Canadian renewables failing as subsidies dry up

After only a year of operation, Siliken, a Windsor, Ont. based solar panel manufacturing plant is closing its doors and laying off hundreds of employees. Company brass charges the Ontario government with “luring” them in with promises of subsidies and incentives, but then “turning off the taps” once the company was established.

Once again we see renewable energy producers not being able to compete in the marketplace without massive infusions of tax dollars.

Solar panel manufacturer Siliken opened its Canadian manufacturing facility in Windsor, Ont., last spring. The Spanish company hired 120 staff and expected to add more as it ramped up production of photovoltaic panels over the next year. It was a good news story for Windsor, hit hard by the recession and layoffs in the automotive industry, and it suggested Ontario’s ambitious plan to replace traditional rust-belt manufacturing jobs with those in the emerging “clean tech” sector was bearing fruit.

But barely 12 months later, Siliken decided to close its doors and fire workers. It blamed the Ontario government for luring it to Canada with rich incentives, only to suddenly turn off the taps. “I compare it to being invited for dinner, but when you turn up there is no food,” says Paco Caudet, Siliken Canada’s general manager, referring to the province’s Feed-In-Tariff (FIT) program. It was introduced in 2009 and promised to pay some of the highest rates in the world for electricity generated by solar, wind and other renewable resources. At least that was the case until the province slammed the brakes on the program last fall, announcing a review and, later, sweeping proposed changes that included a more than 20 per cent cut in the price paid for solar power.

It was a setback. But the real damage was yet to come. With no new contracts approved since Oct. 31, and no official word on when the program will be restarted, many in the once-roaring industry have suddenly found themselves struggling for survival. In addition to Siliken, a wind turbine company called WindTronics shuttered its Windsor plant earlier this year, while Guelph, Ont.-based Canadian Solar, which has operations in Asia and Europe, is trying to cut costs. And installers of solar panels and other equipment across the province are dropping like flies (although many are reluctant to point a finger at the province lest it harm their chances of snaring a future contract).

18. July 2012 by Jason Hayes
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