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An International Climate Forum

Multi-national cooperation with respect to climate change and clean energy is an idea that was recently embraced by Canada and the United States when both countries began the Clean Energy Dialogue.

The idea of an international collaborative approach to climate change is one that is supported not only by the President, the Prime Minister and Canada's Environment Minister, but as the writer blogged last week, the U.S. Energy Secretary, Steven Chu, as well.

President Obama has taken the idea of international cooperation one step further.

On March 28, the President announced the Major Economies Forum on Energy and Climate, with the group's first meeting set in Washington in April, followed by a summit in Italy in July. The leaders of 16 nations, as well as the Secretary-General of the UN have been invited to attend.

The White House commented that the purpose of the forum was to "help generate the political leadership necessary to achieve a successful outcome" at climate change negotiations in Copenhagen in December as well as establish "concrete initiatives and joint ventures that increase the supply of clean energy while cutting greenhouse gas emissions."

Participating nations include: Australia, Brazil, Canada, China, Denmark, the European Union, France, Germany, India, Indonesia, Italy, Japan, Korea, Mexico, Russia, South Africa, the United Kingdom, and the United States.

Canada's participation in the Clean Energy Dialogue and its inclusion in the Forum positions Canada as a leader in the area of international cooperation on climate change. We will be watching for further news of the Forum and for Canadian leaders' comments this week.

Clean Energy Dialogue Finds a Friend in Steven Chu

The Clean Energy Dialogue between Canada and the United States was begun in February after President Obama visited Ottawa. Shortly after the historic meeting, our Environment Minister, Jim Prentice, met with his U.S. counterparts and others in Washington, D.C. to discuss how to move the Clean Energy Dialogue forward.

In interviews this week, Steven Chu, the U.S. Secretary of Energy was asked whether there should be international collaboration on energy research.

Dr. Chu's responded that "there is no reason why [energy research] should be compartmentalized" and said that it was particularly true for carbon capture and storage technology. Dr. Chu also commented:

"If countries actively helped each other, they would also reap the home benefits of using less energy. So any area like that I think is where we should work very hard in a collaborative way - by very collaborative I mean share all intellectual property as much as possible. And in my meetings with counterparts in other countries, when we talk about this they say, yes, we should really do this".

The focus of the Clean Energy Dialogue is the expansion of clean energy research and the deployment of clean energy technology. Both Canada and the United States realize that in order to address climate change new energy technologies must be created. It is not the responsibility of one country to go about this alone. It seems Steven Chu would agree.

Sun set to shine on Kingston: Everbrite announces plans for $500 million facility

After months of negotiation, Everbrite Solar announced that it will build a $500 million ultra-high efficiency thin-film photovoltaic (PV) manufacturing facility in Kingston, Ontario. According to its press release, Everbrite Solar forecasts that the facility's annual production of thin-film modules will be capable of produce 150 MW of clean power. The plant could generate up to 1,200 direct and indirect jobs in a community whose manufacturing sector has contracted significantly in recent years.

The announcement has attracted significant media coverage, including articles in the Kingston Whig Standard, the Toronto Star, and the Globe and Mail. It is the latest in a series of proposed solar investments in Ontario, as discussed in a recent posting.

Everbrite Solar chose Kingston in part because of the potential for extensive research collaboration with Queen's University, particularly the Department of Mechanical and Materials Engineering. The Department has several professors working on solar technologies, including Joshua Pearce and Steve Harrison. As part of its overall investment, EverBrite Solar is prepared to build a $25 million experimental thin-film manufacturing facility for use by Queen's researchers, provided that a collaboration agreement can be reached. EverBrite Solar CEO Karl Scherre expects that "Queen's participation in Everbrite Solar's Kingston research and development community will ensure that the ultra-high efficiency thin-film modules produced by Everbrite will continue to improve and be best in class for quality, efficiency and production costs." According to the Toronto Star, Dr. Pearce describes the plan as "a dream come true."

Some commentators are drawing parallels with the relationship between ARISE Technologies Corporation and the University of Waterloo, although ARISE established its principal manufacturing facilities in Germany.

