Government Of Ontario’s Decision To Cancel Renewable Energy Projects
Jul 16, 2018
On Friday, July 13 the Government of Ontario published a press release outlining the government’s cancellation of 758 renewable energy contracts with a total value of $790 million.
In our opinion, this action by the Ontario Government is misguided, politically motivated and will not result in the expected reduction of the electricity cost for consumers. It ignores the environmental benefits from clean, safe, locally-generated renewable energy and the many economic benefits including thousands of new jobs that have been created across Ontario. This unfortunate decision will have a negative impact not only on the renewable energy industry but on the hundreds of communities, First Nations groups, schools and municipalities that held many of these cancelled contract offers.
Below Is Some Important Information As To How This Affects SolarShare:
This decision does not affect our 48 operating solar projects or their FIT contracts.
All of the projects that the provincial government has cancelled were projects under pre-construction stages of development. Our 48 completed projects all have 20 year fully binding FIT contracts and are not affected by this announcement. We are budgeted to end up with a surplus of more than $6 million at the end of our FIT contracts and we don’t require any additional projects in order to remain viable.
This decision will not impact your investment(s) in SolarShare bonds.
Solar Bonds invest only in already-built and operating solar projects. From day one, this has been a policy that SolarShare has strictly adhered to in order to shield our bondholders from project development risk. As stated above, SolarShare’s 48 operating projects (and one going live shortly) are unaffected by this announcement.
SolarShare has made no investments yet into the 13 planned but now cancelled projects.
SolarShare relies on a private investor group, Community Power Capital (CPC) to finance the development of all of its projects and also assume all related development risks. As such, if there are any development costs to be written off, it will be at the expense of CPC, not SolarShare. We are disappointed at the cancellation of these 13 projects, but our budgets remain unchanged: we never budget for revenues from new projects until they are complete and generating electricity.
Will SolarShare be able to develop or acquire more solar projects?
There are a number of other types of opportunities to develop or acquire more solar projects in Ontario, and SolarShare is presently pursuing them. We will pass on news of such when any new opportunity is secured. Any future projects considered for acquisition by SolarShare would also not be affected by the government’s decision.
We will be following this issue closely in partnership with the solar industry via the Canadian Solar Industries Association (CanSIA) of which we are a member. We will provide you further updates should any other changes be made.
As always, thank you for your trust and confidence in us, and please feel free to call us at (416) 977-7363 or email firstname.lastname@example.org with any questions or concerns.