Wind power profits don’t stay in Ontario

April 15, 2018

Follow the money … out of Ontario

A profile of who’s who in Ontario wind power development

Tax benefits and subsidies were important incentives to foreign companies

By Wind Concerns Ontario

 

The rainbow didn’t end in Ontario after all

 

April 15, 2018

With the recent announcement that the Canada Pension Plan decided to purchase some of U.S. energy giant NextEra’s wind and solar portfolio (a $741M CAD deal that also involves assuming $800M in debt), many people are suddenly noticing ownership of Canada’s renewable power sector.

A popular view of the wind industry in Ontario is that it is composed predominantly of Canadian companies in an “infant industry” that needs government subsidies to survive. The reality only becomes clear when one looks behind the scenes at the actual participants in the industry.

Ontario’s industrial wind generators enjoy the benefits of many federal and provincial programs, all of which were intended to ease their access to financing and improve investors’ returns. The list of special incentives is a long one, but here are the five most important:

 

  • The implementation of special feed-in-tariff (FIT) rates far above the market rates received by conventional energy producers; these rates started at $135 per megawatt hour (MWh) and have only recently declined to $125 per MWh;
  • The guarantee of these rates for the twenty-year life of the contracts;
  • Granting wind and other renewable energy sources priority access, or “first-to-the-grid” rights, requiring the Independent Electricity System Operator to take their production whenever it was available, even when that meant curtailing the purchase of other generation or dumping surplus energy at distressed prices on export markets;
  • Special tax benefits, including the federal government’s accelerated capital cost allowances and the Canadian Renewable and Conservation Expenses allowance and the Ontario government’s cap on the property taxes that industrial wind turbines pay to local municipalities;
  • Other subsidies, including the federal government ECOenergy for Renewable Power Program, $1.4 billion over five years in Budget 2017, and continuing large research and development assistance.

 

As a result, the Ontario wind industry, in general, has found the “pot of gold”, a level of income and wealth that far exceeds its general image. To illustrate this, let us examine some of the most prominent firms in the industry.

Here is a summary of the companies active in Ontario both as developers and operators, with financial statistics gleaned to the best of our knowledge and ability.

 

Non-Canadian developers/operators

Acciona: With headquarters in Madrid, Spain, Acciona develops and builds power projects for itself and third-party companies in 20 countries worldwide. In Ontario Acciona operates the 76-MW Ripley wind power project. As part of its “wind power value chain” the company also manufactures some turbine components. Revenue in 2017 was €7.2B and net income was €220M or $350M CAD. Chairman is José Manuel Entrecanales; no compensation data is available.

Brookfield Renewable Energy Partners: Headquartered in Bermuda with an office in Toronto, Brookfield is “multi-technology, globally diversified, owner and operator of renewable power assets” which includes more than 70 wind power projects around the world. In Ontario the company operates the 189-MW Prince project, Comber (165 MW) and Gosfield (50.6 MW) Brookfield also owns 51% of US-based Terraform Power, which operates the Raleigh Wind Farm. North American revenue in 2017 was $1B USD. CEO is Sachin Shah; 2016 compensation was $3.8M USD. 

Capstone Infrastructure: Capstone Infrastructure is a subsidiary of U.K.-based Irving Infrastructure, and owns and operates thermal and renewable power facilities. Headquarters for Canada are in Toronto. In Ontario, projects are: Erie Shores-Port Burwell-Malahide (99 MW), Skyway 8 (9.5 MW), Goulais (12.8 MW), Grey Highlands (18.5 MW), Grey Highlands ZEP (10 MW), Ganaraska (8.8 MW), Snowy Ridge (5 MW) and Settlers Landing (4 MW). Revenues for 2017 were $154M CAD. CEO is David A. Ave, whose 2016 compensation was $500K CAD.

EDF Renewables: This company is associated with EDF or Electricité du France, the Power utility in France. Headquarters for EDF Renewables is in San Diego, California; the company operates in Canada as EDF EN Canada (EDF Energie Nouvelles). EDF EN Canada currently has a contract for the 60-MW Romney Wind power project, which was the first of the LRP I projects to receive Renewable Energy Approval on April 16, 2018. CEO is Tristan Grimbert. No further financial data is available.

EDP Renewables : EDPR is a division of EDP or Energias du Portugal. The company’s headquarters are in Oviedo, Spain. EDPR claims to be the world’s fourth largest wind power developer. In 2017, the company states, it produced 27,600 GWh of power from wind. In Ontario, it operates the 30-MW South Branch project between Ottawa and Cornwall, and currently has a contract for the 100-MW Nation Rise project in North Stormont, south of Ottawa. Revenues in 2017 worldwide were €1.6B or $2.5B CAD. CEO of EDPR is Joᾶo Manso Neta; there is no compensation data available for the CEO. In June 2017 it was announced that the CEO of parent company EDP was being investigated on corruption charges related to power contracts; the CEO of EDPR was also being investigated, but there has been no news since of any charges.

Engie: Based in France, with North American Headquarters in Houston, Texas, and an Ontario office in Markham. This company bought AIM Power Gen (operated by Mike Crawley who is known to many Ontarians, and is now VP at Northland) which had become GDF Suez; it now operates the wind power projects at Cultus-Clear Creek Frogmore (30-MW), Harrow (40 MW), Erieau (99 MW), East St. Clair (99MW), Plateau (27 MW), and Point Aux Roches (49 MW). Revenues company-wide for 2017 were €65B or $101B CAD. CEO is Isabelle Kocher, whose 2016 compensation was €2.8M or $4.4M CAD.

Horizon Wind: See EDPR. The Horizon “Legacy” company operates the 10-MW Ernestown Wind project near Kingston.