Kingston may be well positioned to become a renewable energy centre of excellence. Several green power related initiatives already call Kingston home, including Performance Plants Inc. (which is affiliated with Queen's and has partnered with Lafarge in nearby Bath on a project), Canadian Hydro Developers Wolfe Island Wind Farm, SWITCH's alternative energy cluster, and various participants in Innovation Park. Also PARTEQ Innovations, which helps commercialize Queen's research, was recently awarded $9.1 million from the federal government to establish a National Centre of Excellence for the development and commercialization of Green Chemistry technologies. A company like EverBright Solar could be Kingston's Research in Motion.

EverBrite Solar is a subsidiary of EverBrite Industries Ltd., a full service industrial and commercial electrical contractor located in Toronto, Canada. EverBrite Solar continues to work with several investment advisors to raise the capital required for the proposed plant.

Is There Weak Link in the Climate Change Chain?

The writer has been frequently blogging about the climate change initiatives which have been undertaken by President Obama since his inauguration in January. Since he took the Oath of Office, the President has been touting, among other climate change plans, the idea of a cap and trade system for governing GHG emissions. He has consistently defended critics of this system, some of whom have referred to it as a cap and tax system, as a necessary link in his climate change chain.

Is he backing down?

President Obama held a press conference yesterday which was nationally televised. During the Q&A after his remarks, one reported stated that the budget being written by Senate Democrats did not include either of middle class tax cuts or cap and trade system that was in the President's draft budget. The reporter questioned whether President Obama would sign a budget which did not include these two items. The President answered "we never expected, when we printed our budget, that they would simply Xerox it and vote on it". He further commented:

"When it comes to cap-and-trade, the broader principle is that we've got to move to a new energy era, and that means moving away from polluting energy sources towards cleaner energy sources. That is a potential engine for economic growth. I think cap-and-trade is the best way, from my perspective, to achieve some of those gains, because what it does is it starts pricing the pollution that's being sent into the atmosphere. The way it's structured has to take into account regional differences. It has to protect consumers from huge spikes in electricity prices. So there are a lot of technical issues that are going to have to be sorted through. Our point in the budget is: Let's get it started now. We can't wait. And my expectation is that the Energy committees or other relevant committees in both the House and the Senate are going to be moving forward to a strong energy package. It will be authorized. We'll get it done. And I will sign it".

Even if cap-and-trade isn't included?

Remarks by the Energy Secretary, Steven Chu, last week may confirm that cap-and-trade may put the U.S. at a disadvantage with its trading partners if other countries refuse to impose similar restrictions on their own manufacturers. Speaking before a House science panel, Mr. Chu confirmed "if other countries don't impose a cost on carbon, then we will be at a disadvantage". Mr. Chu went on to raise fears of U.S. protectionsim by proclaiming that his country "would look at considering perhaps duties to offset that cost".

We may continue to see climate change initiatives come from the White House; but will the most controversial plans, of which cap-and-trade is the biggest - be delayed or abandoned altogether? We'll see if these proposals are the weak links in the climate change chain.

Alberta Utilities Commission to consider need for $3.5 billion of transmission upgrades to support renewables

The Alberta Electric System Operator ("AESO") has filed an application with the Alberta Utilities Commission ("AUC") identifying a need for substantial transmission system reinforcement in southern Alberta. According to the notice of hearing issued by the AUC, the AESO submits that as much as $3.5 billion in system reinforcement ($1.8 billion in 2008 dollars) may be required to accommodate forecast wind-power generation growth and system constraints, in three stages, by 2017.

Through a public hearing, the AUC will determine whether the reinforcement is needed, and is in the public interest bearing in mind social, environmental and economic considerations. If the AESO's needs application is approved, transmission companies will be invited to submit facilities applications to the AUC for the construction of the necessary reinforcements.

This application follows on the heals of the AUC's approval of transmission system upgrades to service existing and future wind farms southwest of Calgary (see our posting here). The Alberta electricity sector therefore appears to be ramping up renewable generation capacity.

The AUC has established an April 7, 2009 deadline for initial comment from interested parties and scheduled a public hearing to begin June 22, 2009.

