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Canada

Canada

Bid to beat Canada moratorium

CANADA: Canada's Windstream Energy is trying to navigate its way around Ontario's moratorium on offshore wind development in the Great Lakes by offering its 300MW Wolfe Island Shoals project as a site to study the province's health and environmental concerns and arranging a deal to buy turbines for the project.

The C$1.5 billion (US$1.5 billion) project, located five to 16 kilometres off Kingston in Lake Ontario, was awarded a C$0.19/kWh feed-in tariff contract in April 2010. But it was put on hold less than a year later when Ontario's environment ministry abruptly called a halt to offshore development.

"The moratorium was put in place under the guise of the need for more research, and we think the best way to conduct that research is to study a real project," said WindStream spokesman Randi Rahamim.

The company has gathered a coalition of supporters around its plan, and in recent weeks has put further pressure on the province by announcing a series of supply agreements. Windstream has a binding deal with Siemens Energy Canada for up to 130 turbines, as well as contracts with seven local companies that will provide services ranging from foundation construction to the provision of specialised barges to transport and erect the turbines.

Early movers

It is hoping to convince the Ontario government there is "a huge untapped opportunity" in being an early mover in the North American offshore sector, said Rahamim. "Part of the beauty of this is not building one particular project. It's creating the expertise that could be exported across the continent. There is approximately 2.6GW of offshore wind generation proposed in the Great Lakes area alone," she said. "We believe that whoever builds it first gets the jobs, gets the economic investment."

Wolfe Island Shoals is well positioned to lead the offshore charge in the Great Lakes, said Matthew DaPrato, a senior analyst with IHS Emerging Energy Research, a Massachusetts-based consulting firm. Although states on the US side have expressed interest and done some early stage groundwork "they haven't got to the point of supportive development policies for offshore wind like we've seen in Ontario."

Low wholesale power prices are also making offshore wind a difficult sell in the US, DaPrato added.

So far, though, the Ontario government has not shown a willingness to pursue either offshore development generally or the Wolfe Island Shoal project specifically. "Ontario will not proceed with offshore wind until enough scientific evidence exists to ensure that any future projects are developed in a manner that is protective of both human health and the environment," said Lindsay Davidson, a spokeswoman for the province's environment ministry.

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