Offshore wind energy leads to job creation and economic benefits for Ontario

The emergence of such an industry would add between $4.8 and $5.5 billion to Ontario’s economy during the 2013-2026 period, according to a Conference Board of Canada report assessing the potential contribution of offshore wind power generation to the province’s electricity supply, employment, and economic activity.

Ontario has made a long-term commitment to renewable electricity, in part to eliminate generation from coal-fired plants. The government’s Feed-in-Tariff (FIT) program has attracted the interest of the global wind power industry. Offshore wind power is one of the renewable generation sources permitted in the FIT program, which offers long-term contracts at guaranteed prices for qualifying projects.

"An offshore wind energy industry in Ontario – one that develops enough projects to be sustainable in the longer term – would create both short-term construction employment and permanent green jobs in the operations phase," said Len Coad, Director, Environment, Energy and Technology Policy, The Conference Board of Canada. "Should development progress as anticipated, it is likely that new industries will develop in the province to service the needs of the growing sector."

The study, which was financed by Vestas Offshore A/S, quantifies the combined direct, indirect, and induced economic effects on economic indicators, such as real gross domestic product (GDP), employment, income, and government revenues.

The analysis finds that, over the 2013 to 2026 period, the development of Ontario’s offshore wind industry would lead to a cumulative total of $10.044 billion in real capital investment and operations spending.

The contributions to GDP identified in the study are based on the share of local procurement, which is required to be a minimum of 50 per cent under the FIT program. In the base case scenario of 55 per cent being sourced locally, $4.8 billion is added to the Ontario economy; under a scenario where 63 per cent of inputs come from local procurement, $5.5 billion in real GDP is generated.

In its analysis, the Conference Board assumes that seven projects in Ontario would add 2,000 MW of offshore wind capacity by 2026 (which is 5.7 per cent of the total current generating capacity in Ontario of 35,000 MW). This would comprise about 20 per cent the renewable energy target announced in the Ontario government’s recently- announced Long Term Energy Plan; the plan calls for renewable capacity from wind, solar and bioenergy to rise from 1,657 MW this year to 10,700 MW in 2018.

The potential offshore wind projects identified by the Conference Board study would contribute 1014 MW of that growth in renewable capacity by 2018, plus an additional 986 MW in the longer term.

There are currently no offshore wind farms in operation or under construction in North America. Two major Ontario wind farm projects – both in Lake Ontario near Kingston – are progressing toward implementation, which together would add 714 MW of capacity.

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