Alberta Utilities Commission approves 1,000 MW wind farm enabling transmission line

On March 10, 2009, the Alberta Utilities Commission ("AUC") approved a facilities application by AltaLink Management Ltd. to build an approximately 100-km, 240-kilovolt (kV) transmission line between Pincher Creek and Lethbridge, at an estimated cost of $133 million. The new line is intended primarily to carry power from new wind power projects southwest of Calgary. In a press release announcing the decision, Scott Thon, AltaLink President and Chief Executive Officer, said "Albertans are looking for cleaner electricity and this transmission line will help deliver wind-generated power to homes and businesses across Alberta."

Investment in enabling lines such as this one is seen to be critical to unlocking renewable generation potential in Alberta and in other provinces. However, some intervenors in the AUC proceeding question whether the 1,000 MW capacity of the new line will be sufficient to carry the power that is expected to be generated in and around Pincher Creek. For example, Heritage Wind Farm Development Inc. submitted that the line should be sized to carry 2,000 MW. The AUC found insufficient evidence of the need for a higher capacity line and instead relied to the recommendation of the Alberta Electric System Operator ("AESO"). The Alberta Energy and Utilities Board (the AUC's predecessor) had previously approved an AESO needs application based on a 1,000 MW capacity.

In its press release, the AUC highlighted its finding that "AltaLink's proposal was in the public interest, bearing in mind social, environmental and economic considerations, and met the need identified by the Alberta Electric System Operator" and its requirement for "AltaLink to follow a route, utilize certain types of towers, and to investigate consolidation of lines along a portion of the route to minimize the line's impact on landowners while respecting landowners' wishes."

US insurers must report on impact of climate change as of May 2010

Beginning May 1, 2010, insurers operating in the U.S. with annual premiums of $500 million or more will be required to complete an annual Insurer Climate Risk Disclosure Survey. The new regulation was recently adopted by the National Association of Insurance Commissioners ("NAIC"), a coalition of the insurance regulatory officials of the 50 US states. The NAIC said the new rules reflect a concern about "how climate change will impact the financial health of the insurance sector and the availability and affordability of insurance for consumers. This disclosure standard will give regulators the information we need to better understand these risks."

The NAIC describes the new reporting requirements as follows:

"The scope of issues covered by the new disclosure requirement is broad, reflecting the many ways in which climate change will impact the insurance industry. In addition to reporting on how they are altering their risk-management and catastrophe-risk modeling in light of the challenges posed by climate change, insurers will also need to report on steps they are taking to engage and educate policymakers and policyholders on the risks of climate change, as well as whether and how they are changing their investment strategies."

These new U.S. requirements may influence reporting standards in Canada, particularly for insurers that are reporting issuers subject to OSC Staff Notice 51-716 on Environmental Reporting, discussed here.

Green Energy Act update

The Ontario Legislature carried Bill 150, the Green Energy Act, at second reading on March 11 and ordered the bill referred to the Standing Committee on General Government. Check here for updates or track the progress of the bill online.

Bill 150 is posted for comment on Ontario's Environmental Registry (ERB Registry Number 010-6017). The deadline for submitting comments is this Thursday, March 28. Comments received before the deadline will be considered as part of the decision-making process by the Ministry of Energy and Infrastructure.

Ontario and its agencies will offer ongoing opportunities to comment on draft regulations. For example, see our recent posting regarding OPA consultations on the proposed feed-in tariff.

CO2 a Pollutant in the US?

The Obama Administration continues its almost weekly announcements in its crusade against climate change. On Monday, the Environmental Protection Agency sent the White House a proposed finding that Carbon Dioxide endangers human health. Making a finding that CO2 endangers human health is something that both John Podesta and Todd Stern have been advocating for years through the Centre for American Progress.

Why is this announcement important? Currently CO2 is not considered a pollutant. Despite that CO2 is a greenhouse gas which contributes to climate change, it has not been considered a danger to human health by the United States - until now. If the EPA's proposed finding is accepted by the White House Office of Management and Budget, it would pave the way for the EPA to use the Clean Air Act to control emissions of CO2. It would also raise pressure on Congress to establish a cap and trade system to regulate emissions.

This does not mean that CO2 is going to be regulated immediately or that the administration will finalize rules for the regulation of greenhouse gases in the near future - these types of rules and a system for governing emissions could take years. However, if the White House finds that CO2 is a danger to human health, it is another link in the President's climate change chain.

The writer has blogged that linking environment and climate change to the economy would serve to centralize power in the federal government in the United States. The possible regulation of CO2 under the Clean Air Act by the EPA, a federal agency, is further evidence of that.

