By Bob Moser, Americas correspondent

Dozens of offshore wind developers and their investors in the Canadian province of Ontario stand to lose millions of dollars - and may consider group legal action - following a government decision in February to halt new project applications and terminate those already in the pipeline. 

Industry players say they feel betrayed by officials that have offered little reason for putting the brakes on what was arguably the world's most anticipated freshwater offshore wind market. Some developers and environmentalists are questioning how much of the moratorium is tied to anti-windpower interests, in advance of Ontario's election in October.

“Look at the wind map for Ontario and by far the greatest potential is offshore, it's a huge potential actually,” said Theresa McClenaghan, executive director of the Canadian Environmental Law Association. “So if we want to talk about radically remaking our energy generation here, it is using offshore. I think there is a future still in sight, as long as government doesn't make some irreversible decision along the way.” 

Citing a need for further scientific research of wind turbines on freshwater lakes, Ontario's ministries of environment, energy, and natural resources each had a hand in the moratorium announced February 11. The province will revoke one contract with Windstream Energy for a 300 MW project in Lake Ontario, and four other applications will be terminated, with application securities returned to developers.

“It's clear from the work that has been done that offshore wind in freshwater is still in the early stages of development and more work needs to be done,” said Lindsay Davidson, spokeswoman for Ontario's Ministry of the Environment. “We are taking the time needed to do more research and study to make sure any future offshore projects are protective of the environment and human health.”

Possible two-year moratorium

Government will follow progress on a proposed offshore site in Lake Erie near Cleveland, Ohio, as well as the world's lone operational offshore project in Sweden. Chief among concerns is offshore wind's effect on the drinking water taken from Lake Ontario, Davidson noted. Ontario Energy Minister Brad Duguid has said he expects it may take two years to gather enough research to lift the new moratorium.

Anti-wind power groups, which include physicians and academics among residents living near onshore wind farms in Ontario, have complained of noise and light from turbines affecting their health. Ontario's Environmental Review Tribunal was the latest board to hear this testimony in February.

The government's return to uncertainty, following a previous moratorium from 2006 to 2008 to study offshore wind's impact, is what frustrates developers like John Kourtoff, CEO of Trillium Power Wind, a company built solely around the attractive feed-in tariff Ontario had established for offshore wind.   

“In 2008, officials said they'd done all their studies during that moratorium and it was now full-speed ahead (for development),” said Kourtoff, whose company had more than 100 small investors and more than CAD10 million (EUR7.4 million) invested in four Lake Ontario projects, totaling 3.4 GW of power.  

“They've called this a moratorium, but they are confiscating all sites registered any distance from shore, no matter how long they've been owned,” Kourtoff said. “These are small investors, hard-working people who have put in CAD50,000 or CAD100,000 they have saved, trying to build a better future for Ontario and hoping to see their investment appreciate. And the government comes in and wipes the slate clean, deciding to strip them of their financial freedom.”

Zoning required

Ontario formed its rules for land-based windpower around peer-reviewed science that standardized a 40-decibel noise limit and 550 metre setback, the strictest legislated setbacks in North America. Davidson said similar studies on noise will be sought out by the government for offshore turbines.

McClenaghan of CELA says a strong coalition of “anti-wind forces” led by “rich coastal property owners” is simply flexing its muscle during an election year, and believes top Ontario officials fear pushing the envelope. 

“I think whatever party is elected in (October) will be told we can meet our renewable commitments with what we have in hand,” McClenaghan said. “They won't see reason to go back and reopen what has become a real liability with local resistance to wind power.”  

Kourtoff may be more optimistic, and believes the key to soothing concerned residents and officials lies in setting formal zones between nearshore, midshore and deep offshore for turbine placement.  

“Lets not lump in all offshore development together. If there's a problem with nearshore sites, we should make a distinction like European nations have,” Kourtoff said. “Anything from five to 10 km offshore could be deemed [too close], but plans beyond that should be allowed to go through the regular process.”

Approached by industry peers to discuss group legal action, Kourtoff says he's preached patience thus far. But the window for Ontario government to “right a wrong” is closing, he added.

“If this isn't clarified in the next week or two, we'll have to go to the next stage. We have studies and proof showing this wasn't done for scientific reasons,” Kourtoff said. “Science has already been done here, there aren't good reasons (for a moratorium).

“We need government and the ministries to say this was unintentional, it went beyond what was intended, and here is how we're going to fix this.”

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Image caption: Sweden beat Ontario to fresh water wind development with the inauguration of Vindpark Vänern last May.