Invenergy: This U.S.-based company has its headquarters in Chicago, and offices in Toronto, Denver and Mexico City plus a European office in Warsaw. It currently manages or has developed 82 wind power projects. Net worth is approximately $1B USD. Current Ontario project: Strong Breezes Dutton Dunwich (57.5 MW). Invenergy also developed the 78-MW Raleigh Wind project, which it sold to TerraForm and Sun Edison. Invenergy had proposed a project in North Perth, but the contract with IESO was terminated when it became impossible for the company to meet the contracted amount of power generation, due in part to citizen action and community opposition.

Longyuan Canada Renewables/China Longyuan Power Group: With 10,000 wind turbines worldwide in its portfolio producing 17,000 MW of power, the China Longyuan Group is the world’s largest wind power developer. The company also produces power from coal, and has minor interests in thermal, biomass and solar. Wholly owned subsidiary Longyuan Canada Renewables is headquartered in Toronto with nine employees, and operates the 91.4-MW Dufferin Wind power project (Melancthon). President is Zhu Dong; no compensation data is available. The company recently applied for an amendment to its renewable energy approval, to install optimization software which will increase power output but not exceed its nameplate capacity of 99MW. Operating profits for China Longyuan in 2017 were CNY 8.3B ($1.7B CAD), up from 2016 due to higher prices for coal. The President/General Manager is Li Enyi whose 2016 compensation is reported by Bloomberg as CNY 1,074,00 ($219,000 CAD)

NextEra Energy: NextEra Energy Canada is a division of NextEra Energy Inc. The company’s headquarters are in Juno Beach, Florida FL with a Canadian office on Bay Street in Toronto. NextEra operates the following Ontario wind power projects under contract to the provincial government: Conestogo (22.9 MW), Jericho (149 MW), Adelaide (60 MW), Bluewater (60 MW), Summerhaven (124.4 MW), Goshen (102 MW), Cedar Point II (100 MW), Bornish (73.5MW), and East Durham (22 MW). Income of the parent company was $5.3B USD; president and CEO James Robo earned a base salary in 2016 of $1.3 M USD but topped it up with incentives, bonuses and stock options for a total compensation package of $16M USD. On April 2, 2018, it was announced that the Canada Pension Plan had agreed to purchase four NextEra wind facilities, plus two solar projects, in Ontario; the deal is subject to Canadian regulatory approval and if approved, may close in the second quarter of 2018.

RES Group, operating in Canada as RES Canada: Headquarters are in the UK with a Canadian office in Montreal. RES’ slogan is “Power for Good.” The company boasts a portfolio of more than 7,000 wind turbines and asset management of 2 GW of wind power generating facilities. RES Group was the subject of a BBC documentary called “Blown Apart” which featured an RES employee “Rachel” who infiltrated a village community with dreams of a green future for her community, only to be revealed eventually as a corporate operative trying to get people to sign wind turbine leases. In Ontario, RES was involved in construction of South Kent Wind, Brooke-Alvinston, Grand Valley 3, and Gunn’s Hill, and as a developer, has a contract for the 32-MW Eastern Fields in The Nation, near Ottawa. RES bills itself as a full-service provider, offering asset management and project design services. No data found on earnings, and no information on compensation for CEO Ivor Catta.

Pattern/Pattern Energy Group: The company’s slogan is “Transitioning the world to Renewable Energy.” Headquarters are in San Francisco; the company operates the Belle River (see Samsung), and North Kent projects in Ontario, is a partner in K2 Wind, and is constructing the Henvey Inlet 300-megawatt project. 2017 revenues were $411.3 million USD. CEO/President is Michael Garland, whose 2016 compensation was $2.7 MM ($430.7K salary, $456K bonuses, and $1.8MM stock).

Prowind: Prowind is a very small player but managed to attract attention for its 18-MW Gunn’s Hill project near Woodstock, which it claims is a totally community endeavour. In fact, the lone community member in the investment leadership group went on to be president of Prowind Canada, and other “community” members were Toronto-based environmental organizations. The community launched an appeal of the REA, but was not successful. Prowind is a subsidiary of Prowind GmBH of Germany; president and CEO in North America is Frank Mascia and chair is Johannes Busmann. No financial data is available.

Samsung Renewable Energy: The company is a division of Samsung C&T Investment Trading Group. Samsung C&T is headquartered in Korea; there is an office in Canada located in Mississauga. Samsung developed the huge K2 Wind project (with Pattern and Capital Power, 270 MW) but has since sold its interest to a consortium which includes insurance giant ManuLife, the Alberta Teachers’ Retirement Fund and Toronto-based equity fund manager Axium. Samsung operates Belle River (100 MW) , Armow (180 MW), and South and North Kent (270 and 100 MW respectively). Samsung, also known as “the Korean consortium,” was given an extraordinary contract by the Ontario government in 2010 to buy $9.7B CAD worth of electricity. The contract amount was slashed by a third in 2013; the government claimed Samsung had missed some deadlines, but the fact is, that much power was not (is not) needed. Canadian vice-president is Steve Cho; Samsung C&T president and CEO is Chi H. Choi; no compensation data is available. Samsung C&T operating profits in 2017 were 881.3B won or $1.05B CAD.

Saturn Power: Saturn operates the 10-megawatt Gesner project. It is a private company so no financials are available; headquarters are in Baden, Germany.

Terraform Power: Headquartered in Bethesda, MD, Terraform is the “owner and operator of a 2,600 MW diversified portfolio of high-quality solar and wind assets, primarily in the U.S., underpinned by long-term contracts” which includes the 78-MW Raleigh Wind project, which it purchased from Invenergy. Revenue for 2017 according to the company pro forma was estimated to be $585 M USD. CEO is John Stinebaugh; no compensation data available.

Veresen Inc.: Veresen was the owner and operator of the 20-MW Grand Valley 1 wind power project; the company was recently acquired by Pembina in 2017 for $6.4B CAD.