The sun is shining on Ontario

The Green Energy Act, and the related Feed-in Tariffs proposed last week, are helping to make Ontario a hot destination for big solar developers. As reported in the Toronto Star, several players have very recently acquired big stakes in the province (or have indicated that they are considering doing so). Transactions of note include the following:

• First Solar's acquired a 2,000 MW project pipeline from OptiSolar, including 200 MW of projects in Ontario;
• Recurrent Energy's acquired a 350 MW pipeline from UPC Solar, including many Canadian projects;
• Nanosolar Inc. indicated to the Toronto Star that it is considering establishing an assembly plant for its thin-film solar modules in Ontario and may be planning Ontario solar farms with EDF Energies Nouvelles (which already has a big wind presence in Quebec and just did a turbine deal with SkyPower Corp.);
• SunEdison Canada has co-ventured with SkyPower Corp. on several projects (a 9 MW project in Lennox-Addington county, 10 MW project in Thunder Bay and a 9.2 MW project in Norfolk County), but would like to see an even higher tariff for ground-mounted solar
• Axio Power, formerly Greenlight, is also developing projects in Ontario.
• The Star reports that at least two other firms - one of them domestic - are planning to set up solar-cell manufacturing operations in Ontario.

While some of these deals pre-date the annoucement of the Green Energy Act, it is clear that the Act makes the province an even more attractive destination for solar investment dollars. As the CEO of Nanosolar told the Star, the proposed feed-in tariff "makes the market predictable and thus investible for the kinds of long-term, fundamental technology improvements and investments that will ultimately make solar a mainstream energy source."

Ontario launches $250 million Emerging Technologies Fund

On March 18, the Ontario Ministry of Research and Innovation announced the launch of a new Emerging Technologies Fund (the "Fund"). The Fund is intended to help emerging companies cross what the Toronto Star describes as the Valley of Death, the gap in financing that swallows many proven products before they can be commercialized. Companies "with a significant Ontario footprint" that have innovated in the clean technology, life sciences, digital media and information communication technology will be entitled to apply for funding.

The Fund does not provide grants. Rather it will match investments by venture capitalists and angel investors dollar-for-dollar on the same terms as the private sector investors. The Fund will therefore take an interest in the companies it funds. "The goal is for the fund to be self-sustaining through return on investment," according to a statement from Minister John Wilkinson, although he acknowledged that the Fund is also taking on the risk that some companies will fail.

As reported by the Star, venture capital funding for tech companies is very tight in Ontario, which has forced many entrepreneurs to look to the U.S. for financing. The economic downturn has made raising money anywhere that much more difficult. Many are hopeful that the half-billion dollars unlocked by the fund will help innovation flourish in Ontario.

The Fund appears to complement the federal government's Sustainable Development Technology Canada ("SDTC") funding program (see our recent posting about new SDTC funding). SDTC describes the innovation funding chain as having the following stages:

• fundamental research
• applied reserach
• technology development and demonstration (i.e., pilot to full scale demonstration)
• product commercialization and market development
• market entry

SDTC identified a huge funding gap at the technology and demonstration phase, which SDTC funding helps to address, and a smaller gap product commercialization and market development, which is underserviced by venture capitalists and angel investors. It remains to be seen whether the Fund will focus only on the commercialization phase gap or also help fill the demonstration phase gap.

The program details are still under development and are expected to be published by June.

CD Howe Institute questions cost effectiveness of biofuels subsidies

The CD Howe Institute recently released "Going Green for Less: Cost-Effective Alternative Energy Sources", a comparative analysis of federal and provincial greenhouse gas ("GHG") mitigation incentive programs (the "Report"). The Report concludes that the government is currently over-investing expensive liquid bio-fuels programs and is under-investing in most cost-effective programs renewable heat and power programs.

The Report analyzes programs for liquid biofuels, renewable power, and renewable heat. The life-cycle emissions mitigation potential of each is measured against the technology that they would most likely replace (e.g., emissions from bio-diesel were compared against those from conventional diesel). The financial incentive for each program is then normalized using the calculated emissions mitigation potential to give a dollar-per-tonne measure of cost effectiveness. The Report acknowledges that the calculations are subject to many assumptions.

