February 24, 2009
In her commentary, Valerie Helbronner says that the Ontario Green Energy and Green Economy Act (GEA) signals the McGuinty government's seriousness—similarly to the Obama administration's—about injecting green initiatives into a waning economy.
The GEA provides strong incentives for renewable energy projects and promises to reduce the red tape that has been a significant impediment to development. But will the new Act achieve its goals? Only if the government can resolve some key issues in the next few months, says Valerie. For example, today's tough credit environment poses a significant challenge. The GEA's proposed feed-in tariff—a program for renewable energy projects that guarantees a fixed price for the electricity supplied by these projects—will need to do more than make projects economically viable for developers. The tariff will need to be high enough to ensure an attractive return on investment for equity investors and lenders.
Read Valerie's full commentary here (PDF).