Enbridge to buy solar farm
Pipeline giant Enbridge Inc. is pushing further into the renewable-energy market, announcing today a plan to purchase the largest solar power farm in Canada from U.S. solar manufacturer First Solar Inc.
Enbridge, the country’s biggest distributor of natural gas, said it will spend $100 million this year on its solar strategy, and expects its newly acquired Sarnia Solar Project to be fully operational by the end of this year.
"The Sarnia Solar Project is right in the sweet spot of Enbridge’s renewable energy strategy," said Enbridge president and chief executive officer Patrick Daniel. "It has risk and return characteristics which are fully consistent with Enbridge’s low-risk business model, and similar to our crude oil pipeline business."
The projects were originally owned by California solar manufacturer OptiSolar Inc., which had obtained 20-year contracts with the Ontario Power Authority to sell its solar electricity into the provincial grid for 42 cents per kilowatt-hour.
Those contracts were obtained under an older renewable-energy standard offer program (RESOP), which has since been replaced with a new feed-in tariff (FIT) program launched last month.
But OptiSolar ran into trouble during the economic downturn, so in April sold the rights to its Ontario solar projects to Tempe, Ariz.-based First Solar empire payday loans. Since then, First Solar has built more than 65 per cent of the 20-megawatt project, which on sunny days can put out enough power to meet the needs of 3,200 homes.
On average, the Sarnia Solar Project will produce 30 million kilowatt-hours annually, equating to revenues of $12.6 million a year for Enbridge. The company already owns four wind-energy projects in Canada totaling 260 megawatts, including a 190-megawatt wind farm in Bruce County.
"Subject to certain conditions, Enbridge may participate with First Solar in future solar energy projects at the Sarnia site," the company said.
First Solar will continue to supply its thin-film solar modules to the Sarnia Solar Project. The RESOP program, unlike the new FIT program, does not have local content rules that make it difficult to use foreign-made solar equipment.
Enbridge won’t be alone in owning a massive solar farm in Ontario. Toronto-based SkyPower Corp. and joint-venture partner SunEdison LLC from Maryland have completed a 9-megawatt project near the town of Stone Mills. It is the first phase of a 19-megawatt solar farm called First Light.
Several other multi-megawatts solar farms in Ontario are under construction or in early development.