closed to work?  Ontario loses LG Chem plant.  Business groups blame Ford for canceling renewable energy contracts

closed to work? Ontario loses LG Chem plant. Business groups blame Ford for canceling renewable energy contracts

Business groups say the Ontario government’s decision to scrap hundreds of renewable energy projects early in Premier Doug Ford’s term may have cost the city of Windsor a major chemical plant and more than a thousand jobs.

In May, local business association Invest Windsor-Essex said the city was losing $2.5 billion from the plant of LG Chem, a Korean chemical company, because the area did not have the electrical capacity needed to host the facility.

The plant was to provide cathodes and other materials for the $5 billion LG Energy Solutions battery facility being built in Windsor.

It would also create 1,000 to 1,500 jobs in the region, Invest Windsor-Essex said, boosting the city’s economic growth and creating jobs in a region of southwestern Ontario that has faced job closures and layoffs.

According to Invest Windsor-Essex, LG Chem required up to 15 megawatts of power to begin construction of the 1.5 million square foot plant in 2024, But the county has decided that it will not have electricity by then.

Brent O’Connor, an energy consultant with Energy Development Partner, said Essex County could have had electricity to meet LG Chem’s energy needs by 2024 if the Ontario government had not canceled nearly 800 renewable energy projects, including two in the region, in year 2018.

O’Connor said many of the canceled energy contracts, all based in southwestern Ontario and part of previous large government renewable purchases (LRP) purchases, had the potential to offset the power supply shortfalls.

Many of these contracts would have already been completed had they not been canceled in 2018 and would have produced 188.4 megawatts of electricity, according to projections from the Independent Electricity Systems Operator (IESO), the Crown Company responsible for operating the electricity market in Ontario.

The Otter Creek Wind Farm, which was to develop 12 wind turbines north of Wallsberg as of spring 2019 before it was canceled, had a generating capacity of 50 megawatts.

The strong Breeze wind farm in Dutton-Dunwich, just south of London, was supposed to generate 57.5 megawatts of wind power.

“These contracts would likely have produced enough power to meet LG’s chemical demand,” O’Connor said.

“It appears that Doug Ford’s lack of foresight may have directly led to Windsor losing this multi-billion dollar investment.”

IESO predicts that electricity demand in southwestern Ontario will double over the next five years — the equivalent of adding a city the size of Brampton to the grid.

Over the next two decades, greenhouse gas (GHG) emissions from Ontario’s power grid are poised to rise more than 400 percent as the province operates dial-up on its untapped fleet of natural gas stations, according to the IESO.

Since these renewable energy projects have been canceled, the county currently has no other way to compensate for the shutdown of a major nuclear reactor at Pickering, which is responsible for 16 percent of power countywide.

In 2019, soon after renewable energy projects were scrapped, Assistant Secretary of Energy Bill Walker defended the government’s decisions, arguing that they were necessary to lower taxpayer costs and help shrink the county’s ballooning deficit.

Our government has been very clear that it will eliminate any non-essential contracts. “Ontario has an adequate supply of energy right now,” Walker told reporters at the time.

Ontario Department of Energy spokespersons did not respond to Starr’s request for comment.

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2022-05-26 09:18:38

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