producing a variety of policies for easing wind power into mainstream
electricity supply, from government sponsored tenders to sale of wind output directly into the wholesale market. What the provinces have in common is their increasing willingness to set targets for wind energy, supported by
legislation and new rules and regulations for reaching them
Two Canadian wind projects have recently added nearly 100 MW to the country's installed capacity, a growth spurt that not only surpasses the record 85 MW constructed in all of 2003, but which also represents the first trickle of what promises to be a flood of new wind developments. Southern Alberta's 30 MW Magrath project completed commissioning in late August, while Vision Quest Windelectric's 68 MW Summerview project, located about 75 kilometres west of Magrath, was expected to be fully operational by the end of September. Together the projects bring Canada's wind power total to nearly 440 MW.
Calgary-based Suncor Energy and EHN Wind Power Canada Inc, a subsidiary of Spain's Corporación Energía Hidroeléctrica de Navarra (EHN), revealed their plan to build the C$48 million Magrath project in spring 2003. A year later, pipeline giant Enbridge Inc, also based in Calgary, picked up a one-third share of the project. GE Energy provided the turbines, the first use of its technology in Canada, and 20 of its 1.5 MW machines were installed across the western province's rolling prairie ranch lands this summer.
Uncharacteristic of the Canadian wind industry, the majority of Magrath's output is merchant power: it is being sold into Alberta's deregulated wholesale electricity spot market rather than through a power purchase contract. Enbridge's return on capital for the development is not entirely exposed to the vagaries of the spot market, however, as the company has decided to use the electricity generated by its share of the plant to power its company operations. Across the US and Canada, Enbridge operates the world's longest crude oil and liquids pipeline system. A third of Magrath's output is about 13% of the electricity requirements of the Alberta leg.
Suncor and EHN are interested in contract customers for the remainder of Magrath's power, explains Suncor's Tracy Stoddard. But as a leading producer in the Canadian petroleum industry, Suncor is "comfortable with assessing commodity risks," he adds. "That's why we were able to build a project without having a long term contract in place."
Stoddard says Suncor wants to sell Magrath's power within the context of a renewable generation portfolio, using long and short term contracts along with some merchant exposure. Suncor and Enbridge are already selling the output of their 11.2 MW SunBridge wind farm in southwest Saskatchewan to the provincially owned utility, and future projects from the Magrath trio are possible, he says. "Basically," Stoddard explains, "we're going to manage our off-take in that portfolio manner, and make sure all our contracts aren't coming due at the same time."
Vision Quest is also working at signing customers for the power from its southern Alberta wind assets, but managing director Jason Edworthy is not prepared to offer details about its plans for Summerview. "We have not disclosed any of the long term contracts for the power," he says. "Our target is always about 75% contracted over the whole fleet."
Announced last December, Summerview is Vision Quest's fifth operational wind site in Alberta, where the company now owns and operates 220 turbines with a combined capacity of 189.4 MW. The project has proven interesting to Canada's veteran wind company because it uses the larger Vestas V80 1.8 MW machines. The appearance of the project is appealing, he says, because the site is "not as crowded looking" as projects that utilise the smaller Vestas 660 kW model, like the 75 MW McBride Lake Wind Farm that Vision Quest built last year in partnership with Calgary's Enmax Corporation. "The turbines are widely spaced," says Edworthy. "It has nearly the same capacity as McBride, but will likely put out more energy because of the increased efficiency of a larger machine, and only has 68 turbines compared to 114."
Vision Quest has a permit to install 122 MW of capacity on the 5000 acre Summerview site, although the wait for reinforcement of the area's electricity transmission lines will likely delay any expansion for two years, says Edworthy. The Alberta Electric System Operator has proposed nearly C$80 million in grid enhancements to serve the region's growing wind industry.
Action in Quebec
Meanwhile, construction of the 54 MW Miller Mountain wind project near Murdochville, Quebec, is back on track after a group of local companies blocked access to the site and equipment for more than a week. Vestas Canadian Wind Technology, contracted to install the project using its 1.8 MW machines, got a court injunction against the protesters, who were upset about the turbine manufacturer hiring subcontractors from outside the region. "In fact, all the protesting companies had the opportunity to bid on this project and were even invited to re-submit their offers when they came in significantly over budget," says Tom Carbone, president of Vestas Americas.
Vestas has since agreed to hire the companies to work on the expansion of the neighbouring Mount Copper wind farm, which should to be completed by March. Vestas installed the first five 1.8 MW turbines in the 54 MW project, owned by Montreal's 3Ci, in May and last month confirmed an order for 25 more. The companies will also be used as needed at Miller Mountain, also slated for completion by March.
The desire to see local benefit from the exploitation of the wind resource is strong on the Gaspé Peninsula, where Murdochville is located, and has been since the late 1990s when the 100 MW Le Nordais project was built. At the time, there was a great deal of frustration among residents that after the area finally landed a large scale wind project, much of its economic value flowed elsewhere.
The Murdochville projects are just the start of Quebec's attempts to make wind power a driver of economic development in the province. Hydro-Quebec is expected to announce the winning bids this fall in its call for 1000 MW of wind energy and to follow that up with a second 1000 MW request for proposals. Next door, Ontario is in the process of selecting the first projects in its plan to have 5% of all generating capacity, about 1350 MW, to come from renewables by 2007 and 10% by 2010. In Nova Scotia, the second phase of Atlantic Wind Power Corporation's 30 MW Pubnico Point project, which adds 15 Vestas V80 1.8 MW turbines to the two installed earlier this year, is expected to be complete by the end of the year. In fact, the Canadian Wind Energy Association says that wind-related policies under development in all the provinces could increase Canada's wind energy production almost ten-fold in the next six years. to more than 4000 MW. Only three countries currently have more than that: Germany, Spain and the United States.