Canada’s clean energy investments surge

By Justin Bull

April 10, 2014

Canada received $6.5 billion in clean energy investments in 2013, according to a new report released by the Pew Charitable Trusts. This represents a 45 percent increase from 2012 — the highest rate of growth in the Americas and the second-highest in the G20.

Outside of Canada, only two other nations – Japan and the United Kingdom – saw increases in clean energy investments in 2013. Other countries, notably the United States and Brazil, experienced large declines, with respective investment levels dropping by 55 percent and 9 percent during the same period.

Wind remained the biggest source of investment in Canada: $3.6 billion nationwide, for some 1.5 gigawatts of new wind capacity installed in 2013. Big investments in Ontario and Alberta led the way, with South Kent and Blackspring Ridge projects generating a combined 570 megawatts.

Solar attracted $2.5 billion in investments for 500MW of new power generation. This represents a doubling of 2012’s investment levels, and reflects the steady decline in the price of photovoltaic panels that helps make solar projects economically viable, even in the absence of supportive policies.

The report, titled "Who’s Winning the Clean Energy Race?" (full version available for download here) maintains that government policy is central to Canada’s clean energy future. At the federal level, the latest budget has expanded the clean energy generation equipment that qualifies for accelerated capital cost allowances.

But the report also suggests that it is provincial, not federal, policy that is the real driver of clean energy investments in Canada. Pending changes to the controversial Green Energy Act in Ontario were seen as perhaps the biggest motivator of investors. In that province, feed-in-tariffs – long-term contracts offered to renewable energy producers – are poised for reform. This motivated investors to speed-up project deployment in order to secure future incentives.