Gerson-Lehman Group on Energy

Samsung Buries Ontario Deep into Third-World Abyss
January 24, 2010

this Analysis by: GLG Expert Contributor
Analysis of: [Canada]Samsung Signs $6.6 Billion Deal to Build Wind and Solar Power in Ontario
Published at: greeninc.blogs.nytimes.com
Summary
Economies of the Third-World are usually defined by “sweat shops” or “branch-plants” operations. The definition has recently been enforced onto the province of Ontario by Samsung’s “Green Deal” as a reminder to all, that the auto-industry “branch-plant” policies of 60’s have just found a worthy successor which -- as opposed to the already known perils of car industry – has, in the long run, all the features of setting the Province on the slide into the socio-economic oblivion.

Analysis


[ 1 ] Let’s start with assorted problems first, In 2006, the U.S. Department of Energy's Office of Energy Efficiency and Renewable Energy did a review of recent literature discussing the "non-technical barriers" and suggestions to make renewable energy use more palatable. We shall mention a few major issues that should have had a substantial impact on the Samsung decision-making deal and, as it is, would have cast even more ominous impact on the Province :


[1.1] High capital cost of renewable energy technologies compared with conventional energy.

[1.2] Failure to account for all costs and benefits of energy choices. This includes failure to internalize all costs of conventional energy (e.g., effects of air pollution, risk of supply disruption) and failure to internalize all benefits of renewable energy: e.g., cleaner air, energy security. ( NOTE: This issue is clearly ideologically tainted as the “air pollution”, if needed, can be totally alleviated by a fraction of the cost of installing the brand new -- and never, so far, having fullfiled the promises, anywhere in the world where it was installed – energy distributing environment from the scratch.)

[1.3] Inadequate workforce skills and training. This includes lack in the workforce of adequate scientific, technical, and manufacturing skills required for renewable energy development; lack of reliable installation, maintenance, and inspection services; and failure of the educational system to provide adequate training in new technologies.


[1.4] Contract bidding mechanisms: Governments place an obligation on supply companies to accept electricity from renewable energy generating technologies which have been awarded contracts by government. Generators win these contracts by taking part in a competitive bidding process organized by the government or a specified agent of the government. Historically, competition has usually taken place within technology 'bands', that is, such that competing bids are only compared between generators employing the same technology. For example, wind generator against wind generator. Essentially, this means there are usually different competitions going on at the same time for each technology. Generally, the lowest bids are awarded contracts, provided they meet any criteria set down by the government as part of the competitive process. Examples of such a mechanism in practice include the UK's Non-Fossil Fuel Obligation (NFFO), Ireland's Alternative Energy Requirement (AER) and the French EOLE.The only problem there is the lack of stakeholder/community participation in energy choices and renewable energy projects.
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[ 2 ] Let us now leave out the first two issues that are highly important; however, as they have been completely omitted by the Ontario-Samsung deal, there are issues [1.3] and [1.4] that tell the story in full:

[2.1] R. Denley wrote in The Ottawa Citizen:”…. In a global economy, the winners are the countries that develop companies of international scale, companies that create high-value jobs at home and produce big taxes that support their national governments. The also-rans can buy a slice of the second-tier action if they are willing to offer big enough incentives. It's much like colonialism, but the countries with the money don't have to go to the bother of running the colonies directly….” TheThird World definition indeed. It directly answers the issue [1.3] above that has been the Ontario curse from the day one and, with the 80’s to the new century educational and immigration patterns; it has fast started on the sure way South.

Ontario governments like to crow about how great this province is. The Samsung deal reflects a much different reality, a tacit admission that the best the Province is capable of is assembling things under careful supervision from foreign companies (Auto-Pact revisited.) To make it even more vivid, Samsung, which is a relative newcomer to the green energy business, has said it is looking to use expertise from its other heavy industry divisions, including its shipbuilding group, to establish itself as a major manufacturer of wind turbines!

