REpower Systems, a subsidiary of Suzlon Group, says it will build – or retrofit – a rotor-blade manufacturing facility in southern Ontario as part of a turbine supply agreement the turbine maker recently signed with developer wpd Canada.
The agreement includes the delivery of 52 REpower 2.05 MW MM92 cold-climate-version wind turbines for six wind farms in Ontario. The wind farms have a combined capacity of 105 MW and will be located in Simcoe, Middlesex, Prince Edward, Dufferin, Wellington and Kawartha Lakes counties.
REpower's announcement is significant, but it was not unexpected, as the company had been planning to expand beyond Quebec, its Canadian headquarters, for more than a year. REpower has been operating in Canada since 2007 and has connected 84 MW of installed capacity to the grid. In the coming months, the company says 350 MW will be connected.
‘Ontario is an important market for us,’ Helmut Herold, REpower's managing director, tells NAW. He expects the facility to open in spring 2013, with the first REpower 45-meter blade to roll off the assembly line sometime in the middle of next year.
Herold says the company is close to deciding whether it will construct a new facility or retrofit an existing one. Just the same, the blade plant is an important piece in complying with Ontario's 50% domestic-content requirement established under the province's Green Energy Act.
Ontario requires developers that participate in its feed-in-tariff (FIT) program to source at least 50% of wind project content within the province. Wpd is providing 20%, with REpower contractually committed to 30%, according to a REpower spokesperson.
Establishing the rotor-blade facility – as well as locally sourcing towers and step-up transformers – will enable REpower to fulfill the 30%. The company expects to hire 10 local workers initially for the facility – a number that is expected to grow to ‘several hundred medium- and long-term jobs."
The turbine supply agreement also includes a 15-year maintenance contract that could also make a small impact on the local labor force, Herold notes.
Herold says the Ontario-based plant will be modeled after REpower's two existing blade-manufacturing facilities located in Portugal and Germany. In the future, the plant will also have the capability to manufacture rotor blades for 3 MW wind turbines, Herold adds, although he would not divulge specific rotor-blade sizes of the 3 MW turbine class. (REpower has three such models.)
As is the case with any market, there are challenges – and Ontario is no different. The provincial government recently updated the rules pertaining to its FIT program, which, for wind, emphasizes small-scale projects.
Furthermore, the World Trade Organization (WTO) recently found that Ontario's domestic-content program unfairly discriminated against foreign suppliers. While the WTO has not publicly disclosed sanctions against the province, changes to Ontario's local-content requirements may be forthcoming.
Nonetheless, REpower remains unfazed. ‘REpower is continuing to grow its business in the province independently from the political conditions,’ Herold notes.
Photo: REpower's 2.05 MW MM92 wind turbine; image courtesy of REpower Systems