WPD Canada: This is a wholly owned subsidiary of WPD Europe/WPD AG, a private company headquartered in Bremen, Germany. The Canadian office is in Mississauga. The company is active in 18 countries and says it has installed 1,700 wind turbines. In Ontario, WPD operates the Springwood (8.2 MW), Whittington (6 MW), Napier (4 MW) and Sumac Ridge (10.25 MW) projects, and has a contract (currently being disputed in the courts by a citizens’ group) for the 18-MW White Pines project in Prince Edward County. WPD Power’s CEO is Dr. Gernot Blanke; no compensation data is available

 

Canadian companies

Algonquin Power & Utilities Corp.: Algonquin is described as a Canadian utility involved in the generation, transmission and distribution of power. The headquarters are in Oakville, Ontario. At present in Ontario, the company’s wholly owned subsidiary Windlectric Inc. sold half its lone wind project to Newfoundland-based construction company Pennecon to build a 75-MW wind power project on Amherst Island. Algonquin Power is estimated to have $10B CAD in assets. With a five-year return of 73% the company has been the darling of Canadian investors but has tumbled with a more recent 1-year return of 2.06%. CEO of Algonquin is Ian Robertson, whose 2016 compensation was $3.5M according to Reuters; Pennecon’s president is David Mitchell for whom no compensation data is available.

BluEarth Renewables: With headquarters in Calgary, Alberta, BluEarth is described as a “private independent” company whose major shareholder is in fact the Ontario Teachers Pension Plan. It operates two wind power projects in Ontario: Bow Lake Wind (60-MW), and St Columban (33 MW). In February 2018, BluEarth announced a deal with Veresen in which it would acquire an interest in three Ontario wind power projects, with a view to own and operate, in the long term.   Net worth is estimated at $10B CAD. President and CEO is Grant Arnold; no compensation data is available.

Boralex: Boralex was created in 1990 as a joint venture between the leaders of three companies; the name Boralex is derived from the names of these companies: LaduBOR, ALbany Oil (U.S.) and EXar (U.S.).  Headquarters are in Kingsey Falls, QC. Boralex is active in Canada, France and the U.S. Ontario Projects are Port Ryerse (10 MW) and the proposed/contracted Otter Creek (50 MW). The company was involved in the development of the Niagara Region Wind Farm (230 MW) and acquired at least part of the project from Enercon in 2017. Revenue from energy sales in 2017 to September 30 were $285M CAD. Total equity: $2.7B USD. Compensation for CEO Patrick Lemaire was $1.2M CAD in 2016.

Capital Power: Based in Edmonton, Capital is involved in a variety of power generating enterprises, including wind; Capital is a partner in K2 Wind, and operates the 40-MW Kingsbridge project in Ontario, and the 104-MW Port Dover and Nanticoke facility. Revenues in 2017 were $1B and net income was $144M. CEO is Brian Vaasjo whose 2016 compensation was $2.9M.

Enbridge: The company is best known as a producer of fossil fuels in Canada. Headquartered in Calgary, Alberta the company says it transports, generates and distributes energy, in that order. It operates 16 wind power projects in North America, including the Talbot (98.9 MW) and Underwood (181.5 MW) power facilities in Ontario. Adjusted earnings for 2017 were $3.2B CAD of which “green power” earnings were $101MM. CEO until recently was Al Monaco who is listed as one of Canada’s 100 highest paid executives with a base salary of $1.377MM and total compensation of $11.391MM.

Kruger Energy: Kruger is a family-owned company headquartered in Montreal that is involved in paper, paperboard recycling, and energy. Kruger Energy was founded in 2004 to develop power projects in Canada, and currently operates the 101.2-megawatt facility at Port Alma, and the 99.4-MW Kruger Chatham Wind Farm in Ontario. The company also put forward a proposal in 2015 for another Chatham-Kent facility. The company is privately held by the Kruger family. CEO is Jean Roy; no compensation data is available.

Northland: Northland is a rare bird in wind power development in Ontario, with headquarters in Toronto. The company operates two wind power projects at present: McLean’s Mountain on Manitoulin Island (60 MW), and the Grand Bend facility in Zurich (100 MW). Profits for 2017 were up 37% to $1.2B CAD, with net income up 45% to $276 MM. Northland is involved in two offshore wind projects in Europe and owns 100% of the Nordsee wind power project. Northland is also involved in solar projects in Ontario. CEO is John Brace whose 2016 compensations was $1.9MM CAD ($473K salary, $1MM stock, and $9,000 “other”). Also on Northland’s executive team is Mike Crawley, former CEO of AIM PowerGen and also famously chair of a McGuinty government panel that looked at a mix of energy resources for Ontario, and he was later president of the Ontario Liberal Party, and subsequently, the Liberal Party of Canada. Mr. Crawley’s 2016 compensation was $923K.

Suncor: The company describes itself as an “integrated energy company.” With headquarters in Calgary, Alberta, Suncor currently operates four wind power projects in Canada, one of which is the Adelaide power project. But the company used to own more: in 2015, however, Suncor announced it was divesting almost all its wind assets, particularly in Ontario, and so sold off Ripley and Cedar Point as well as its share in the Kent Breeze project. Funds from operations in 2017 were $3B CAD. CEO is Steven Williams who is also listed by Canadian Business as one of Canada’s 100 highest paid executives. His base salary in 2017 was $1.375M, and total compensation was $11.482M.