[2.2] the deal had a familiar shape of a developing country “standard”. One partner was a successful international consortium with deep pockets and manufacturing expertise, the other a backward jurisdiction so hungry for jobs that it had to pay the big company what amounts to a bribe to do the deal. The whole thing was arranged directly with the jurisdiction's leader without the bother of competition. It's the kind of deal one might expect in the Third World, except that it was Ontario on the Third World side of the equation. But the worst is yet to come:


[2.3] there are numerous Ontario companies trying to get a foothold in the green energy business. After all, “wind turbines derived from the shipbuilding”, as was Samsung claim, don’t seem to be a rocket science métier. If the government had cut a similar deal to support made-in-Ontario innovation, it could perhaps have been justified. Instead, it is slamming the door on these Ontario companies right in their own backyard.

"The Samsung deal is not just about manufacturing wind turbines," said OEC spokesperson Paul Kahnert."…It's a private scheme to generate electricity at outrageous ... rates -for years to come…." Kahnert said the province's electrical utilities operators can buy, install and maintain made-in- Ontario windmills more cheaply without Samsung in the picture. The fact of the matter is therefore quite simple. The Ontario Government has given away $7B of taxpayer’s money to offshore interests with NO assurance that Ontario society’s investment will create the promised jobs and economies of scale for alternative power generation. There are, at least, two of possible explanations for this:


[2.3.1] One possibility is that companies make bids against future cost reductions, taking advantage of the preparation period that the mechanisms usually allow before the payment period begins. If the economics of development are not sufficiently attractive towards the end of this period then the project does not go ahead.

[2.3.2]Another possibility is that some companies actually make bids they know will never become economic and will never be developed purely to deny the opportunity for a successful bid to their competitors.

Analyses are solely the work of the authors and have not been edited or endorsed by GLG.This author consults with leading institutions through GLG
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Econ.Dev't Agency News

the Business Retention and Expansion (BRE) program is at the heart of everything we do here at ADEDA. Why? First and foremost, it gives us the opportunity to express our thanks for the contribution you've made to the community. BRE also enables us to effectively link local, provincial and federal programs and services. We also get a better sense of the specific business issues our entrepreneurs in Annapolis Digby are facing. Through the BRE process, we have learned that many local companies would like to improve their marketing skills. Here’s a great opportunity to do so:

INTERNET MARKETING FOR SMALL BUSINESS
Expert Internet marketing know-how can hard to come by, particularly when you’re working flat out at running your own business. The Broadband for Rural Nova Scotia initiative, with support from the Department of Economic and Rural Development, is sponsoring an inexpensive internet marketing workshop. Session topics include ‘Building Websites that Sell’ and ‘What is Social Media and How Do I Use It?’ You can also sign up for free 1-on-1 consultations with experts who will critique your website.

TV SHOW GENERATES VALUABLE EXPOSURE
Speaking of marketing, Chef Lynn Crawford really gave our region a boost with the broadcast of her new TV show, Pitchin' In, on Canada's Food Network, earlier this month. Aside from all the great PR for our lobster industry, the media time is worth $288,000 to our region, a figure well beyond our current marketing budgets.

STUDENT JOBS PROGRAM
The Federal government has announced the launch of Canada Summer Jobs 2010, which supports work experiences for students and helps provide important community services. Funding will be offered to not-for-profit, public-sector and small private-sector employers to create high-quality summer job opportunities for young people 15 to 30 years old who are full-time students and intend to return to school in the next school year. Here are the details.

Is Nova Scotia Running Out of Agricultural Land?
The short and long term future of the existing agricultural lands will be the subject of a province-wide consultation later this month. According to Canadian census figures, cleared farmland has declined steadily since at least 1901. There are only 181,915 hectares of active farmland left in Nova Scotia, with a large concentration here in the Annapolis Valley. A series of public meetings will take place to look at what the future holds for our agricultural resources.

