’s electricity grid.
2. Green Manufacturing Starts
Ontario continues to attract renewable energy manufacturers thanks to the domestic content requirements in the Green Energy Act.
In the final month of 2010:
- It was announced that Newmarket-based electronic manufacturers, Flextronics, would begin manufacturing solar modules for SunEdison, bringing 100 green jobs to the region.
- German solar module manufacturer, Sovello, announced that they had signed a contract to provide 41.5 MW of PV modules for the Ontario market. The modules will be manufactured by Sovello in Ontario under OEM contracts.
- Eclipsall Energy Corp. announced plans to invest more than $10 million to build a new 64 megawatt solar panel production facility in the greater Toronto area. The facility will provide direct employment to more than 90 people, according to Eclipsall. And,
- Heliene Inc, who began manufacturing solar modules in Sault Ste. Marie a few months back, announced that they were adding another shift, and moving to 24/7 production to meet demand for their product.
Outside of Ontario, VBINE Energy announced plans to open a wind turbine manufacturing plant in Winkler, Manitoba, creating 100 or more jobs; Abound Solar announced plans to build the largest thin film solar plant in the U.S., in Indiana. The facility is expected to employ 1000 people; and Michigan is expected to be home to a large wind turbine assembly plant, which will assemble the first turbines built in the U.S. with American-made parts.
Unrelated to renewable energy, Energy Innovation Corp. (EIC), Canada's leading biodiesel innovator, announced plans to open the City of Toronto's first biodiesel manufacturing facility in the port lands.
3. China vs the USA
Despite reports that California now has 5000 clean energy and sustainable workplaces and the number of green jobs in Hawaii is projected to increase by 26 percent by 2012, most analysts agree that China is pulling away from the U.S. in the clean energy race.
Ernst and Young’s most recent Renewable energy attractiveness indices again put China at the top, with the authors concluding that "A new world is emerging in the clean energy sector with China now the clear leader in the global renewables market."
One analyst estimates that China is now spending $12 million each minute on some aspect of renewable energy. While opinions vary as to why China is investing so heavily in renewables, some analysts think it can be chalked up to self interest. As we reported a few months back, pollution is already acting as a significant drag on Chinese GDP, perhaps prompting the Chinese government to recognize that they must grow their economy in a less polluting manner.
As China firms up it’s lead, U.S. Secretary of Energy Steven Chu compared the clean energy race to the race to space, saying the U.S. faces a “Sputnik moment.” "America still has the opportunity to lead in a world that will need a new industrial revolution to give us the energy we want inexpensively but also carbon-free. It's a way to secure our future prosperity," Chu said at a press event at the National Press Club in Washington, D.C. on November 29. But "I think time is running out."
4. Green International Developments
China and the U.S. are, obviously, not alone in their embrace of renewable energy. In their November installment, Ernst and Young added four more countries, South Korea, Romania, Egypt and Mexico, to their Renewable Energy Attractiveness Indices. E&Y now track monthly developments in over 30 countries.
India, tied with Germany for 3rd in E&Y’s All Renwables Index, is investing heavily in renewable energy deployment. The Pew Charitable Trusts reports that India’s investments in renewable energy may rise to $169 billion over the next decade, which would put India on track to climb from 10th place to third among the G-20 grouping in terms of clean power project investments worldwide.
Taiwan’s green economy is also growing quickly. In the first 11 months of 2010, the industry revenues were reported to be $10.97 billion (U.S.), an increase of over 50% from 2009. Taiwan also reports that nearly 30,000 green energy jobs were created in 2010.
5. Opportunities in Offshore Wind
Offshore wind, still in its infancy in North America, continues to be an area of great potential. Last month, the Conference Board of Canada published a report which estimated that 2,000 megawatts of offshore wind power could come online between now and 2026, creating over 55,000 person years of employment and adding up to $6 billion dollars to GDP over the same period.
Energy reporter and Toronto Star columnist, Tyler Hamilton, is fond of the idea. “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,” he writes. “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.”
Offshore wind projects are also expected to get underway of the eastern coast of the U.S. Renewable energy developer, Deepwater Wind LCC, announced plans to build a 200-turbine, 1,000-megawatt project off the coast of Rhode Island, reportedly the largest offshore development in the U.S. According to Deepwater, the turbines will be located far offshore, barley visible from land.
The massive wind farm is also going to have some added impacts. It may enable lower-priced electricity from the north to flow into New York, since it would be connected to the grids of both New England and New York.
6. Retrofits Receive Contrasting Treatment
Retrofits, widely agreed to be the most cost-effective way to reduce CO2 emissions and create green jobs, are receiving contrasting treatments in Canada and the U.S.
In Canada, the Federal Eco-Energy Retrofit program, cancelled last March, will be formally brought to a close this March. And Ontario’s provincial program is also slated to come to an end on April 1. These programs have helped well over a hundred of thousand Canadians install energy efficient furnaces, better insulation, and other measures. However, as these programs are brought to a close, there aren’t any plans, at either the federal or provincial level, to put anything in their place.
The story in some U.S. states seems to be quite the opposite. New Jersey has ramped up a program to help low-income residents make their homes more energy efficient. The program has been around for a number of years, but in 2009 the U.S. federal government strengthened their commitment and upped funding to $119 million over three years as part of President Barack Obama's economic stimulus plan. The program is heralded both for it’s potential to create green jobs and help low-income families save money on their energy bills.
New York State is also boosting their program by making nearly $60 million available to fund loans to help homeowners afford energy audits and energy efficiency retrofits to stop their houses from leaking heat. The loans will be paid back from savings on utility bills resulting from the energy efficiency upgrades.
7. Financing the Transformation
Over the past month, private investors have given renewable energy a vote of confidence by investing impressive sums in renewable energy projects.
In the largest private bond ever issued in the UK, Ecotricity, a British renewable energy company, has successfully raised over £10 million. According to Ecotricity founder Dale Vince, the popularity of the EcoBonds, which were oversubscribed by 50%, indicated the public appetite for investing in Britain’s green energy future. The money raised through the bonds will be used to build wind and solar farms across the UK.
Here in Canada, renewable energy developer, BluEarth Renewables, has managed to amass C$160 million, recently buoyed by a C$75 million investment from the Ontario Teachers' Pension Plan. BluEarth is looking for renewable energy projects in need of investment in both Canada and the U.S.
Of course, public investment remains important. Members of the finance industry, the UNEP Finance initiative and WWF reminded climate negotiators in Cancun that considerable public investment is still needed in order to reverse the trend of rising greenhouse gas emissions. Public money, they say, must be used to further develop the funding mechanism under the UNFCCC in order to leverage more private capital to help mitigate climate change.