The Report summarizes the results as follows:

"The lowest-cost government incentive programs identified are for renewable heat and power technologies such as wind power, solar air and hot water heating, and biomass pellet heating, as well as energy retrofitting strategies. For these programs, mitigation could be realized at $10-to-$60 of government subsidy per tonne of carbon dioxide equivalent (CO2e) offset.

In contrast, the most expensive government incentives were found to be liquid biofuels, which ranged from $295-to-$430/tonne of CO2e for ethanol and $122-to-$175/tonne of CO2e for biodiesel. The federal government's $4.5 billion ecoENERGY program has dedicated over half of the total budget towards liquid biofuels." [emphasis added]

Having concluded that the government has a tendency to place big bets on the wrong technology, the Report recommends a technology-neutral alternative to existing programs. It suggests setting a carbon emissions "bounty" of between $30-50 per tonne CO2e, payable to any technology that could demonstrate verifiable reductions. However, the Report acknowledges that universal price on carbon, such as that established by a carbon tax or cap-and-trade system, would be preferrable to an improved carbon subsidy.

SDTC Announces 2009 Funding Projects

Sustainable Development Technology Canada (SDTC) is a not-for-profit federal corporation which functions to promote the development of clean technologies in Canada. The SDTC operates two federal funds - the $550 million SD Tech Fund and the $500 million biofuels fund.

The SDTC has recently announced its first round of funding for 2009. The announcements reveal that the SDTC is allocating $53 million in funding to 16 clean technology projects. These projects span many sectors of the Canadian economy and include:

• A clean energy project that produces lignocellulosic ethanol while reducing the amount of energy typically required to produce ethanol under current production methods.
• A forestry project that converts forest waste into a usable bio-carbon for energy production.
• A pulp and paper project that creates a biolatex binder for the production of paperboard.
• An agricultural project using a nano-technology platform for the delivery of chemicals in food production.
• A building technology project that may potentially cut heating costs by 10%, while at the same time improving indoor air quality.

SDTC will continue to accept project applications for the first round of funding until April 22, 2009. The second round of funding will open on September 2, 2009.

With assistance from Mel Garbe

Ontario unveils feed-in tariff program promised under the Green Energy Act

On March 12, the Ontario Power Authority ("OPA") unveiled its proposal for Feed-in Tariff ("FIT") pricing. The FIT is a key feature of the Ontario Green Energy Act, which is currently working its way through the Ontario legislature (see our bulletin for details).

The proposed rates, reproduced below, vary by technology and project size. The prices are intended to cover capital, operating and maintenance costs while providing a reasonable rate of return on a 20-year investment. According to the OPA, the FIT prices were "developed based on experience here in Ontario and in other jurisdictions."

Proposed Feed-In Tariff Prices for Renewable Energy Projects in Ontario

Biomass
Any size: 12.2¢/kWh

Biogas
5 MW or less: 14.7¢/kWh
over 5 MW: 10.4¢/kWh

Waterpower
50 MW or less: 12.9¢/kWh
Community-base, 2 MW or less: 13.4¢/kWh

Landfill gas
5 MW or less: 11.1¢/kWh
over 5 MW: 10.3¢/kWh

Solar PV
Rooftop
10 kW or less: 80.2¢/kWh
10 to 100 kW: 71.3¢/kWh
100 to 500 kW: 63.5¢/kWh
over 500 kW: 53.9¢/kWh

Ground
10 MW or less: 44.3¢/kWh

Wind
Onshore, any size: 13.5¢/kWh
Offshore, any size: 19.0¢/kWh
Community, 10 MW or less: 14.4¢/kWh

(All but wind and solar may be subject to different peak and off-peak prices).

For comparison, natural gas plants are currently paid between 8.5-11¢/kWh; nuclear plants between 6-7¢/kWh; and hydro plants between 5.7-6.2¢/kWh.

The OPA will be holding a series of 8 weekly stakeholder consultation workshops from March 17 to May 5. The agenda for the first session, which will deal with the objectives of the FIT program, is already available.

The OPA will continue to post updates about the program in a new section of its website.