GOING SOMEWHERE?
Winter driving is hazardous so please remember to check road conditions before getting behind the wheel. You can do this by viewing highway webcams or simply by calling 511. The province is, in fact, asking for your feedback on the 511 highway service info line … do you have suggestions for improvements?

Here’s something for those who would like to take part in the local arts scene: Secret Seeds, one of the region’s newest cultural endeavors, is an event built around a series of short plays. Organizers will be meeting on Saturday to discuss ideas … you are invited to share your expertise and enthusiasm!

Officials Were Warned About Wind Farm

(Source: The Daily Item)By Marcia Moore, The Daily Item, Sunbury, Pa.
Jan. 22--SUNBURY -- Two separate Northumberland County boards of commissioners were cautioned since 2006 by three legal advisers about "shortcomings" in a Sunbury firm's wind farm proposal.

At issue is the land-lease agreement between the county and Penn Wind, a 29-year deal that is in the midst of being renewed and has been in jeopardy for months.

The two sides are hoping to keep the project afloat and plan to meet early next week.

Commissioner Vinny Clausi, who has loudly voiced his displeasure with the financial details and discrepancy about the amount of land involved, and Commissioner Kurt Masser said they're optimistic about reaching an agreement.

Since 2007, the county has been leasing land in Coal and East Cameron townships to the company for $1 a year, with an agreement that the county would receive $56,000 a year once the site begins generating wind energy.

Late last week, Penn Wind CEO Justin Dunkelberger revealed the company's intention to sell the lease to an unidentified California company for $1 million and allow it to set up wind turbines on the land.

Masser said he was surprised to learn an outside company might be stepping in, but said he's willing to work with any business that's able to bring jobs and revenue to the county.

"I want to do what's right for the taxpayer," he said, agreeing that the county should reap more financially from the project.

Masser played down the impact of political contributions he received from Penn Wind representatives during the 2007 election, including $600 from James Garman and $500 from Chris Purdy, both of Sunbury, and $100 from Dunkelberger, of Northumberland.

"If I was pushing to get (the deal) done, it might be an issue," Masser said. "But I've been saying all along that we should put our concerns on the table and lay out what we want."

He said that will likely occur when commissioners return to the negotiating table with Penn Wind next week.

And, Masser said, "Unless everyone can agree to the terms, I won't vote for it."

Even before the first contract was signed in 2007, then-county solicitor Guy Schlesinger raised questions about whether the county would receive its fair share. The former board, headed by Samuel Deitrick, along with Masser and Frank Sawicki, went ahead with the contract to lease about 500 acres for $1 a year until a 23-acre site is developed.

In 2008, solicitor Hugh Jones wrote to the commissioners recommending the contract not be signed.

He cited "shortcomings" in the deal cited by former planning Director Steve Bartos, including the lack of provisions for giving the county a percentage of the wind energy revenue and failure to place a limit on how long Penn Wind can lease the property at $1 a year without developing the site.

Despite the concerns addressed by Jones, the current board -- Sawicki, Masser and Vinny Clausi -- signed the deal for another year.

Assistant solicitor Kymberley Best added her concerns about the project last week in a letter in which she described the contract as "disadvantageous" to the county.

On Friday, three days after Best's letter was written, the commissioners learned that Penn Wind planned to sell its lease and allow an outside company to develop the site.


Copyright (c) 2010, The Daily Item, Sunbury, Pa.

Distributed by McClatchy-Tribune Information Services.

