When Samsung announced in January that it and a consortium had secured a C$7 billion deal with the Ontario government, which included building 2,500 MW worth of wind and solar projects and equipment-manufacturing plants, it raised plenty of eyebrows with developers.
The consortium includes Samsung C&T Corp., Pattern Energy, Korean Electric Power Corp. and CS Wind, a Korea-based wind tower manufacturer. The projects will be eligible for Ontario's feed-in tariff (FIT).
Recently, NAW spoke with Mike Garland, CEO of Pattern Energy, which will be developing 1,200 MW worth of wind projects as part of this deal.
Pattern Energy, along with Samsung, will develop 1,200 MW of wind energy in three phases of 400 MW each. The projects will either be new developments or acquisitions of planned developments. Garland expects the first phase to be online by the end of 2012, with the second and third phases scheduled for completion in 2013.
He acknowledged the skepticism the Samsung deal created with developers, who felt the government's actions contradicted one of the central tenets of its landmark Green Energy Act (GEA) of 2009 – the right to connect.
‘Anytime anyone says you have priority interconnection rights, it sounds like you jumped the line,’ Garland explains. ‘On the other hand, the province wants to jumpstart the FIT program and is creating huge opportunities for developers.’
Just the same, he says, trying to get such large amounts of energy onto the grid requires a bit of reprioritizing.
‘We're running full tilt at this thing, and it would be very difficult for very many parties to meet the requirements of the province,’ he says.
Brad Duguid, Ontario's minister of energy, agrees that certain parties were unsettled by this deal, but says the province is focused on becoming a clean energy leader.
‘There were interests out there that would like to get access to the available transmission for projects, and our responsibility is to build out renewables,’ he says. ‘Our long-term energy plan has us going from 3 percent to 13 percent by 2018, so we have an aggressive target. We're investing heavily in transmission. We've built 3,000 km of upgraded transmission over the last number of years and will continue to invest significantly in that area.’
As part of the deal, Samsung is required to build four manufacturing facilities in Ontario. Siemens recently unveiled Tillsonburg, Ontario, as the location for a wind turbine blade manufacturing plant that will produce 600 MW worth of blades for Samsung and Pattern. The facility, which will be located in an existing 253,000 square-foot plant, represents an investment of C$20 million for Siemens. It will produce blades for the company's 2.3 MW wind turbines.
Renovations to the facility are expected to begin later this month, and it is scheduled to be production ready in October, according to a press release issued by Siemens.
CS Wind recently announced that it will build a wind tower plant in Windsor, Ontario. Duguid speculates that the proximity of the plants' locations to the U.S. border could create export opportunities.
‘One of the reasons they're close to the border is they'll be available to provide wind tower products to the American market as well, I expect,’ he says, adding that details about the second and third plants are expected to be released early next year.
The plants will also help fulfill a domestic-content requirement that is part of the GEA's FIT program. For wind, 25% of the content must be local. The requirement increases to 50% in 2012. For solar, 50% is required to be local content, and this number increases in 60% in 2011.Â
Samsung has stated in press releases that it intends to use 100% Ontario steel in the renewable energy projects, such as the steel needed for wind turbine towers.
