Ontario’s green sector takes a hit

Brand-new Windsor solar manufacturer Siliken has laid off two shifts due to slow demand:

Just weeks after provincial cabinet ministers presided over the official opening of its new alternative energy plant in Windsor, Siliken Canada announced it has been “forced” to lay off two shifts. Richard Monk, production manager for the company, which makes solar panel modules, confirmed Thursday that up to 70 workers will be off the job for a week to a month “or even longer” Monday because of a slowdown in business.

Monk blamed the government’s slow pace in handling approvals to add renewable energy projects to the power grid for a fall-off in domestic business.

The company says slow approvals for new solar projects are largely the problem, but the government blames the opposition’s promise to axe the FiT program if it wins power this fall:

The Ontario Liberals say layoffs at a Windsor solar panel plant are just the first of many job losses the province will see under a Tory government.  Economic Development Minister Sandra Pupatello says Windsor’s Siliken Canada itself attributed the loss in part to PC Leader Tim Hudak’s stance on the province’s Green Energy Act. His plan to kill the plan’s feed-in-tariff program, she says, is sending a chill down the green energy investment business.

Pupatello thinks the chill is a bad thing. It’s not. The cost of the FiT program in Ontario is unsustainable, the ugly green math is here. Paying 64 cents for a solar kWh makes no sense when the spot rate is around 3-5 cents per kWh for traditionally generated energy. McGuinty built a house of cards, and Tim Hudak called him on it. The market knows Ontario’s subsidy gravy train is coming off the rails in October, and that, together with slow approvals and a utility uninterested in hooking renewables into its grid is a recipe for green energy disaster.

It’s better the disaster happens to the green sector than province-wide economic disaster caused by the cost of renewable energy. If the McGuinty FiT program continues unabated, the province will lose jobs in energy-intensive sectors like manufacturing as energy costs rise and firms close, retrench or relocate.

It’s hard for the workers at Siliken to lose their jobs, but for Ontario the cost of those jobs is too high.

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8 thoughts on “Ontario’s green sector takes a hit”

  1. Oh no, another rent-seeker failing to obtain the rent he seeks. My heart bleeds. Hopefully he’ll deploy his left-over capital into something useful, like drilling for gas or oil.

  2. The threat of a FiT wind-down is a lousy excuse for shutting down shifts at Siliken. We are constantly reminded by BIG SOLAR that Spain, Germany, Britain, the U.S. and especially China have rapidly growing demand for solar panels. Siliken should simply focus their efforts on export sales and compete head-to-head with German, Spanish, British and Chinese panel manufacturers in those countries.

    This is a win-win-win solution: it increases Canada’s finished goods exports and allows Canadian jobs to expand; avoids wasting cash on FiT’s; and effectively transfers needed FiT’s in foreign countries over to Canada through the high prices charged for the solar panels.

    I recommend concentrating initially on high utility cost, FiT-infested, RPS-infected nests such as California.

    🙂

  3. chris y
    July 9th, 2011 at 11:16 am
    “The threat of a FiT wind-down is a lousy excuse for shutting down shifts at Siliken. We are constantly reminded by BIG SOLAR that Spain, Germany, Britain, the U.S. and especially China have rapidly growing demand for solar panels. ”

    Well, then you’ve been sold a bridge. 80% of PV panels currently bought in Germany come FROM CHINA. German PV production is falling apart due to low priced Chinese exports; and well ok the Chinese use some of their own product (which they produce using German machinery) for some Communist Party Boss Grandezza. So what did these Siliken guys want? Compete against China AND Germany? Oh, did i mention that the few surviving German PV manufacturers have production lines in Malaysia?

    You could just as well try to establish the production of stuffed toys in Canada.

  4. The political left has one rule when determining success; The level of failure is not the issue. Their good intentions were what we are the rate them on. To Alan Simpson; The Left does economics in their own way. Tax and spend until it’s all gone then print more and more.

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