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About Gaia

James Lovelock and Silver Donald Cameron

Father of the Gaia hypothesis
, IT's IMPORTANT for Gaia that
human beings survive," says
James Lovelock.
"Our intelligence, if it can be
integrated as part of the whole plane-
tary system, would make ours the first
intelligent planet in the galaxy, per-
haps. What a wonderful future for hu-
mans!"
A great scientist needs great courage
and a great imagination - and Jim
Lovelock has both, in spades.
It is now 40 years since he rattled the
scientific world and electrified the rest
of us by publishing Gaia: A New Look
at Life on Earth (1979), which argued
that the Earth behaves like a single
living organism that creates and main-
tains a viable environmentfor life.
The Gaia hypothesis - named for the
Greek Earth goddess - implied that
the world was far more complex than
modern reductionist science had imag-
ined. It offered a coherent vision of the
whole living world that echoed all our
wisdom traditions and renewed the
human sense of wonder.
Mainstream scientists were horri-
fied. Many still are. But Lovelock's bold
insights, and his continuing explora-
tion of their implications, became the
foundations of "Earth system science,"
the study of systems like the circulation
of the oceans, the maintenance of the
atmosphere and the relationships
among the earth's many systems.
Noted author Gwynne Dyer considers
Lovelock "the most important figure in
both the life sciences and the climate
sciences for the past half-century," and
compares his achievements to Dar-
win's.
Slight, cheerful and white-haired,
Lovelock is now 90 years old, though he
looks decades younger. He published a
new book last year, The Vanishing Face
of Gaia. He and his American-born wife
Sandy spend their summers in Devon,
England, and their winters in her home
town of st. Louis, Mo., where I came
calling one brilliant January morning.
Lovelock resembles a geologist in his
easy navigation of the vastness of deep
time, but he recalls the Enlightenment
sages in his assumption that science is
a single enterprise, artificially split
into disciplines. He has been self-em-
ployed as a freelance scientist and in-
strument-maker for 50 years, largely
because of "silly people who would say
to me, 'You can't do biology, you're a
chemist.' As ifl didn't have a brain."
Freedom from institutional politics
allowed him to indulge his preference

James Lovelock is the author of Gaia: A New Look at Life on Earth. (SILVER DONALD CAMERON)
C, where crocodiles lived and bred.
Lovelock thinks that's the kind of
world we're creating - and because of
our essentially tribal politics, our ef-
forts to avoid it will likely fail. Since a
less habitable Earth won't sustain a
global population of seven billion, pop-
ulations will crash. Human beings
should plan a "sustainable retreat" to
the Arctic region. Canadians should
prepare for hordes of people trying to
relocate to northern Canada.
Is this inevitable?
No, says Lovelock. Gaia is far more
complex than we understand, and we
do not even know the depth of our igno-
rance. A scientist can only say that this
nightmare scenario is probable. But we
should prepare for it now, while the
world is still a reasonably civilized
place.
The real horror would be if our spe-
cies survived, but its fmest achieve-
ments were lost - science, art, culture.
Lovelock believes we could be the
evolutionary ancestors of an intelli-
gent, post-tribal species that will serve
an aging Gaia as her consciousness.
This is a colossal vision of tragedy -
and redemption.
Lovelock smiles.
"Gaia needs us," he says. "What a
wonderful future for humans!"

SILVER DONAI.D CAMERON
for observation over computer model-
ling and permitted him to follow the
evidence fearlessly, wherever it led.
In 2007 he was "shocked" to learn
that the Intergovernmental Panel on
Climate Change had "reached a consen-
sus on a matter of science.'!
Science is about nature. Consensus is
about politics.
So where has the evidence led him
lately?
Sea level, Arctic ice cover and ocean
algae populations, he says, are the best
indicators of global warming - and
they all reveal that the earth is heating
up much faster than the panel's projec-
tions. Furthermore, the evidence from
the Earth's last hot period, 55 million
years ago, shows that global temper-
atures don't necessarily change slowly
and evenly; they can flip fairly quickly
to hotter or colder states.
On that earlier occasion, most ofthe
Earth became a scorching desert. Life
retreated to the shores of an Arctic
Ocean with surface temperature of 21
Visit Silver Donald Cameron's website at
www.silverdonaldcameron.ca

A Fall-Down or Lay-Down Zone

Wind turbines blown away; CCI Energy project denied by Planning Board

By Nancy White / nwhite@cnc.com

Fri Jan 22, 2010, 11:35 AM EST
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Cohasset -

Wind turbines may not have a future in Cohasset under the current zoning bylaw.