TransAlta: Based in Calgary, TransAlta owns and operates the wind power project on Wolfe Island (famous for being one of the wind power projects with the highest number of bird kills in North America) and phases 1 and 2 of the Melancthon project in Shelburne (199 MW). The company claims production of 2,300 megawatts of power, of which 54% is from wind, in 18 facilities around the world. Wolfe Island and Melancthon 2 receive payments not only from their power purchase agreements with Ontario but also federal ECOenergy payments. Revenues for 2017 were $2.3B with operating income of $138M. The President and CEO is Dawn Farrell whose compensation came under fire in 2017 at the shareholders’ meeting; they objected to the 60% rise in compensation. Ms Farrell was paid $7.4M, which included a base salary of $960,000 plus stock options and bonuses.

 

Ownership at a glance

Developer ownership Megawatts in operation/planned Ontario
Non-Canadian 4,130.95
Canadian 1,212

More than 75 percent of Ontario’s wind power projects are owned by non-Canadian companies

 

Wind power development suppliers:

Enercon Canada:  Enercon Canada is a subsidiary of Enercon GmbH of Germany, which is the fourth largest turbine manufacturer in the world. Its Canadian offices are in Montreal. Enercon Canada developed and had the majority interest in the 230-MW Niagara Region Wind Farm until selling at least a 25% stake to Boralex in 2017. CEO is John D. Richardson; no compensation data is available.

Senvion Canada: Senvion Canada is a division of Germany-based Senvion S.A., one of the world’s leading turbine manufacturers. The company began operating in Canada in 2009 and now has more than 660 turbines installed. Senvion Canada is headquartered in Montreal, Quebec, with offices in Toronto, Ontario and Vancouver, British Columbia. Senvion’s 2017 revenue was €1.8M ($2.8 CAD), sales or “order book” were €5B ($8B CAD). Senvion is owned by Centerbridge Partners, a New York-based private equity firm. CEO is Jurgen Geissinger; no compensation data is available.

GE Renewable Power is a division of GE or General Electric, which is aiming to profit from the renewables sector by manufacturing equipment including turbines. GE headquarters are is Boston, Massachusetts. In Canada, GE manufactures wind turbine blades at a plant in Gaspé. Profits have been down lately for the company, with a 1-year return on investment of -54%. In 2017, operating cash flow was $10B USD. CEO of GE Renewables is Jérôme Pécresse; no compensation data is available.

Vestas Wind Systems: Based in Aarhus, Denmark, publicly owned Vestas is perhaps the best known among wind turbine suppliers. According to one 2015 industry article, Vestas is the number one company in the world for turbine installations. Annual revenues for 2017 were €9.9B or $15.5B CAD, and operating profit was €1.6B or $2.5B CAD. CEO is Anders Runevad, who came on board in 2013 to help shift the company back to good fortune. Mr. Runevad maintains a low public profile and there is no compensation data available.

Siemens Canada is a division of worldwide engineering firm, Siemens AG, headquartered in Munich, Germany. Siemens Canada claims expertise in the fields of electrification, automation and digitalization and is involved in sustainable energy, “intelligent infrastructure,” healthcare and manufacturing. One of the world’s largest producers of energy-efficient, resource-saving technologies, Siemens is a foremost supplier of power generation and power transmission solutions. The company is also a leading provider of medical imaging equipment and laboratory diagnostics as well as clinical IT. With Headquarters in Canada in Oakville, Siemens Canada has approximately 5,000 employees, 44 offices and 15 production facilities from coast-to-coast. Siemens AG assets as of 2017 were €134B or $214.6B CAD; revenue was €83B ($9.61B CAD); operating cash flow was €6B ($132B CAD). Siemens Canada President and CEO is Faisil Kazi; no compensation data is available.

Aecon: This Canadian construction company is engaged in infrastructure and energy projects throughout Canada. The company is currently in negotiations to be sold to Chinese company CCCC International, but the sale is under review by the federal government on the grounds of national security interests. Aecon has headquarters for various regions but the Canada East office is in Toronto. Financial results were presented under Infrastructure and Energy—we’re not sure where the company’s work for wind power developers fits. Results for 2017 are: Infrastructure revenues $685M CAD and operating profit was $32.5 M CAD; Energy revenues were $395.7 M, and operating profits were $23.1M. Total assets for Aecon were $2.5B. President and CEO is John M. Beck whose 2016 compensation was $3.6M.

 

 ***

 

WIND CONCERNS ONTARIO

contact@windconcernsontario.ca

 

The information is complied from publicly available information. It is not an exhaustive list of Ontario wind power projects but we have elected to include developers of power projects 10-megawatts and more. Sources: company financial reports, Bloomberg, Reuters, Canadian Business

Thanks to energy economist Robert Lyman and energy commentator Parker Gallant for their input.

WCO expresses concern over CPP purchase of Ontario wind farms

Are wind farms the problem-free “green” investment the CPP should buy for Canadians’ future?

Why buy wind power projects when Ontario has a surplus of power and when wind power is a factor in higher electricity bills leading to energy poverty, Wind Concerns Ontario asked in a letter. And why is Canada’s public pension fund investing in projects that are producing environmental noise?

 

April 4, 2018

Wind Concerns Ontario, the coalition of more than 30 community groups and hundreds of families and individuals concerned about the impacts of industrial-scale wind power development, has written a letter to the Canada Pension Plan Investment Board, expressing concern about an announcement to buy four Ontario wind power projects from US-based NextEra Energy.

The CPPIB announced it was buying for wind power projects and two solar facilities in Ontario for $741M CAD, and further assuming NextEra’s debt of over $800M.

In a letter to President and CEO of the CPPIB Mark Machin, sent to the Board’s office in Toronto, Wind Concerns noted that Ontario is in a situation of surplus power, which is costing Ontario citizens millions.

“The surplus power is either sold at below-cost rates or given away to neighbouring jurisdictions,” WCO said,  “a practice that has caused Ontario’s electricity costs to balloon and is contributing to the energy poverty situation now being faced by many of the pensioners that your plan supports.”

