COMMENTARIES

Government can’t rewrite the deal

OFA Commentary 2710  Click here for audio version

By Paul Wettlaufer, Director, Ontario Federation of Agriculture

Faced with a 27 per cent cut in price on a contract with the Ontario Government for the production of green energy, Ontario farmers question the management of the program and the intent of the government on green energy.

When the government announced its plans to promote and use green energy, farmers lined up to produce solar energy. Then, without warning, the government announced changes to the deal already signed.

Government developed a green energy incentive for ground mount solar and quoted a reasonable price, farmers penciled it out and signed up,  leading the way in Ontario's green energy revolution. 

For reasons that make no sense whatsoever, the government on July 2 announced it was withdrawing its offer and substituting a lower price. Thousands of hours of research, work with banks, work with contractors, is all for naught for approx 11,000 applicants.

The price was right and now its not. 

Not only is this a serious blow to farmers who were willing to make this investment but it could be the death knell for the green economy.

The Ontario Federation of Agriculture will be lobbying the province to ‘grandfather’ all applications submitted up to July 2 for the original quoted price.

Our members have made significant investments in solar infrastructure based on the deal they thought they had with the province.  A 27 per cent cut in the price paid for that energy will mean an unacceptable loss.

Honoring the price offered to the applicants who have already made significant investments can be the only accepted outcome.

This is not only devastating to farmers, it jeopardizes the futures of green energy manufacturers.

Cancelled projects will mean lost investment from farmers and loss of future sales of solar equipment.

With this change Ontario will lose millions of dollars in new manufacturing opportunities; lose hundreds of manufacturing jobs; municipalities will forego

millions of dollars in tax revenue; and once again Ontario’s rural economy suffers a "gut shot".

This has shaken the confidence of rural Ontario and investors everywhere.

What's the next rug that will be pulled out from under us on the green energy file?

The designers of the deal understood the economic benefits and spinoffs in jump starting the green economy. The ones trying to tear it down need to recognize the economic damage.

We will be calling on all OFA members to contact their MPPs. We will seek their support of our plan to grandfather the originally-stated rate into all applications submitted up to July 2, 2010.

Farmers have shown good faith and leadership with their involvement in the green energy industry. Now is not a good time for the government to start rewriting the deals.