Ontario Delivers $7 Billion Green Investment
Ontario has negotiated an agreement with a consortium, comprised of Samsung C&T Corporation and the Korea Power Electric Corporation, which will triple Ontario's renewable wind and solar energy generation and lead to manufacturing facilities being constructed in Ontario. The agreement stems from opportunities created for developers and investors through Ontario's Green Energy Act, and is expected to be among the first of many major investments to result from the leadership position Ontario has taken in green energy.
This consortium will be an anchor tenant in growing a new, vibrant green economy in Ontario.
The agreement will lead to more than 16,000 green energy jobs over six years and bring $7 billion of renewable generation investment to Ontario.
Jobs will be created during the construction, installation and operation of renewable energy projects as well as direct employment in manufacturing plants. In addition, the increased renewable energy development and manufacturing activities will support indirect job creation in areas such as finance, consulting and other manufacturing, service and development industries.
Renewable energy provided by the Consortium would qualify for Feed-In Tariff prices available to all eligible projects.
In addition to the standard rates for electricity generation, the Consortium will be eligible for an economic development adder (EDA). This adder is contingent upon the Consortium manufacturing partners operating four manufacturing plants according to the following schedule:
- Towers - in full operation by March 31, 2013
- Solar Inverters - in full operation by March 31, 2013
- Solar Module Assembly - in full operation by December 31, 2013
- Blades - in full operation by December 31, 2015
These manufacturing facilities will produce wind turbine towers, wind blades, solar inverters and solar assembly in Ontario, creating more than 1,440 manufacturing and related jobs in the renewable energy industry. The local availability of these manufactured components will also help other renewable energy developers meet the Feed-In Tariff (FIT) domestic content requirements. An additional 700 manufacturing jobs are also anticipated to supply components not manufactured by the Consortium.
In addition, working with their manufacturing partners, the Consortium fully intends to use Ontario-made steel in their renewable energy projects, such as the steel needed for wind turbine towers.
The total cost of the EDA, assuming the manufacturing facilities are built according to the schedule set out in the agreement, will be approximately $437 million (net present value) over the lifetime of the contracts.
The EDA is expected to add on average $1.60 annually to a residential bill over the lifetime of the generation contracts. This equates to an increase of about 0.1 per cent on a typical residential electricity bill.
More Renewable Energy
The Consortium is committed to the construction of 2,500 megawatts (MW) of renewable energy generation, 2,000 MW of wind power and 500 MW of solar. Construction is expected to occur in five phases, commencing in 2012. The first phase of the project is scheduled to be completed in 38 months. It will be a 500MW cluster (400MW of wind and 100MW of solar) that will be built in the Chatham-Kent and Haldimand County regions of Southern Ontario.
Assurance of transmission in subsequent phases is contingent on the delivery of four manufacturing plant commitments mentioned earlier.
Today, Ontario has nearly 1,200 MW of wind power capacity and about 40 MW of solar power.
Cleaner and Greener Environment
The Consortium's renewable energy projects will deliver an estimated 110 million megawatt-hours of emissions-free electricity over the 25-year lifetime of the project. That's enough power to supply the electricity needs of all Ontario homes for nearly three years. Over the lifetime of these contracts, the wind and solar projects will displace 40 Megatonnes of carbon dioxide (CO2, the leading greenhouse gas) compared to what would be emitted by equivalent gas-fired generation. That's equivalent to removing every single car off Ontario roads for one year.
The 2,500 MW of wind and solar power capacity to be built by the Consortium will triple Ontario's renewable wind and solar energy generation.
Leveraging Transmission Investments
The renewable energy projects committed to under this agreement will take advantage of the more than 20 transmission projects announced last fall. The transmission projects will unlock significant opportunities for green energy projects across the province. About $2.3 billion will be spent by Hydro One on transmission and distribution projects over the next three years.
Opportunities for all Ontarians
All projects under the agreement would be subject to the Consortium entering into required agreements as well as obtaining required licences and approvals. The government and the Consortium will ensure that any Duty to Consult obligations are met, and that Ontario's Aboriginal communities are engaged and where possible provided with economic development opportunities flowing from projects under the agreement. To ensure value for Ontarians, the consortium and the government have agreed to market rate lease of government lands.