There is also the troubling fact that the four NextEra wind power projects (Summerhaven, Jericho, Bluewater and Conestogo) have been the source of more than 120 official reports of excessive noise and vibration, some including staff notes on health impacts, made to the Ministry of the Environment and Climate Change. WCO obtained the Master Incident files under the Freedom of Information request process.

Citing one Master report from the Conestogo project in which MOECC staff noted that the mandated emissions and imissions audit were “incomplete at the time of submission” and also, that the Ministry had not provided resources for Provincial Officers to visit sites after hours and confirm or deny compliance, staff had no choice but to close the Incident Report file.

” Th[at] excerpt is typical of how noise reports are managed: there is no resolution, and the project is not compliant with key terms of its approval,” Wind Concerns Ontario told Mr. Machin.

WCO also referred to the Investment Board’s stated commitment to “Environmental, Social and Governance (ESG) factors” in investment choices, and said, “We would think you would share local residents’ concerns about the operation of these projects. In short, there are other factors in this investment decision beyond the financial.”

“A critical factor will be resolution of these [noise] reports,” Wind Concerns’ president Jane Wilson concluded in the letter, “management and resolution of citizen health impacts, and liability for property value loss and other negative effects.”

 

Contact@windconcernsontario.ca

 

 

Canada Pension Plan buys wind power projects

U.S.-based NextEra reaps cash for valuable “guaranteed price” Ontario wind contracts as the CPP pays millions and even assumes almost $1B in debt

April 3, 2018

Florida-based NextEra Energy has sold off a significant portion of its Ontario renewable power portfolio to the Canada Pension Plan in a deal that nets the company over $700 million CAD in cash, and also sees the Canadian public pension plan assume debt of almost $900 million.

Here is a report from wind industry publication, Windpower Engineering and Development. The Canadian Pension Plan also released the information here.

NextEra selling Ontario wind & solar assets

NextEra Energy Partners, LP announced that it has entered into a definitive agreement with Canada Pension Plan Investment Board (CPPIB) for the sale of its portfolio of wind and solar generation assets in Ontario, Canada, for a total consideration of about $582.3 million. This includes the net present value of the O&M origination fee, subject to customary working capital and other adjustments, plus the assumption by the purchaser of approximately $689 million USD in existing debt.

Wind turbines

The transaction includes the sale of six fully contracted wind and solar assets with an average contract life of about 16 years.

“We are pleased to reach this agreement with CPPIB for the sale of our Canadian portfolio, which we expect will be accretive to NextEra Energy Partners’ long-term growth,” said Jim Robo, chairman and chief executive officer. “The sale of these assets, at a very attractive 10-year average CAFD yield of 6.6%, including the present value of the O&M origination fee, highlights the underlying strength of the partnership’s renewable portfolio.”

 

 

An affiliate of NextEra Energy Resources will continue to operate all of the facilities included in the transaction under a 10-year services agreement with CPPIB.

“As discussed during our earnings call in January, we expect the sale of the Canadian portfolio to enable us to recycle capital back into U.S. assets, which benefit from a longer federal income tax shield and a lower effective corporate tax rate, allowing NextEra Energy Partners to retain more CAFD in the future for every $1 invested. We expect to accretively redeploy the proceeds from this transaction to acquire higher-yielding U.S. assets from either third parties or NextEra Energy Resources,” added Robo.

The transaction includes the sale of six fully contracted wind and solar assets, with an average contract life of approximately 16 years and 10-year average CAFD of $38.4 million. Located in Ontario, the portfolio has a combined total generating capacity of approximately 396 MW and consists of:

  • Bluewater, a 59.9-MW wind generating facility;
  • Conestogo, a 22.9-MW wind generating facility;
  • Jericho, a 149-MW wind generating facility;
  • Summerhaven, a 124.4-MW wind generating facility;
  • Moore, a 20-MW solar energy generating facility; and
  • Sombra, a 20-MW solar energy generating facility.

NextEra Energy Partners expects the sale to close during the second quarter of 2018. The transaction is subject to receipt of regulatory approvals and satisfaction of customary closing conditions.

Wind turbine construction destruction: “the rules are just made to be broken”

March 5, 2018

Roads blocked without notice on Amherst Island: breaking all the rules and getting away with it (Photo: Brian Little)

“All the rules are made to be broken”

Representatives of three community groups where wind turbine projects are currently under construction, addressed the Wind Concerns Ontario conference in Kingston this past weekend, and told hair-raising stories of violations of Renewable Energy Approvals, disobedience of municipal orders, ignoring conditions of road use agreements, and more.

Anne Dumbrille, chair of the County Coalition for Safe Appropriate Green Energy (CCSAGE-Naturally Green) and Orville Walsh of the Alliance to Protect Prince Edward County (APPEC), both based in Prince Edward County, detailed the abuses of the Renewable Energy Approval and IESO contract by Germany-based wind power developer wpd in construction of the contentious White Pines wind power project.

The White Pines project was originally planned to produce electricity for Ontario’s surplus-laden power grid via 29 huge wind turbines. A successful appeal based on heritage aspects of The County reduced the turbine number to 27; another appeal (Hirsch v. MOECC) was partially successful and saw the project reduced from 27 to 9 turbines, based on harm to endangered species.

“We had been operating under the belief that having to meet the 75 percent of power requirement in the contract with the IESO [Independent Electricity System Operator] actually meant something,” said Walsh. “It turns out, it doesn’t. Contracts don’t mean anything — they can do whatever they want.”

Dumbrille echoed that with a litany of abuses. The White Pines project is way past its specified commercial operation date, she said, which should mean the IESO could terminate the contract, but it hasn’t. “The Long Stop Date has no meaning or relevance, despite being in the regulations,” she said. “The decision appears to be political.”

