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Article, ILSR Press Room filed under Energy, Energy Self-Reliant States

American States Can Learn Much From Ontario’s “Buy Local” Clean Energy Strategy

| Written by John Farrell | No Comments | Updated on Jan 10, 2011 The content that follows was originally published on the Institute for Local Self-Reliance website at http://ilsr.org/american-states-can-learn-much-ontarios-buy-local-clean-energy-strategy/
ontario turbine.jpg

The Canadian province of Ontario has launched a clean energy strategy to maximize economic development while reducing pollution.  Maximizing Jobs From Clean Energy: Ontario’s ‘Buy Local’ Policy, a new report from the Institute for Local Self-Reliance, details how Ontario’s bold clean energy program – in just over a year – has resulted in the promise of 43,000 clean energy jobs in support of 5,000 MW of clean energy projects. 

The centerpiece of Ontario’s program is a long term contract for renewable energy developers with a guaranteed return on investment.  To qualify for a contract, developers must source 60 percent of their project’s value from inside the province.

“The rule effectively means that no solar or wind project built in Ontario can obtain a contract without having some components manufactured locally,” notes John Farrell, ILSR Senior Researcher and report author.

This domestic content or “buy local” rule has spurred a fast-growing renewable energy industry in the province, with over 20 new manufacturing plants proposed and scheduled to open in the next two years. 

“The buy local provision in Ontario creates a simple, comprehensive economic development strategy for renewable energy that is in stark contrast with the complexity of clean energy programs and incentives utilized in the United States,” observes Farrell.

ILSR’s report estimates a cost per job created of $143,000 for the Ontario program, a cost comparable to or below non-energy related job subsidy programs in the United States and significantly less than some recent clean energy job creation efforts.  

“A U.S. state adopting the Ontario strategy would almost certainly see a much lower job creation costs than what’s estimated for Ontario because of our stronger renewable energy resources and higher electricity prices,” remarks Farrell.  “For example, Colorado’s solar resource alone would allow it to provide solar developers a similar return on investment at a 33% lower price for power and its higher retail electricity price would further reduce the marginal costs of the program and the resulting jobs.”

The full report from ILSR – Maximizing Jobs From Clean Energy: Ontario’s ‘Buy Local’ Policy – is available on ILSR’s New Rules Project website, www.newrules.org.  For more information, contact author John Farrell at jfarrell@ilsr.org or 612-276-3456. 

 

Photo credit: Journal of Commerce

 

About John Farrell

John Farrell directs the Energy Self-Reliant States and Communities program at the Institute for Local Self-Reliance and he focuses on energy policy developments that best expand the benefits of local ownership and dispersed generation of renewable energy. More

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