A new process to select sites for renewable energy projects was “open, fair and transparent,” says an evaluator hired to ensure selectors followed all the rules.
But critics are furious the same rules let wind firms with low bids trump municipal objections and the “transparent” process doesn’t yet let them know why.
“We were involved in the process of the initial guidelines . . . and we said there had to be co-operation and support from the community (for a successful bid),” said Cameron McWilliam, mayor of Dutton-Dunwich. “And we didn’t get it. We got ‘community engagement,’ which is what we’d have with any development . . .
“That’s not what we were led to believe were the terms.”
A week after Invenergy got the go-ahead to negotiate a contract with the province for 20 to 25 turbines in Dutton-Dunwich, the municipality is still awaiting word on why it’s getting a project opposed by 84 per cent of the residents who voted in a referendum.
“We don’t have any information as to what the criteria were and what criteria they met,” McWilliam said.
The green energy contract selection process was designed and run by the Independent Electricity Systems Operator (IESO), a not-for-profit corporation overseeing Ontario’s power system.
Previous rounds of wind energy contracts drew allegations of political interference, including a NAFTA lawsuit by U.S. energy tycoon T. Boone Pickens against Canada. Pickens’ suit, claiming $650 million in damages after his company was denied a contract for a wind farm near Goderich, awaits a NAFTA tribunal ruling.
For this latest round of wind farm procurement, an outside firm was hired as a “fairness advisor.”
The firm, Knowles Canada, in a March 9, 2016, letter posted on IESO’s website, said the procurement in their opinion “fully met provincial standards of an open, fair and transparent process.”
Under the old process of the 2009 Green Energy Act, Ontario set rates it was prepared to pay wind, solar and hydro producers per kilowatt-hour generated.
Under the new process, developers had to submit a price they were willing to accept. Their bid would be weighed along with other factors, including community support from municipal councils, nearby landowners and First Nations.
An energy developer offering a lower price, but no community support, might still win a contract offer; a developer with community support, but a higher price, might not.
In Malahide, just east of Dutton-Dunwich, for example, council backed Capstone Power Development’s plan to expand its Erie Shores Wind Farm, but the bid was unsuccessful.
“A lot of very, very positive things were working in that project’s favour,” said David Eva, a senior Capstone vice-president, noting “very strong support” of host municipalities and other features made it “very viable.”
Meanwhile, McWilliam said he’d like to see the numbers now. “IESO is making a big deal about the (open) process, but why can’t they share that? It’s taxpayers’ money.”
His municipality sent a terse email to Energy Minister Bob Chiarelli, noting council had met him “on numerous occasions” to make the ministry aware residents had “clearly stated they did not want an industrial wind turbine project.”
McWilliam maintains if a municipality doesn’t support a proposal, that should be a deal-breaker.
“It’s a slap in the face for sure for rural Ontario,” he said. “Everybody is scratching their heads.”
The process in a nutshell
Before bids were accepted, developers had to meet mandatory requirements, including creating a publicly accessible website, meeting local officials to discuss particulars, and holding at least one public meeting
Accepted bids were evaluated on a point system awarding as many as 80 points for community engagement for, for example, showing at least 75 per cent of landowners near a wind farm were behind a project or that a municipal council had passed a resolution of support. Another 20 points could be won by demonstrating the backing of a local First Nation.
In the next stage, IESO opened price bids from the wind developers. If a developer had scored 100 points in the previous step, their submitted price would be considered 40 per cent lower, putting them in a more competitive position.
IESO then evaluated proposals to see if there were connection points and transmission capacity available for the power to be generated
Contract offers under new process
- 16 contracts to provide 455 MW of energy capacity: five wind, seven solar and four hydroelectric contracts.
- Developers requested contracts for more than 100 projects
- 75 per cent of successful bidders had support of local municipalities
- 60 per cent had support from abutting landowners.
- Three of five wind contract offers were made despite municipalities declaring themselves unwilling hosts.