The public also expected that while the power project was being appealed, construction work would not be allowed, particularly in the areas presented as habitat for the endangered Blandings turtle, but in fact, both the MOECC and the Ministry of Natural Resources and Forestry allowed it. Only when citizens took action in court was a stop work order achieved.

“Why must citizen groups rather than government protect habitat destruction?” Dumbrille asked.

The land clearing in turtle habitat continued after the appeal for the nine remaining turbines outside the limits imposed by the Environmental Review Tribunal. Again, citizens went to court, and again a stop order was issued, but not before habitat was destroyed. A transmission station is planned to be built in a stream bed which is against regulations and will require the taking of water. Again, the MOECC appears to side with the power developer on all issues.

“All the rules are made to be broken,” said Dumbrille, “to benefit the wind power developer. And the public has no right to information, apparently.”

Janet Grace, past chair of the Association to Protect Amherst Island (APAI), described numerous violations of the Renewable Energy Approval, road use agreements, and provincial safety regulations by “Windlectric” a shell company developing a power project on the island for Algonquin Power. Construction staff and vehicles are supposed to be using a barge to get to the island, she said, but they’re not: instead, they use the passenger ferry which is resulting in delays for Island residents, many of whom work across the water in KIngston, and concerns about safety.

Roads are blocked without notice, and construction throughout the winter has virtually destroyed roads, so much so that the municipality Loyalist Township issued a stop work order. Resident photographs indicate however, that the order was ignored, with the power developer construction firm continuing work. In addition, Grace said, the company is supposed to stop work at 7 PM, but in reality is working until 11 PM.

“The sad thing is, Grace said, “we know this is just the beginning of what is being done to our Island. There are rules being broken, and violations … the MOECC gives them exemptions. They’re just getting away with it all.”

 

Surplus wind power costs millions: Parker Gallant

March 5, 2018

Parker Gallant : hydro and nuclear could have done the job and saved millions mismanagement. [Photo: Metroland Media]
Being asked to do a presentation at Wind Concerns Ontario’s annual conference this past Saturday, to describe the costs associated with industrial wind turbines was something I relished!

The presentation I developed used IESO information for 2017.

Discovered in the preparation of my presentation was the fact that that nuclear and hydro power alone could have supplied over 100% of all grid-connected consumption for 2017, at a average cost of about 5.9 cents per kilowatt hour.

The cost for Class B ratepayers in 2017 however, was almost double, coming in at 11.55 cents per kwh.

So why the big jump? Have a look at the presentation to see why and look at Slide 6 in particular where you get an inkling of how IESO view the reliability of industrial wind generation in their forward planning process!

PresentationParkerPPT final

(Reprinted with permission from Parker Gallant Energy Perspectives)

Wallaceburg citizens demand public meeting for answers on Otter Creek wind power project

With few details on how a fragile geology will be affected by wind turbine construction, and no information on noise assessments of turbines that are just prototypes, citizens are worried about water supply, health and safety

Water from Dover area wells showing sediment. The same geology is present for the Otter Creek project. [Photo: Sydenham Current]
January 21, 2018

 Wallaceburg Area Wind Concerns

News Release

Community Group demands a reset of the Otter Creek application

Citizens’ group Wallaceburg Area Wind Concerns (WAWC) has asked the Ministry of the Environment and Climate Change (MOECC) to halt the Otter Creek application process until all the missing data is complete, to follow the REA process for public input, and to hold another public meeting to present this information to the community.

The group sent a letter to the MOECC Tuesday via its lawyer.

Executive members of WAWC met with representatives of power developer Boralex and members of CK council December 7. At that meeting, WAWC learned that the noise assessment data for the as yet untested Enercon turbines was not complete, and there was no timetable for when it would be available.  Boralex also indicated that the developer is considering another option for the turbine foundations, and that geo-technical testing was being planned, but again there was no date for the testing.

“We’re very concerned that there is not enough information for two critical aspects of this power project, noise and the foundations,” says Violet Towell , WAWC spokesperson. “We have asked repeatedly for the facts about the effect of the noise from these huge turbines on residents, and what the impact on water wells will be from construction and vibration during operation.”

In spite of the lack of information that is clearly required for the Renewable Energy Approval for this power project, requests for a public meeting have been denied.

Last week, residents in the Wallaceburg area were shocked to learn that pile driving had begun at a number of sites for the Otter Creek project. The developer had sent letters to a handful of residents with limited information and even more limited notice.  Most of the larger community was uninformed of the activity by Boralex.

WAWC has questioned the choice of project site in an area where the soil conditions are not conducive to wind turbine construction, and also so near a town of 10,000 people. The developer’s response to WAWC was to confirm that the site was “far,far from ideal” but the company proceeded because Chatham-Kent was so accommodating.

“The Otter Creek power project must not be approved until residents of our community have accurate information about this project,” says Towell.   “There are many compelling questions not answered, key information that is missing, and changing project details. In order to protect our health, our homes and our community, we want answers now.”

Contact: WAWC@kent.net

Wind power in Ontario’s cold snap: not reliable

When demand for electricity and heating were at their highest, wind and solar production were at their lowest

–Stephen Aplin, Canadian Energy Issues

January 6, 2018

 

Ottawa-based energy analyst Stephen Aplin has taken on a portion of the work the Ontario government never did: an analysis of the benefits of wind power as part of Ontario’s power mix.

This week, with temperatures well below normal, is wind power achieving the promises made for it as a cheap reliable source of power?

No, says Aplin, in a comment on his Canadian Energy Issues website. “Bearing in mind the data presented [in his recent article], the answer is an obvious and emphatic, NO.”

Even if Ontario had ten times the capacity of wind and solar it does now, it still wouldn’t meet demand.

And before the pro-wind people jump up and say, We need MORE, Aplin says, that’s just  the usual from the pro-renewable energy salespeople — ” buy more of my inferior product.”

Aplin concludes by despairing of the renewables myth.