Ontario to host workshops on provincial requirements for renewable energy technologies: March 23, 25 and 26

The Ontario government is beginning stakeholder consultations that will inform the regulations to be written under the Green Energy Act. The first series of workshops is intended to bring together stakeholders from across Ontario to brainstorm and provide advice on potential provincial requirements for renewable energy projects. The Workshops will be held on Monday, March 23 and Wednesday, March 25 from at the North York Centre Library Auditorium and on Thursday, March 26 at the Fairview Library. All three workshops will run from 1pm to 5pm and will feature the same content. A registration form is available online.

Canadian Climate Change Themes

The Clean Energy Dialogue between Canada and the United States was sparked in February after the Prime Minister met with President Obama. The President's Climate Change advisor, Carole Browner, met with the Minister of Environment to discuss Canada's approach to climate change during those meetings. A couple of weeks later, Canadian Ministers, including the Minister of Environment, traveled to Washington to meet with their American Counterparts. Since then, Jim Prentice has been busy speaking about Canada's response to climate change. A number of themes are emerging from the Minister's remarks:

1. Environment Policies are Instruments of Economic Renewal and Security : The Minister confirmed in a speech to the Institute of Corporate Directors on March 6, that Canada's environmental approach is to "make our national environmental policies positive instruments of economic renew and of national development". Environment policy and energy policy are inexorably linked. Canada has a history of environmental stewardship and has a responsibility to maintain that what at the same time creating wealth and building industry. Maintaining environmental integrity while enhancing our North American energy security is going to be a priority for the Federal government. We will start to see more overlap between Energy policy and Environmental policy.

2. Canada/U.S. Co-operation on Climate Change: This is no surprise. Since the President's visit in February, both the Prime Minister and the Environment Minister have said that Canada and the U.S. need to work together closely to address climate change. Minister Prentice has confirmed that Canada and the U.S. must work closely to build a new carbon economy and to ensure that "our policy and regulatory frameworks are coherent and supportive" and has called the relationship with the United States crucial in the context of the transformation to clean energy. There are a number of subthemes:

(a) Cap and trade: In a speech on February 27, Minister Prentice confirmed that Canada has committed to pursue a North-America-wide cap and trade system and that we will "work closely with the new U.S. administration to build the North American low-carbon economy". He is optimistic that Canada and the United States will arrive at a workable solution that defines "common or similar carbon reduction targets, that creates similar mechanisms to allocation emissions and...provides for the trading of credits on a North American basis".

(b) Fuel efficiency: Minister Prentice told the CBC on March 1 that Canada is prepared to go in the same direction as the United States and that he supports one fuel efficiency standard for the two countries.

(c) New technologies: The Minister remarked that Canada and the United States have a strong and shared interest in promoting the development and deployment of clean energy technologies. The Clean Energy Dialogue will include discussions about Carbon Capture and Storage, an interconnected electricity grid, nuclear energy, wind, solar, hydro and other "more remote renewable sources of energy". Canada's action plan has Canada "on course to reduce domestic greenhouse gas emissions by 20% by 2020 and by 60 to 70% by 2050". In order to achieve these goals, Canada must invest in new technologies.

3. Canada Must be a Leader : Canada is one of the top ten energy consumers in the world. Our challenge is to "stand among the world's elite as a clean energy superpower" and to demonstrate that Canada is a user of clean energy. The Minister told his March 6 audience that the government is "committed to ensure that Canada is actively and constructively engaged in the [Clean Energy Dialogue]" and that it "intends to be a leader and a responsible partner in defining the way forward".

4. International Agreement : both the United States and Canada seem to be setting their sights on Copenhagen in December and both countries believe that in order for climate change policies to be effective domestically, international co-operation is required. Canada's climate change policy is "based on a clear desire to include all of the major emitters in the world". Major emitters would include China and India and other developing nations.

5. Climate Change is Everyone's Responsibility : Although the impetus for climate change has to come from government with active participation and engagement of industry, the responsibility extends to all citizens "from all walks of life". Canada's climate change strategy will involve "how we consume and conserve energy in our homes and in our offices". In his February 27 speech, Minister Prentice remarked:

Thirty years ago, drunk driving was tolerable. It's not anymore. Twenty years ago, it was acceptable to drive without a seatbelt. It's not anymore. Up until a few years ago, Canadians could smoke anywhere in public. They can't anymore. Attitudes shifted. Behaviours changed. The same needs to happen with the environment.

