Wind Energy

Wind energy is a major source of electricity in Canada, with an installed capacity of more than 12,200 MW as of 2017. 10 projects were completed in 2017 alone, adding to a total of 295 wind farms across Canada. Wind power is a key factor for sustainable economic growth and development and helps reduce the carbon footprint. What is more, it is available, clean, and inexpensive to produce, powering more than 1 million residential homes across Canada.

Energy Sources in Canada

Tidal, hydro, and wind energy are used to generate electricity while thermal energy is used to produce heat. Solar energy, i.e. photovoltaics are used to generate both heat and electricity. Fuels, on the other hand, are produced from biomass, including oilseeds and grains, firewood, landfill gas, pulping liquor, and wood waste. Hydro energy is the main source of renewable energy (66.9 percent), followed by solid biomass (24.1 percent), and wind power (4.6 percent). Canada is the world’s 8th largest producer of wind energy (2 percent of the total production).

Facts and Figures

Wind farms are located across Canada, in provinces such as Newfoundland and Labrador, New Brunswick, British Columbia, Alberta, Nova Scotia, the Northwest Territories, Ontario, and elsewhere. Examples of projects include the Lundbreck Wind Farm, Cowley North, Spiddle Hill phase I, and Digby Neck Wind Farm. The total capacity varies from 0.15 MW to close to 300 MW. There are more than 6,400 grid-connected turbines across the country, producing energy for big markets such as Alberta, Quebec, and Ontario. In fact, Quebec, Ontario, and Alberta are also the major wind power generating provinces, followed by British Columbia and Nova Scotia. More than 97 percent of electricity supply on Prince Edward Island comes from wind power but only 0.3 percent in Yukon.

The largest farms in Canada are Lac Alfred I and II, the South Kent Wind Farm, Blackspring Ridge, and others. A total of 16 farms have a capacity of 150 MW or more. Usually farms are located in areas with optimum conditions such as the southern parts of Saskatchewan and Alberta, the northern part of Manitoba, and the West and East coast. Electricity produced from wind power is mainly used by rural communities and towns and communities located near wind farms. In fact, more than 100 communities in Canada use wind energy and benefit in different ways, including community benefit agreements, tax payments, land lease income, and others.

Siemens Limited, Vestas Canada, Acciona Wind Energy Canada, ENERCO, GE Renewable Energy, and Senvion Canada are the major turbine manufacturers that supply equipment for projects in Canada.

Future Developments

The largest producers of wind energy are China (35 percent), the U.S. (17 percent), and Germany (10 percent). The United Kingdom, India, Spain, and France have about the same capacity as Canada (2 – 6 percent). The good news is that between 2015 and 2016 or in just one year, Canada increased its capacity by 11 percent. What is more, about 65 percent of electricity used in Canada is generated from renewable sources, including hydro and other sources. The total generating capacity is expected to increase over the next 20 years. The largest wind power projects will be in Alberta, Quebec and Ontario, with a capacity between 624 MW and 1580 MW. By 2040, the total capacity is expected to reach 19,450 MW.

Best Places to Start a Wind Energy Business

Good places to start a wind farm include regions with sustained winds with minimal obstruction. Locations that allow high speed are best as the goal is to enhance power generation.

1. Benefits

The main benefit of wind energy is that it is renewable and free and helps minimize environmental pollution. What is more, it is a source of clean electricity and helps improve air and water quality. Wind energy is sustainable and cost-competitive which makes it a good domestic energy source.

2. Equipment

There are different types of wind turbines, including offshore turbines, turbines for high wind and low wind environments, equipment for class III winds, and others. The main types of turbines are vertical-axis and horizontal-axis and components include rotors and blades, tower, drive train, ground support equipment, cables, supports, and others. As a rule, small turbines (up to 50 kW) are used for water pumping and residential homes while large turbines (up to 750 kW) are used to power plants, large businesses, etc.

3. Developing a Business Plan

Developing a detailed business plan is an important step to secure affordable financing for your start-up. A good business plan includes personnel and marketing plan, strategic analysis, financial and company summary, and overview of products and services. It is important to include a list of projected start-up costs such as lease and vehicle deposits, opening supplies, security deposits, leasehold improvements, working capital, initial leasehold payments, and others. You may want to include sections such as competitive analysis, customer profile, industry analysis, and competitive outlook. You may also include a chart that shows your company organization, including operations staff such as facilities management and customer service and administrative staff, includinh marketing, sales, and accounting. Finally, it is important to list your expenses, including utilities and rent, vehicle, travel, and insurance costs, professional fees, marketing expenses, administrative costs, and payroll. You may include a cash estimate and sources of cash inflow such as asset sales, borrowing, equity investment, and cash from receivables and operations. Sources of cash outflow include dividends, purchase of assets, principal repayment, and others. To improve your chances of securing a low-cost loan, make sure you include your profit and loss statement and details such as your cash balance and net cash flow.

Funding Sources

Financing can be in the form of a loan, grant, government loan, subsidy, angel investing, or self-financing (see here). In Canada, there are subsidies for wind and solar energy and government financing for commercialization efforts and programs and research and development. One example of a government program is the ecoEnergy for Renewable Power program. The goal of the program is to facilitate and encourage electricity generation by using geothermal energy, photovoltaics, biomass, hydro power, and wind power. Two other sources are funding under the Canada Small Business Program, which targets small-sized businesses, and loans by local and large financial institutions (see here). Businesses applying under the program are required to offer a security in the form of equipment and immovable property. Guarantee documents may be required as well to cover costs such as disbursements, legal fees, taxes, interest payments, and others. A business loan from your local credit union or bank or a big Canadian bank is another option to look into. There is a host of business products to consider, for example, term and revolving loans, business overdrafts, commercial mortgages, leasing, business credit cards, and more.