“In light of this, another monster-size question is begged. Why do governments all across the world regularly and routinely regurgitate the 100 percent renewables myth?

And why do the media types who interview the government types who regurgitate this nonsense not call them on it?”

Read the article here.

Challenges ahead in 2018 for social, environmental justice in Ontario

House Finch on Amherst Island: industrial-scale wind power development can’t trump environmental protection

January 1, 2018

Best wishes to all for the year ahead.

The Ontario government is still processing five wind power contracts awarded under the 2016 Large Renewable Procurement I (LRP I), despite concerns about the environment and health and the fact that Ontario has a surplus of power. With thousands of noise complaints recorded with the government unresolved, the Ministry of the Environment and Climate Change (MOECC) refuses to acknowledge that it has a problem, and refuses to look for causes, relying instead on its clearly inadequate set of regulations.

One of our favourite quotes in 2017 came from a hydrogeologist who pointed out, referring to the problems with water wells in Chatham-Kent, if you have a model that says you’re not going to have problems, then you experience problems, then it’s the model that is wrong.

The fact that wind power development on the industrial or utility scale has many significant problems — energy poverty, environmental damage, adverse health effects, negative impact on rural communities — is now better understood by the people in Ontario, and the media. In 2017, two major networks, Global News and Radio-Canada, carried multi-part investigative reports this past year. The three-part Global News feature spurred questions in the Legislature and forced the then-minister to act on noise complaints for several Huron County families.

The Huron County public health follow-up of noise complaints was finally launched by the Health Unit there; other health units are watching attentively. We believe 2018 will be the year when the Government of Ontario is forced to live up to its mandate and take steps to protect the health of its residents.

And, the legal battles continue, with actions taking place both inside the legislated appeal process for wind power projects, and in the courts. There have been victories: there will be more.

In her Christmas Message this year, the Queen spoke of the importance of “home”:  ” … the idea of home reaches beyond a physical building, to a home town or city,” she said.

We in Ontario think of our “home” as being our communities, the landscape, the natural environment — indeed, the entire province and all the people in it. We will continue to fight for justice for the environment and for families this year.

 

WIND CONCERNS ONTARIO

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Ontario’s energy policies mean expensive, disappointing Christmas Day

Wind power a bonanza for power corporations on Christmas, but meant a bad day for ordinary consumers

December 29, 2017

Ontario had enough surplus power to provide millions with free power for Christmas Day … but that’s not what happened

 

A quick review of IESO data for Christmas Day 2017 shows our Energy Ministry delivered lumps of coal to all Ontario’s electricity ratepayers, whether they were good or bad.  Those lumps of coal can be seen as a gift from all past and present Energy ministers who signed contracts for the industrial wind turbines liberally sprinkled throughout the province.

This year, the IESO data shows about 54,327 MWh* was curtailed (paid for but not delivered to the grid) and paid $120/MWH. That means wind power corporations were paid over $6.5 million  ($6,519,240 to be more precise) for NOT delivering that power.

The curtailed or wasted power was enough to supply almost 2.2 million average homes with power for the day, free.

Meanwhile, the IESO accepted about 25,680 MWh, so the curtailed/suspended generation was actually 2.1 times as much as grid-accepted wind power. Wind power corporations were paid $135 per MWh — that’s another $3,467,800 so the total bill for wind power for the day was $9,987,040.

What you paid them: 39 cents a kWh

Here’s what else it means: the 25,680 MWh of power actually accepted by IESO into the grid cost $388.77/MWh* or 39 cents a kWh!  And, that 39 cents a kWh doesn’t include the costs of gas plant backup, spilled hydro or steamed-off nuclear, all of which applied on Christmas Day.

What you got paid: 1.9 cents

That’s not all: at the same time, the IESO was busy exporting surplus power to our neighbours in New York and Michigan at an average of 1,993MW (net-total exports less imports) per hour. We practically gave away 48,000MWh (rounded) at a cost to Ontario ratepayers of over $4 million.  So, Christmas Day, the day of giving, ratepayers coughed up $14 million for unneeded power whether they could afford it or not! That $14 million raised the cost to electricity customers by about $40/MWh or 4 cents/kWh.

Christmas Day is supposed to be a day of joy and giving. In Ontario though, it was a day when the result of government energy policies and mismanagement furthered hardship for many.

(C) Parker Gallant,

December 27, 2017

 

* Calculation is simply $8,083,200 + $3,467,800 = $11,551,000/25689 MWh = $449.80/MWh

Wind power: not needed in Ontario, say energy experts

December 8, 2017

The final part of the ICI Radio-Canada series on wind power in Ontario aired December 8.

This is a translation of the E-zine version of the story.

[Photo: Nic Pham, ICI Radio-Canada]

Unserviceable wells, contaminated water, noise, citizens concerned about their health, wind farm issues are increasingly being blamed in southwestern Ontario, and many communities are mobilizing to oppose the development of their homes. New projects. Yet, for two decades, the number of wind farms has been increasing. So why do we need so many wind turbines?

Reportage and photos: Nicolas Pham Text: Marine Lefevre Edim and infographics: Vincent Wallon

 

Experts say that wind energy is not absolutely necessary in Ontario. The province has been experiencing energy surpluses for several years and the intermittent electricity produced by wind turbines is, at the present time, mainly an extra energy source.

A SATURATED MARKET

“We do not need these turbines for the moment,” says Jean-Thomas Bernard, visiting professor at the Department of Economics at the University of Ottawa. A message relayed by Pierre-Olivier Pineau, holder of the HEC Montréal Energy Sector Management Chair.

According to both researchers, demand in Ontario has declined significantly in recent years. The economic crisis of 2008-2009 brought down demand in the industrial sector, and rising prices at the residential level encouraged the public to save energy.

