If at first…

From the ashes of bankruptcy, a resurrected renewable energy developer returns to the County

Skypower is back.

Three years ago Skypower was on the verge of building the first large-scale wind energy project in the County—67 turbines stretching from Picton to Big Island. But in the fall of 2008 global financial markets collapsed, taking with them one of New York’s largest and most storied investment banks, Lehman Brothers. Lehman’s was Skypower’s largest investor and it wasn’t much later that Skypower was bankrupt and in the hands of a court-appointed receiver.

In a deal worked out with the courts in 2009, the principals of the failed wind energy developer found new backers in CIM Group, a Los Angeles-based private equity firm.

They then purchased the solar energy assets, including a large solar energy installation north of Napanee, as well as the name Skypower.

They left the old Skypower’s debts and obligations behind and started anew.

Now the new Skypower is back and proposing to build at least eight new large-scale solar energy factories in Prince Edward County—two in Sophiasburgh and six in Hallowell.

On Friday the province announced that it had awarded power purchase contracts for 40 new wind and solar energy projects. Thirteen of these projects have been awarded to Skypower. One of these, an 11.5 MW solar energy factory, is to be built on Chuckery Hill on the ridge just east of Picton.

In a statement Skypower’s President Kerry Adler said he was “pleased with the government’s continued commitment to clean renewable energy” and applauded the McGuinty government “for showing global leadership” in the pursuit of “the benefits of green energy.”

Prince Edward Hastings MPP Leona Dombrowsky says the 40 new projects build upon the 180 feed-in tariff (FIT) contracts her government has already awarded.

“These additional renewable energy projects will ensure that more jobs and investments are coming to communities across Ontario,” said Dombrowsky.

Nowhere in the statement does Dombrowsky mention the word “green” nor does it refer to her government’s Green Energy Act—legislation that has drawn fire for removing provincial safeguards and municipal oversight from developers’ paths.

The developers who received contract offers on Friday have been assured that they will gain access to the electricity transmission and distribution system in order to move the power they generate.

This is an assurance many smaller solar energy participants don’t have. As many as 1,000 microFIT investors (generating less than 10 kW) have been advised by Hydro One in recent weeks that it doesn’t have the capacity needed to connect their solar panels to the grid. Many of these have sunk up to $90,000 into these solar arrays but have no assurances when, of if, they will begin generating any income.

John Thompson is a farmer, landowner and former municipal councillor in Sophiasburgh. Thompson also has two microFIT solar arrays erected and supplying power on his farm. The old Skypower once held an option on part of his property. He has no relationship with the newly formed Skypower.

Thompson favours renewable energy and welcomes the Chuckery Hill plan—if it is on marginal agricultural land. Thompson defines marginal as land classified as level 4 and lower.

Thompson is worried about the mixed messages the province is sending to smaller developers.

“I am very concerned that many conditional offer-holders are left in limbo at the moment,” said Thompson. “At the time these microFITs were applied for, a conditional offer was defined as a go-ahead to invest. [Participants were advised to] apply for the connection when the project is nearing completion or complete.”

Thompson wants not to believe that these smaller microFIT investors have been bumped to accommodate the larger FIT developers such as Skypower.

“Although the optics of approving more FIT solar projects when a lot of microFIT is in limbo, could hardly have been worse,” said Thompson, “I am not convinced, however, that FIT contracts were a causal factor [in the delay in getting microFIT projects connected].”

Skypower’s Chuckery Hill and Rosseau Road solar project is currently specified at 11.5 megawatts—which, at about 10 acres per megawatt, implies a 110-acre project. It is not the first such project awarded in the County.

Similar scale solar projects along Huyck’s Point Road and two others in Ameliasburgh were awarded power purchase contracts last year.