Watch for these themes to start emerging in other departments of the federal government. Climate change is one of the most important issues facing governments today. We'll keep you posted on new developments in Canada. Stay tuned.

BC Hydro announces Phase 2 Bioenergy Call for Power

On March 5, 2009, BC Hydro launched the second phase of its Bioenergy Call for Power. BC Hydro revealed that there will be two streams to the Phase 2 call:

"The first stream is a competitive call for larger-scale biomass projects. Any form of biomass will be eligible and it will include wood waste sourced from new forest tenure enabled through provincial legislation in May 2008. The target is to acquire 1,000 gigawatt-hours per year of energy through this stream.

The second stream will focus on innovative, community-level electricity supply solutions using biomass. Through a request for qualifications, BC Hydro will seek to identify at least two such projects that can provide cost-effective electricity for ratepayers, as well as other quantifiable, local benefits such as improved reliability."

Read the full press release here. See BC Hydro's Bioenergy Call for Power homepage for updates.

Interested bidders may want to check out BC Hydro's report on the Phase 1 call, which it recently filed in its LTAP proceeding before the BC Utilities Commission.

Green energy is the next hot intellectual property sector

As reported in the March issue of Lawyers Weekly, patent filing is a booming area of practice for many Canadian firms. In particular, Davis LLP lawyer Ken Cancellara predicts that there will be a rush to protect intellectual property in the alternative energy sector:

"The Internet isn't the only reason for the increased legal business related to patents. The market 'is stable as far as general industries are concerned, but it's growing and about to explode in another area,' noted Kenneth Cancellara, a partner with Davis LLP in Toronto.That explosion is being felt in the energy sector, and it is especially pronounced in the alternative energy field. 'You can't pick up a newspaper today without reading about biofuels,' said Cancellara.

'If I had a prediction to make,' he added, 'it will be that this area is as important as the pharmaceutical [sector] issues in the 1980s. In the next two to five years, protection of alternative energy sources will become absolutely essential to the survival of the sector.'"

The full text of the article is available here.

And the Clean Energy Dialogue Begins

Our Environment Minister took a trip to Washington to meet with U.S. legislators and to promote the Clean Energy Dialogue this week.

On Monday Minister Prentice met with Senator John Kerry, who is the head of the Senate foreign relations committee. On Tuesday, the Minister met with Energy Secretary Steven Chu, Todd Stern, the special envoy on climate change and Lisa Jackson, the new head of the Environmental Protection Agency.

The Minister's discussions this week in Washington focused on the "expansion of clean energy research and the deployment of clean energy technology".

The Canadian press seemed to expect that the discussions would focus on Alberta's oilsands and not research and technology and the Clean Energy Dialogue. However, the Minister confirmed that the oilsands came up only "tangentially" in his discussions with the American legislators, including with Henry Waxman, the new chairman of the house energy and commerce committee and an ardent environmentalist.

Canada is the largest supplier of energy to the United States. Emissions from the oilsands, which are the subject of some "high minded hypocrisy" this month, are 50-70 times less than the aggregate of the emissions from coal plants in the United States.

America's challenge is clean coal; Canada's may be clean oil. But given that the oilsands were not, by the Minister's account, the focus of his discussions with legislators in Washington, perhaps both Canada and the U.S. recognize that neither country is going to gain any ground by pointing fingers. The right approach is to meet these challenges by looking forward and finding solutions in research and the development of new clean technologies. Isn't that what the Clean Energy Dialogue is for?

Stern offers qualified optimism about quick passage of climate change legislation

Passing climate-change legislation before December would be "an extremely tall order." This was Todd Stern's caution to international government officials gathered at a climate change conference in Washington this week. Nevertheless, Stern added that "nothing would give a more powerful signal to other countries than to see a significant, major, mandatory plan" from the U.S.

Stern (who has been the topic of previous postings) is the Department of State's Special Envoy for Climate. His comments reflect a tension that the Obama administration will have to balance in the coming months. On the one hand, President Obama has committed to moving quickly on the climate change file. The administration also wants to assert U.S. leadership in the international negotiation of a post-Kyoto regime. Specifically, Stern acknowledged that enacting domestic legislation before the negotiations in Copenhagen in December would sent "a powerful signal" to other countries to reduce their emissions (although Stern also said of the Bali roadmap targets, "it's not possible to get that kind of number"). On the other hand, the administration faces significant obstacles to passing legislation by December. The government is already tackling a financial crisis. It may also face strong opposition from representatives (including Democrats) from coal-rich and manufacturing-dependent states. See this article in the Wall Street Journal for more information.