On the supply side, the province relies primarily on nuclear energy and hydroelectricity. The combination of these factors results in the production of wind farms being added to other energy production.

“With a low demand, we have surpluses. ” – Pierre-Olivier Pineau, who holds the Chair sector management Energy HEC Montreal 

 

In addition to this, wind generation does not adequately meet the energy needs of consumers. In any case, this is indicated in a study published in June 2017 by the Council for Clean and Reliable Energy, which deals, among other things, with the effect of installing wind turbines on the province’s electricity grid.

“The analysis shows that the intermittency of the wind makes it an unproductive and expensive choice that does not meet the needs of customers and also compromises the price of electricity exports”, reads the introduction to the report by Marc Brouillette , Senior Consultant at Strategic Policy Economics (Strapolec)

Based on data from the Independent Electricity System Operator (IESO), the author indicates that in 2015 Ontario’s wind farms operated at less than one third of their capacity, approximately 60% of the time.

In addition, the report states that wind turbines are usually in operation when the province’s grid is least in need of electricity.

“Ontarians’ energy consumption is highest in winter and summer, and lowest in spring and late fall, which is almost a mirror image of wind generation models because the wind is the highest in spring and autumn, “says the author.

In conclusion, wind energy does not meet the needs and forces the use of other forms of energy to fill the gaps, but in addition this irregular production contributes to the average surplus of the energy production, which also has a cost.

In 2015, wind energy accounted for one-third of excess core production outside of peak periods in Ontario. That year, the only wind surplus cost consumers $ 370 million on a total bill of about $ 550 million.

In addition, these surpluses have an effect on the price of this energy, especially for exports, where this energy is sold at a loss because it is difficult to store. According to the author, this report puts into question the entire past, present and future deployment of wind resources in the province.

WHY INVEST IN WIND?

One of the reasons for this is the intention of Dalton McGuinty’s government (2003-2013) to make an industrial transformation in Ontario.

In a context where the province’s traditional industries such as pulp and paper, metal refining and even the automobile sector were losing their wings, the Liberal government of the day wanted to convert the province to renewable energy. solar and wind, to create a new industrial sector in Ontario.

At the same time, as the fight against climate change intensified, investments in this green energy sector became natural.

“It was done to encourage renewable energies when we were aiming for the closure of coal plants. ” – Jean-Thomas Bernard, a visiting professor in the Department of Economics at the University of Ottawa 

 

For the government, massive investment in the sector also reflects a desire to diversify energy sources and protect Ontarians from unforeseen events, especially over the long term.

A reasonable approach even if it means having surpluses for several years, says Pierre-Olivier Pineau, particularly in a context where the objective is to have an electricity sector that no longer emits greenhouse gases.

“It may seem like a long time, but in electricity you invest for periods of 20 to 30 years. It is difficult to predict economic conditions and we always keep an extra capacity to be able to meet the demand, “he says.

According to him, the government announcements [were] a bit premature in the wind industry in Ontario, and elsewhere in Canada, a response to the positive perception of the electorate towards this [form of] energy.

“For politicians, we still have image gains to make by announcing green policies, focused on sustainable development. And pictures of wind turbines, and green energy contracts, these are beautiful images,” says the researcher.

THE FAILURE OF A POLICY

The wind shift did not happen as planned, however, explains Jean-Thomas Bernard. Ontario has been unable to create a new industrial sector.

“It did not work because Ontario produces little wind equipment. Major turbine manufacturers are Denmark, Germany, the United States and China. The Ontario market is not big enough to provide a foundation for development, “he says.

“We have invested in wind power, but the bill comes later, so it creates a political problem to announce an increase in the price of electricity. » – Pierre-Olivier Pineau 

 

Wind power not justified by the market

The Ontario government put a halt to new project grants in 2016,* but it remains contractually bound to buy electricity from existing wind farms at fixed prices.

“There is no jurisdiction where the market price justifies wind energy investment. Once the government decides to have wind generation capacity, it is obliged to guarantee prices. » – Pierre-Olivier Pineau 

 

This guarantee forces Ontario to purchase electricity at a fixed price, regardless of the demand and lower production costs associated with the technological evolution of the sector.

A difficult situation for the province, which has invested millions of dollars in a sector that looked promising as it faces an economic situation where electricity demand is lower.

“Electricity rates are increasing by 5% per year as a result of this firm price policy for renewable energy. If we had not developed them, today there would be a drop of 5% per year. “Adds Jean-Thomas Bernard.

Ontario is not unique, Quebec and Alberta have also had to guarantee prices to energy companies.

On the other hand, the manner of proceeding, by call for tenders in particular, made it possible to establish lower fixed prices. In addition, the importance of hydroelectricity in Quebec and oil in Alberta makes the wind industry very secondary in these provinces.

A COMPLEX SITUATION

For these experts, the energy sector in Ontario is generally in an unenviable position. Prices are high and the energy policies put in place for several years have not yielded the expected results.

“The current government has chosen to have both nuclear and wind power with the problems we know in terms of price. And these problems will not disappear in the future because the rehabilitation of nuclear power and wind will be very expensive in the years to come, “says Pierre-Olivier Pineau.

And even though over the last year the government has lowered rates twice, including reducing the sales tax, the real question remains: are we able to produce electricity at a lower cost? “Not today,” concludes Jean-Thomas Bernard.

Part 1 | In the land of black water 
Part 2 | Opposition rumbles
Part 3 | Wind turbines: green energy at all costs?

 

  • WCO note: it is not correct to state the the Ontario government has halted its wind power procurement program. The Large Renewable Procurement program has been put on hold due to a surplus of power, but it is not gone. Meanwhile the Ontario Ministry of the Environment and Climate Change (MOECC) is currently processing five more applications for large-scale projects, for 300 megawatts of intermittent, unnecessary power.