Canada is a land of Mounties, moose and maple syrup. But its per capita greenhouse gas emission levels trail only its neighbour, the USA, and its dirty energy rival, Saudi Arabia.
But could it be that Canada is on the cusp of a clean energy revolution, even as provinces such as Alberta, home to the controversial tar sand fields, lead a dirty energy revolution? Could it, in fact, become the new Germany of solar PV?
Ninety-five per cent of Canada's solar industry is in Ontario, the country's largest economy. When you look at Ontario's generous feed-in tariff [see slide 1], it's easy to see why. Ontario now has 2GW installed, with a projected additional 2GW over the next four years. When you compare that to the US milestone of 10GW reached this year, the country that has a population of 35 million (just a little over that of California's) looks like a nation that clearly punches above its weight.
John A Gorman, president of Canadian Solar Industries' Association (CanSIA), said: “Four years ago, Ontario introduced a very aggressive FiT programme. In 2009, there was hardly any installed solar PV capacity in Ontario and the thinking behind introducing very high FiT was to try to grow an industry. The programme succeeded in doing that.”
But in May this year, Ontario made some dramatic changes to its FiT programme: it scrapped its domestic content rule and replaced FiTs for large-scale projects (over 500kW) with a competitive procurement process.
ABB's recently announced US$80 million contract to supply its inverters to Canadian Solar's 100MW Grand Renewable Energy Park in Ontario (Canada's largest PV power plant) has to be one of the biggest wins since domestic content requirements were forcibly dropped.
Across Ontario, it is projected that 900MW will be developed through residential and commercial FiTs and a projected 1.1GW will be developed through utility-scale competitive procurement.
The Ontario Power Authority (OPA) this week announced that it is accepting applications for 123.5MW worth of small FiT projects with a proposed capacity of more than 10kW and generally up to 500kW. The deadline is next month, so there will be some visibility then as to how successful the programme will be.
“The problem with the programme was that it started off so aggressively and was so over-subscribed that we ran into stops and starts,” said Gorman. “Combined with the domestic content protectionist measures they were a turn-off to all but the bravest international players.
“Despite that, we've been able to make some substantial improvements in the programme – by any measure, there has been a great deal of success today in that installed capacity. The initial stops and starts have been addressed and there is a smoother and faster process on residential and commercial.”
But how much power does Ontario really need? According to Gorman, wavering on old nuclear and a recent government announcement that there will be no new nuclear in Ontario is a golden opportunity for solar.
“We've had a very positive response from municipalities and public, that's been very different from the wind industry and the gas industry and the nuclear industry,” he said. “At a time when we're making some very important decisions about what proportion of the electricity mix is going to be solar versus other technologies, solar has quite an advantage.
“The government is not committed to refurbishing old nuclear and we know we're going to need new capacity as early as 2016 – we don't know exactly how that's going to be filled. That could be a real game changer for us.”
It's not too hard to imagine a SolarCity or Sunrun third-party ownership model taking off in the province to fulfill residential demand, he added.
While Ontario's solar industry grows apace, Alberta is looking to follow. Alberta is Canada's second largest economy after Ontario and has the second largest reserves of oil and gas in the world.
“Alberta is well known as an oil and gas superpower,” he said. “It is constantly fending off attacks that it is an irresponsible developer of those things.
“The province is under a lot of pressure to show environmental responsibility and earn the social licence it needs to continue to promote gas and oil and develop to export it.”
Alberta's tar sands may end up being pumped through the controversial Keystone XL pipeline project, if it ever gets built. Meanwhile, the province could do a lot to clean up its electricity generation since a whopping 70% of it comes from coal, a statistic that helps make sure that half of Canada's greenhouse gas emissions come from Alberta alone. The province also needs an additional 7GW in capacity over next 15 years.
Alberta, the dirty man of Canada, is about to put forward its own renewable energy framework, a draft of which will be published in the early part of 2014 with a view to starting the programme in the third quarter of 2014.
Alberta's market is nascent, without entrenched players Gorman points out. It also has the best solar resource in the country and rising electricity costs. But the province will look to its neighbours to the south rather than east for tips on how to develop a renewables industry, according to Gorman.
“The Alberta government is going to go for a US-style solution,” said Gorman. “It's not going to be a FiT programme. The experience that you have here in America is going to be valuable there. There is no solar market to speak of Alberta, which means that when it comes to utility-scale stuff there's going to have to be a lot of learning that has to be done in that market and a lot of experience is going to have to come from elsewhere.
“They have the best solar resource in the country and they have rising electricity costs, which is great for solar. They also have a province that really understands the value of an energy resource.”
However, it's likely that the large oil and gas players in Alberta will dominate. But there will still be opportunities for the American developers to head north, away from overheated or overly competitive markets in the US. The sun, after all, shines on Ontario and Alberta even more than Germany.
This article has been updated to clarify details of Canada's greenhouse gas emissions