The Planning Board on Wednesday night once again denied CCI Energy’s wind turbine application.

Down the road, the current wording of the bylaw on setbacks will likely prohibit a turbine’s construction anywhere in town.

This time around it was not the technical aspects – the shadow flicker, the noise impacts, the visual impact, the ice throw – that derailed the twin turbine proposal sited off Route 3A. Rather, it was an issue that did not even come to light during the first round, eight-month-long, public hearing process last year.

According to Cohasset’s wind energy conversion facility bylaw there must be “laydown area” equal to the height, including the turbines’ blades, and that laydown area must not encroach on a residential district.

Recently it came to the attention of the applicant and the planning board that the Trustees of Reservations’ Whitney and Thayer Woods, one of the adjacent properties to the proposed siting for the turbines, is zoned “Residential C District.”

The laydown area largely falls on property zoned technology/business district, but part of both turbines’ laydown area falls on the Whitney and Thayer Woods property, which is currently utilized for open space.

“We spent so much time looking over the complicated portion of the application, we failed to look at the simplest – the setback issue,” said Planning Board member Stuart Ivimey, who was the sole vote against the project the first time around. “Under the application of the bylaw (this project) simply can’t be done.”

Planning board members used the words “embarrassing,” “unfortunate,” “conflicted” and “stuck” to describe where they were on Wednesday night.

The ultimate vote was 1-3, with three members voting against approval of the special permit application and one, member Clark Brewer, voting in favor. Planning Board member Jean Healey Dippold did not vote because she did not serve on the board during the entire course of the application.

The vote denies the project application, put forth by a private developer, Plymouth-based CCI-Energy, which proposed the installation of two 1.65-megawatt sized wind turbines sited off Route 3A on the Scituate Hill behind Graham Waste Services and Hingham Lumber. The towers are 462-feet (or 100-meters) in height, including the height of the blades.

The project has had a long and arduous history with vocal opposition from a group of neighbors and residents around town and over a dozen lengthy (and at times contentious) public hearings. The Planning Board effectively denied it in May. The application, which is the first under town’s wind energy conversion facility bylaw, has been on the Planning Board’s docket since September 2008, but returned to the planning board in early December due to a court ordered remand. Sufficient and material changes were made to the application since its denial and the planning board was ordered to re-consider the application in light of those changes.

The Planning Board, as chair Al Moore explained on Wednesday, is a “quasi-judicial board.”

“We look at the bylaws and act upon them,” Moore said. “When a bylaw passes that is somewhat unpopular, it puts us in a difficult position as we try to follow those rules and bylaws fairly.”

Moore congratulated the applicant on addressing all the technical aspects of the application, but ultimately felt the portion of the bylaw that addressed the setback could not be overlooked.

The Planning Board spent more than an hour deliberating. The deliberation took several twists and turns as members tried to reach a consensus. Several motions and amendments to those motions were proposed and discussed.

Notably, Brewer proposed approving one turbine, the one sited farther away from Route 3A. However, his motion failed to receive any support and a vote was not taken. The board did take a 3-1 vote to deny the special permit (Ivimey, Moore, and member Charles Samuelson voted in favor of denial; Brewer voted against). The vote could not constitute a denial because according to state statutes a super-majority, with at least four members agreeing to a motion to approve or deny, is necessary.

Moore also proposed a motion that would have approved the project contingent on the applicant seeking a variance from the Zoning Board of Appeals on the setback issue.

Eventually, Ivimey moved to approve the application for the sole purpose of bringing the proceedings to a close.

“There is no other motion that will bring this to a head, to a termination,” Ivimey said.

