The Canadian Solar Industries Association held its annual conference in Toronto this week and a more than doubling of attendance showed that solar technologies are being taken much more seriously in Canada, particularly Ontario. The province offers 42 cents for every kilowatt-hour of solar electricity produced from small generation projects as part of its European-style standard offer program, which has sparked a wave of announcements around multi-megawatt solar farms in southern Ontario. The provincial government has eliminated sales tax on solar equipment, and new zero-interest loan programs are being tested to encourage greater residential and business uptake of solar PV and thermal systems.
But many in attendance, while being careful not to overly criticize current policies, said more needs to be done. They're arguing that the standard offer tariff for solar PV be increased to 80 cents. They want tariffs created for solar thermal systems. They want a stronger commitment to solar deployment as part of municipal, provincial and federal climate change plans, and building codes that make it mandatory for some solar -- particularly solar thermal, where Canada seems to have more local innovation and need -- in certain applications.
The reasoning behind this wish list is that Ontario's standard offer, while ambitious when announced, still doesn't pay enough to make solar PV economical to deploy. Many point to Michigan's introduction of legislation that would offer 65 cents for solar PV power as a demonstration that Ontario's program didn't go far enough and could lose momentum. They also point to the fact that two local solar companies have invested elsewhere -- ARISE Technologies is building a plant in Germany and Photowatt shut down its Ontario plant, sold its next-gen technology to Japan, and is expanding operations in France -- as evidence that any momentum Ontario had has, in fact, been lost.
I'm not entirely convinced. Photowatt's problems were largely attributed to mismanagement, not opportunity. Meanwhile, ARISE went to where the market was most mature and largest -- Germany -- so building its first plant in Ontario wouldn't have been a good business move at this time.
As for increasing the rate to 80 cents, I'm also not entirely convinced or opposed. The problem with this year's conference is that it didn't adequately address the issues that, it would seem, continue to require consideration of such a high tariff. When, for example, will technology prices start coming down and why haven't they already? Is the continuing high cost for solar PV a result of increased installation costs that are offsetting any reductions in technology costs? And if so, should ratepayers be subsidizing installers? We keep talking about the need for scale, and how this will drive down costs, but from where I sit demand for product isn't at issue here -- the industry can't keep up with demand.
Yes, I agree as many argue that the market will need some time to sort these issues out, but how long do we expect Ontario for example to pay 15 times the cost of what we currently pay for electricity until market forces kick in? I'm not saying we shouldn't pay 80 cents, I'm just saying I haven't heard a compelling business case why we should, other than presentations that point to the successes in Germany and Spain, where it's often difficult to make apples-to-apples comparisons.
The conference -- at least the parts I attended -- also dwelled a bit too much on R&D and public policy but didn't address equally important issues like the role that home developers, construction companies, and the real-estate industry have to play to assure large-scale rollout of solar PV and thermal systems. I didn't see a single representative from the building and construction sector, which is a key stakeholder with issues and concerns that need to be heard and addressed. I didn't hear talk of the need to draw attention to residential solar and other renewable energy systems in the real-estate industry, where the MLS system lets you search for homes with fireplaces and backyard pools but not for solar PV or geothermal. Do we need to start pushing for energy ratings on homes? Definitely, I say -- so why isn't this being pushed for?
If we're truly to see solar take hold in Canada we've got to engage these stakeholders and address these larger policy issues. Sitting around talking about how a net-zero home has been built at considerable expense by a bunch of unversity students is a nice touch, but it doesn't strike at the heart of what needs to be done to stimulate industry growth, nor does relying on government incentives that benefit solar manufacturers and installers more than they do consumers.
I'm a huge believer in the potential of solar -- more than wind, more than biofuels, more than CCS -- but the industry needs to move beyond academic discussion and grow up a bit, at least in Canada.
I will point out one thing, however: exhibitors at the conference didn't have all the fancy new thin-film stuff that we see at U.S. conferences, but we had a lot of great solar thermal applications. Solar thermal is a strength in Canada, it's a market that's ready today, and it's an area we need to play up in a big, big way. Let Silicon Valley claim superiority with solar PV, but Ontario has a huge opportunity to play a leading role -- the lead role -- in the North American solar thermal market.
Oh yeah, and another Canadian strength to watch for: making solar-grade silicon. Stayed tuned on that....
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