Hopefully the need for expediency will prevail. In recent months, Canada has taken steps to align itself with the new administration on the climate change issue. It would be unfortunate if Canada too went another year without finalizing its plan to reduce emissions.

Google Earth now maps U.S. carbon dioxide emissions

A new high-resolution, interactive map of U.S. carbon dioxide emissions from fossil fuels is now available on Google Earth. The new mapping layer was produced by Project Vulcan, a research initiative led by scientist at Purdue University. Project leader Kevin Gurney hopes that the tool "will bring emissions information into everyone's living room as a recognizable, accessible online experience" (see Purdue news release of February 19, 2009).

The Vulcan layer on Google Earth shows carbon dioxide emissions in metric tons at the state level, county level and per capita. It also breaks down emissions by the different sectors responsible for the emissions, including aircraft, commercial, electricity production, industrial, residential and transport.

While the Vulcan layer currently only shows U.S. fossil fuel-related data from 2002, Project Vulcan reports that "work is underway to complete similar inventories for Canada and Mexico, to include CO and NOx emissions, quantification of all years from 1980 to the present, and incorporate biotic-based fuels." Project Vulcan has been running for 3 years and is primarily funded by NASA and the U.S. Department of Energy.

The project's data was expected to complement data collected by NASA's Orbiting Carbon Observatory, which was to measure levels of atmospheric carbon dioxide from space. However, that $278 million satellite crashed shortly after launch on February 24. It is unclear what effect, if any, the crash will have on the future of Project Vulcan.

CCME invites comments on extended producer responsibility discussion paper

The Canadian Council of the Ministers of the Environment's Extended Producer Responsibility Task Group (the "CCME Task Group") recently released a discussion paper regarding the design of Canada-wide extended producer responsibility ("EPR") regimes (the "Discussion Paper"). The release of the Discussion Paper is another milestone in CCME's initiative to produce a Canada-wide Action Plan ("CAP"), which would require that EPR regulations be implemented across the country. Such regulations would have a material impact on many suppliers and would hopefully produce meaningful reductions in waste and associated greenhouse gas emissions.

EPR described an environmental policy approach in which a producer's responsibility for a product is extended to the post-consumer stage of a product's life cycle. Ontario residents will be familiar with the Beer Store's bottle return program. With a 95% recovery rate for the industry standard beer bottle, this is an example of a very successful EPR program. EPR programs are intended to shift responsibility for managing waste upstream towards the producers of products and to encourage those producers to change their product designs accordingly.

EPR programs can significantly reduce greenhouse gas ("GHG") emissions, both by diverting waste from landfills (where it would rot and release methane) and by changing the way in which products are designed (for example by reducing packaging and the emissions associated with producing it). As mentioned below, the CCME Task Group have acknowledged that EPR programs can affect climate change by including GHG reductions as a potential key performance indicator.

The Discussion Paper describes a plan in two phases. Phase 1 would establish EPR programs for the following products and materials within six years of the adoption of the CAP:

• Packaging;
• Printed materials;
• Compact fluorescents and other lamps containing mercury;
• Electronics and electrical products;
• Household hazardous and special wastes; and
• Automotive products.

Phase 2 would establish programs for the following products and materials within 8 years of the adoption of the CAP:

• Construction and Demolition materials;
• Furniture;
• Textiles and carpet; and
• Appliances, including ozone-depleting substances.

The Discussion Paper also proposes several key performance indicators that could be used to measure and report on the effectiveness of the EPR programs, including the following:

• Kilograms/capita captured or recovered;
• Dollars/Kilogram captured or recovered;
• Per cent captured;
• Per cent recovered; and
• Avoided GHG emissions.

As indicated above, the CCME Task Group recognizes that its EPR vision will not be implemented for years. However, it continues to forge ahead in developing the CAP. To that end, the CCME Task Group invites the public to comment on the discussion paper up to May 29, 2009 using an online form.