Offshore Wind

Why Windstream Energy believes it stands a chance of developing its 300 MW offshore Wolfe Island Shoals project in lake Ontario.

By Rikki Stancich

Canadian wind developer Windstream Energy’s decision to push ahead with a proposed 300MW offshore wind farm up to sixteen kilometers off the southwest shore of Wolfe Island, eastern Lake Ontario, sends a clear message to Ontario’s local authorities.

Windstream Energy is currently the only offshore wind developer in possession of an offshore wind power Feed-in-Tariff (FIT) contract in the Province of Ontario, which was awarded by the Ontario Power Authority in May 2010.

But when Ontario’s government unexpectedly placed an indefinite moratorium on all offshore wind power development in the Great Lakes last February, Windstream Energy’s project - along with many other developers’ - was left in limbo.

At the time, the government explained that more studies were needed before it could approve any offshore wind projects. Several months later, however, local government officials told developers: “There is no political appetite to deal with offshore wind, either before or after the election.”

The offshore wind moratorium has dealt a crippling financial blow to local developers, and has cost the province billions in foregone gross domestic product and tax revenues. A study published at the end of 2010, indicates that installing 10GW of offshore wind would create roughly 32,000 jobs, C$25bn in gross domestic product, C$50bn in capital investment and C$5bn in tax revenues.

Now it appears that developers have tired of the waiting game. Windstream’s announcement earlier this month that it has signed a binding turbine supply contract with Siemens for its Wolfe Island Shoals project, revealed the company’s steely resolve to get offshore wind back on Ontarios’ agenda.

Wind Energy Update's Rikki Stancich gets in touch with Randi Rahamim, Vice President of merchant bank Bridgepoint Group, on behalf of Windstream Energy, to learn how the developer intends to ensure the government fulfills its contractual obligation.

Wind Energy Update: What is the current status of the moratorium on offshore wind in the Great Lakes?

Randi Rahamim: The moratorium is still in effect.

Wind Energy Update: Windstream Energy holds the only offshore wind power Feed-in-Tariff (FIT) contract in the Province of Ontario. Is this FIT still valid, in light of the moratorium?

Randi Rahamim: We have a binding contract with the provincial government.

Wind Energy Update: Why does Windstream believe its Wolfe Island Shoals project will succeed - and profit - where so many other Canadian developers before them have failed?

Randi Rahamim: There are close to 4000 MW of installed offshore wind capacity in Europe. I disagree that so many have tried and failed.

Wind Energy Update: Given Canada's position on Kyoto, and its energetic exploitation of shale gas, tar sands and arctic oil reserves, is it possible that Windstream may be fighting a losing battle for offshore wind?

Randi Rahamim: We are focused on our project, which has a contract with the Ontario Power Authority for a 300 MW offshore wind power project.

Wind Energy Update: How does Windstream propose to get its 300MW offshore wind farm off the drawing board?

Randi Rahamim: We respect the government's desire for more studies. We believe the only way forward is to study a real project. We are hoping that the provincial government will allow us to move forward as a pilot project, without necessarily lifting the moratorium on offshore wind. This will allow them to meet their contractual obligations to us, and their need for additional studies.

To respond to this article, please write to: Rikki Stancich

Image credit: Windstream