Solar electricity, particularly grid-connected photovoltaic solar power, is a largely neglected resource in Canada, say proponents of the technology.
"In Canada, the solar electric market is pretty dismal," says Rob McMonagle, executive director of the Canadian Solar Industries Association (CanSIA).
CanSIA is a trade organization that represents 150 companies, ranging from industry-leading manufacturers to small mom-and-pop installers.
"Solar has tremendous potential, but we lag significantly behind what is happening in other parts of the world," he says. "Historically, the assumption was that Canada had plenty of energy and didn't need to look into future energy supplies."
|Photo courtesy of SPS Energy Solutions|
|PV array for a remote telecom system overlooks Desolation Sound north of Powell River, B.C.|
CanSIA estimates installed solar electric totals approximately 12 megawatts, of which only half a megawatt is connected to the power grid.
Most solar power is used in standalone, off-grid systems for remote cottages or for spot- power demands such as telecommunication towers.
Ontario has a total of about 30,000 megawatts of electricity generation capacity.
CanSIA also estimates that there are around 400 solar and related technology companies in Canada, employing approximately 1,000 people. The solar market totals $100 million in Canada annually.
By comparison, the global photovoltaic (PV) market represents a $3.5-billion industry. PV leaders such as Germany rely on solar power with an estimated installed capacity of 768 megawatts, the majority of which is grid connected.
The main reason solar is not more prevalent in Canada, McMonagle says, is a lack of government programs to support the initial deployment and to help reduce market-entry barriers.
"Solar is caught in a Catch- 22," he says. "Because there hasn't been a lot of support for solar in the past, the industry here is not at a significant capacity today to provide what governments want, which is to see significant power put on line in the next four to five years.
"The thing about solar is that you need to start building capacity now so that the industry can provide power generation in the future," McMonagle says.
Brian Young, senior policy adviser in the Ontario Ministry of Energy's conservation branch, says the high cost of solar makes it a hard sell.
"Our government has shown a keen interest in renewable energy through its five-per-cent commitment to renewables in the system by 2007," says Young, pointing to a recent ministry request for proposals (RFP) that netted 395 megawatts of renewable energy and the announcement of a new RFP in April for another 1,000 megawatts of renewable energy.
"Solar is welcomed to apply, but the price factor will make it difficult for solar to be part of the mix at the current time," Young says.
McMonagle admits solar electric power is expensive at approximately 40 to 50 cents per kilowatt-hour, compared with standard-grid electricity that hovers around five cents per kilowatt-hour.
Dr. Lisa Dignard-Bailey, program manager for Natural Resources Canada's Canmet Energy Technology Centre in Ottawa, says solar is expensive because the industry has not grown to the point at which economies of scale take effect.
"As the volume of production goes up, the price comes down, even without a technological breakthrough," she says. "That's not that different from the price curve of cellphones, computers or any high-tech manufactured product."
The cost of solar power decreases by five per cent a year on average and at the current cost projections, the estimated break-even point falls sometime between 2015 and 2020, Dignard-Bailey says.
Still, she says, solar will continue to have difficulty decreasing its price significantly until government helps spur the industry's growth.
"We can't do nothing for 15 years until solar becomes cost competitive. We need to build the experience and we need to support market-introduction initiatives."
To help break this financial deadlock, CanSIA announced the proposal of what is called standard offers contracts (SOC), also known as a feed-in tariff, in late May.
Under CanSIA's plan, home-owners would be credited at 42 cents per kilowatt-hour for the photovoltaic electricity they produce and feed into the utility power grid.
"A feed-in tariff (provides an incentive for) the individual to purchase a system and allows the necessary infrastructures such as trained installers, component manufacturers and knowledgeable safety inspectors to be put in place," McMonagle says.
"Once the system has been paid for, the utility has that electricity at no cost for the next 20 years of the system," he says.
Young says the provincial government is open to any plan that will speed the rate of adoption of renewable energy sources.
"It is safe to say that there is interest in standard offers contracts as a potential policy instrument inasmuch as there is interest in looking at all alternative procurement mechanisms to get things on the ground fast," he says.
Cost, however, is not the only barrier for solar electric power.
Technical and regulatory challenges - such as how solar electric connects to the grid, how to accurately measure the amount of power being returned to the grid and consensus on net metering standards - also limit the industry. (Net metering enables customers to use their own generation to turn their electric meters backward when they generate electricity in excess of their demand.)
While other technical issues remain, Young says the Ontario government will finalize a provincewide net-meter regulation by year's end. Hydro One currently allows net metering, but there are 93 different Ontario distribution companies without guidelines.
"Provincewide coverage will make it easier for consumers to demonstrate their commitment to the environment by buying those solar panels," Young says.
Another incentive for residential and commercial solar electric may be the government's push for provincewide adoption of smart metering, also known as time-of-day electricity pricing.
With smart metering, customers are charged different rates depending on the time of day the electricity is used. During high-demand periods customers pay more.
"Smart electricity pricing will bring photovoltaic to the break-even price point faster," says Dignard-Bailey. "If you have smart meters, homeowners or businesses are alerted to the real cost of generating electricity during peak load hours."
The final barrier may be one of education, although there are projects in the works that will demonstrate the potential of PV systems.
The largest is a $500,000 plan to turn the roof of the CNE's Horse Palace into Canada's largest photovoltaic power plant. By 2007, the project hopes to have two PV test systems, producing between 50 and 100 kilowatts of power, or enough for about 50 to 100 houses. In the future, the project will expand to between one and two megawatts.
It's projects such as the CNE's that give McMonagle hope for the future of his industry in Canada.
"While the current Canadian solar market is dismal, the potential and the future looks extremely sunny," McMonagle says. "We are at that point where we are going to have some examples of what can be done. Then people will see that solar is a viable way into the future."
(Mike McLeod can be reached at email@example.com)