During the deliberation Samuelson noted the bigger picture evident in what came to be the ultimate denial of the project.

“The way the bylaw is written (not allowing a fall down zone in a residential district) prohibits wind turbines from being built in Cohasset,” Samuelson said. All the large swaths of land targeted as potential turbine sites are in, or abut, residential districts. “I would support the (Alternative Energy Committee) adding something in (the bylaw) to enable these types of facilities to be built.”

In an e-mail sent after Wednesday’s decision, CCI-Energy legal counsel Kenneth Ingber said the project became “an unintended casualty of that flawed language (in the bylaw).

“The Planning Board went out of its way to commend CCI Energy for fully and satisfactorily answering every concern raised in the initial denial of the application for a wind energy project on Scituate Hill,” Ingber said.

“CCI reaffirms that its proposed project exemplifies Cohasset's stated goal of encouraging wind energy and remains the single best project in the single best location in the town. It is in as remote a location as there is in Cohasset yet still will provide the Town of Cohasset the significant financial and green benefits of a good wind energy project.”

Ingber said the CCI Energy would re-evaluate the situation and determine the best way to proceed.

“CCI Energy remains committed to realizing a wind energy project that Cohasset overwhelmingly wants to see implemented,” Ingber said.

CPV and Skypower

CPV Canada Receives Court Approval to Purchase the Wind Portfolio of the Former SkyPower Corporation

Press Release Source: CPV Canada Development ULC On Tuesday January 19, 2010, 3:33 pm EST
TORONTO, Jan. 19 /CNW/ - CPV Canada Development ULC ("CPV") announced today that it has received approval from the Ontario Superior Court of Justice pursuant to the Companies Creditor Arrangement Act to complete its acquisition of the wind development portfolio of the wind energy company Interwind - which was formerly part of SkyPower's renewable generation and development business. Closing is anticipated to take place the week of February 8.

"We are delighted the court, creditors and Interwind management have accepted our offer as the best way to move forward Interwind's portfolio of renewable energy projects," said Sean Finnerty, CPV Sr. Vice President. "CPV is committed to growing our portfolio of renewable energy projects in Canada and help build a bridge to a sustainable energy future."

CPV Canada Development ULC, an affiliate of Competitive Power Ventures, Inc., is advancing a broad portfolio of wind and natural-gas generation projects across North America. Led by a blue chip management team and the financial backing of the investment fund Warburg Pincus, CPV is fast becoming a leader in the development of renewable energy.

For more information about the project and CPV please go to www.cpv.com.

About CPV

CPV is comprised of three main business lines: Wind Generation Development, Asset Management, and Thermal Generation Development.


(x) Wind Generation Development: CPV Renewable Energy Corp. currently has
6,100 MW of high quality wind generation projects under site control,
1,800 MW of which are in advanced development; including over 350 MWs
with executed long term PPAs.

(x) Asset and Energy Management: CPV currently manages the day-to-day
operation, maintenance and energy trading of over 4,400 MW of
generation in eight states to provide improved financial returns and
enhanced environmental protection to the owners and greater benefits
to the consumers.

(x) Thermal Generation Development: CPV is actively developing combined-
cycle and combustion turbine facilities totaling approximately 4,300
MW of generation, in markets with the greatest need for efficient,
reliable electricity capacity in the U.S. and Canada.
The acquisition of Interwind would be a further expansion of its presence in the Canadian market. CPV is currently developing a 400 MW natural gas-fired peaking facility in North Dumfries (near Cambridge), and a 1,200 MW combined cycle natural gas-fired project in the Nanticoke area (consistent with Canada and Ontario's efforts to reduce its electric generation carbon footprint by reducing the reliance on coal).

For further information

Braith Kelly, (860) 713-3309, bkelly@cpv.com

Posting Comments

Once again, your comments/posts are welcome. However they will neither be read nor posted if a full name and location aren't seen. Thanks. Kathleen Gidney Nova Scotia Canada