Newfoundland and Labrador has officially opened bidding for wind energy projects on the island, but a major piece of the puzzle — what residents can expect in terms of benefits — has still not been made public.
Industry, Energy and Technology Minister Andrew Parsons admitted Wednesday, Dec. 14, a draft fiscal framework has been drawn up and did circulate among potential bidders, but says he wants to put finishing touches on it before releasing it publicly.
“I hope to have more on that in the coming weeks,” he told reporters.
“They’ve seen it, but nobody knows with certainty where we’re going to be, so they have a general idea. But, like anything, until it’s out there and official, I don’t think they want to be going out and doing the financing piece and looking for that without figuring out what this looks like.”
Parsons said he doubts any company will submit a bid before the new year, given that the closing date is March 3, 2023.
Lease, not purchase
The department issued a 30-page list of guidelines for companies that outlines what the government is looking for from companies and what they should expect during the assessment process.
Bids will be reviewed in an initial phase based on the company’s level of experience and financing arrangements, among other criteria.
A second phase of review begins in April for companies that pass Phase 1. That will look at any connection requirements to the provincial grid, Indigenous and community engagement, and potential benefits to the province.
An environmental assessment will not be required during the bidding process, but no project will receive a green light without one.
As well, companies will not be awarded Crown land, but will rather be given exclusive rights to develop on it, something Progressive Conservative Interim Leader David Brazil said he is glad to see.
“We’re glad that they’re going with a lease process rather than a purchase process,” Brazil told reporters after the news conference.
“That to me is in the best interest of the people of Newfoundland and Labrador.”
However, Brazil was disappointed the fiscal regime for royalties, taxes and community benefits is still under wraps.
“At the end of the day, it seems, again, like it’s rushed. Why didn’t you wait to put everything in play? It would have been beneficial, and open and transparent.”
Parsons seemed contradictory at times when asked about timeframes, saying the bidding and environmental process must be thorough, but also emphasizing that time was of the essence.
“This is an ambitious plan with an ambitious timeline,” he said in his opening comments.
He said he was transparent about lifting the wind project moratorium right from the beginning when the province’s green energy plan was unveiled a year ago.
“I think my quote at the time was sooner rather than later.”
Brazil said that’s worrisome.
“The minister said he has no idea when this will be up and running, yet we’re hearing from certain companies that they have a timeframe,” Brazil said. “They say they’re going to be up and running in 2025, so do they know something about the process being rushed or put through in a different manner than is being shared by the minister and this administration?”
West coast controversy
Parsons insisted opposition to wind proposals is only coming from one area, although he wouldn’t name the Port au Port Peninsula specifically.
“I’ve only had pushback in one particular area — I’ll say the west coast. I haven’t had any pushback at all from anywhere else. I’m not hearing a thing, actually.”
World Energy GH2, a company headed by Nova Scotia businessman John Risley, got a head start earlier in the year, unveiling a proposal that would plant 164 turbines on the Port au Port Peninsula, taking up more than 40 per cent of the land mass in the first phase of a wind-to-hydrogen operation.
Several residents formed a committee opposed to the plan, but Parsons said he has heard from people in the area who support wind energy without saying so publicly.
“I will point out that there’s a lot of very obviously loud questions and some people not interested at all. I’ve also had a lot of people who are not interested in being very vocal publicly who have reached out and said we are very interested in seeing this move forward.”
The minister emphasized there’s still plenty of time to engage on the subject, and that people have had legitimate questions.
“I’ve also heard some that are absolutely ridiculous and not based on any kind of semblance of reality,” he added.
The amount of land available for wind projects has been winnowed down considerably since a map distributed in October showed 3.8 million hectares of land nominated for 73 possible projects proposed by 31 companies.
Parsons said consultations involving dozens of government departments and agencies have narrowed approved land down to about 1.7 million hectares.
“We removed areas identified where development may be problematic or prohibited, such as endangered or sensitive wildlife habitat, protected areas and parks, protected and unprotected watersheds and supplies, mining finds of significance, active mining areas and active farming areas,” he said.
The new map also excludes part of the Port au Port Peninsula where turbines would have gone, but neither the minister nor department officials could explain why that specific area has been taken off the table.
There is a limestone mine in the area. As well, some residents have reported the water supply in the area has turned muddy since survey work was undertaken by World Energy GH2 earlier in the fall.
Some opponents to the project have told The Telegram they are only concerned about the scale of the plans, but others have been more dead set against any development at all.
“As far as World Energy GH2 is concerned, they will never be welcome on the peninsula,” Sheaves Cove resident Marilyn Rowe said in an email Wednesday.
When asked about the change in the land map, World Energy issued a one-sentence response: “We will adjust, as necessary, depending on the outcome of the Crown lands process.”
NDP energy critic Jordan Brown said he’s concerned opportunities for local workers will be compromised by an accelerated timeframe.
“We don’t know who’s going to build it. Where does the training come from? We don’t have an industry already here,” he said.
“Right now, there’s no colleges offering the technology courses to actually maintain, build and operate these facilities.”
Brown said the NDP’s proposed just-transition legislation would guarantee the province is ready for the change from fossil fuels to green energy.
However, Charlene Johnson told reporters many of those now working in the oil and gas sector will transition just fine.
“I was so pleased to see that the process isn’t just about the highest bidder,” said Johnson, CEO of Energy NL. “One of the key pieces of info we had is that there has to be a benefits plan or local content for our members, and what work that can be done in Newfoundland and Labrador should be done (here).”
Johnson said she hadn’t heard any word that proponents might want to reactivate the former fabrication facility at Bull Arm, but welcomed the idea.
“Bull Arm is certainly a gem that we have in our province, and I think there’s several ways that it could be used, but it remains to be seen.”
By Peter Jackson, Local Journalism Initiative Reporter
Original Published on Dec 14, 2022