Solar Trends in Canada Linking Demand to the Supply Chain Presented to the Canadian German Chamber of Industry and Commerce, Inc. David Eisenbud, Chair of the CanSIA Board February 18, 2010
Canadian Solar Industries Association (CanSIA) 2 National Trade Association - Represents over 400 + solar organizations throughout Canada - Represents firms active in Photovoltaic, Solar Thermal Water and Thermal Air segments of the market Mission and Strategic Objectives - Strengthen the Canadian solar industry; - Develop and expand solar markets; - Remove market barriers; - Strengthen labour force training and expertise; and, - Improve awareness and understanding of solar viability across Canada and internationally
Where we stand Canada s Energy Reality Energy / Electricity Governance Provincial jurisdiction Federal NO National Renewable Energy Plan Natural Resources Rich Oil & Gas remains a key economic driver Challenge to convert to renewable energy action Significant Nuclear Agenda Large uranium deposits + CANDU technology Electricity Cost Relatively inexpensive (i.e. Hydro) Energy Security NOT a concern 3
Solar Works in Canada! 4
Solar Can Help Meet the Challenge Solar is scalable and growing - Solar combined with other smart grid technologies can meet 100% peak load growth Solar can be complementary with Nuclear - 2000MW Nuclear plan = billions in construction cost; 10-15 years to in-service; payback over 40yrs - Transmission infrastructure required for nuclear capacity - Distributed technologies built incrementally, avoids over/under building Solar is predictable - Combined with demand response, solar is as predictable as a fossil fuel peaking plant - At higher penetrations, combined with storage/load control is 100% reliable Solar space is available - Multi-tiered approach brings value to otherwise underutilized assets Brownfields, airports, wastewater treatment facilities, public lands, parking lots, agricultural lands are excellent sites for solar parks Acres of new and existing rooftops in urban areas to meet local demand (in US over 2 billion sq. ft. of new roof installed annually*) 5
Solar Can Help Meet the Challenge Solar can help reduce need for distribution capacity investment to meet future peak growth - Ideal for installation right at customer s site in large urban areas i.e. behindthe-meter - Does not negatively impact environment/wildlife Solar works best when Canada needs it most - Summer Peaking capacity at maximum to meet summer demand - Distributed Power built incrementally, avoids over/under building Solar WILL create green jobs - Navigant Study 28 new jobs per MW 14 direct; 14 indirect - Job creation tends to be local Solar Project deployment requires a mature supply chain 6
A rising commitment to Canadian clean energy 1. Canadian Solar Industry Industry in transition From smaller scale to larger scale projects/players 2. US-Canada Clean Energy Dialogue Election of Obama (i.e. Renewable Energy platform) U.S. Energy Security (i.e. Canada viewed as domestic) Canada likely to follow US lead in Copenhagen 3. North American Cap & Trade System 4. Smart Grid Infrastructure Ontario Green Energy Act 5. Green Jobs for New Economy 6. Principal support for renewables eminates from provinces Ontario Green Energy Act, Solar BC 7
8 PHOTOVOLTAIC TRENDS
PV Global Supply/Demand Snapshot 9
Major Components (% of PV System) 10
Canada Solar PV Industry Growth 2009
12 SOLAR THERMAL TRENDS
Solar Thermal Industry Approx. 100% growth in 2008* Federal Incentives ended 2007 / reinstated 2008 Federal Residential Pilot Projects starting in 2009 * Preliminary findings from NRCan survey for 2008
Solar Thermal Hot Water 14
ST Adoption Rates Too low for Canada Germany Canada 15
Solar Thermal Incentives & Support Federal Incentives Residential Solar Water Heating Pilot Program ecoenergy Renewable Heat Program ecoenergy Home Retrofit Program Home Renovation Tax Credit (expires Feb, 2010) Provincial Incentives Matching Federal ecoenergy Renewable Heat and Home Retrofit Programs (Ont, BC, Sask, NS) Various rebates, etc. Additional Provincial Support Solar BC (100,000 Roofs Program) Ontario Solar Thermal Task Force Ontario Green Energy Act (100,000 Roofs Program)
Turning the corner...expanding Solar Markets
Doing Solar Business in Canada Strategic Location (Gateway to N.A.) Close proximity to more mature eastern U.S. solar markets (NJ, PA, MA, MD, NY, FL, NC) Transportation links to major N.A. markets (CA, Southwest US) Emerging silicon production Emerging thin film opportunities Low manufacturing input costs Qualified labour force Provincial funding support, market advantage AMIS, NGJF Green Energy Act Domestic Content Policy
National Perspective...Future Challenges National Renewable Energy Policy Tax Incentives? Loan Guarantees? Government Solar Procurement? National Climate Change Policy Renewable Portfolio Options? US-Canada Energy/Environmental Dialogue Getting Ontario FIT Program Right!! No start / stop and long-term program stability (investment certainty) Adequate transmission capacity allocation across industry providers Minimum project realization bureaucracy to maximize near-term economic benefits Solar Workforce Development Strategy 100% solar employment growth over next 3 years ST Product CSA Certification Balance costs and time against codes/standards/consumer protection
Ontario Challenges Going Forward Ongoing Stability and Longevity Sending the right signal to the marketplace Renewable Energy Approval Process Streamlined regulatory approval process Domestic Content Requirements Impacts International and non-ontario companies Poison pill for investors FIT Program: 50% Increase to 60% by Jan 2011 MicroFIT: 40% increase to 60% by Jan 2011 Agricultural Lands Restriction Remove unnecessary barriers to solar deployment Developing Industry Capacity
21 SUPPLY CHAIN OVERVIEW
Value Chain Cost Distribution Polysilicon Ingot Wafer Solar Cell Solar Panel System $/W Solar System Cost Allocation by Category (US-2006 figures) 50% 20% 30% 22
Solar Energy Value Chain Silicon Raw Materials Silicon Processing Implementation Polysilicon Ingot Wafer Solar Cell Solar Panel System $/W Heavy Manufacturing Engineered Material Handling Systems Custom Production Machinery Industrial Process Supplies Process Manufacturing Custom Production Machinery Lab and testing materials Semiconductor Supplies Glass Light Manufacturing Metal fabrication Electrical Systems Components Power System Design/Engineering Project Installation Miscellaneous Supplies & Services 23
Renewable Energy Jobs Impact: Germany: May 2008: 40,000 created in PV industry alone... Feed-in tariffs have made Germany a solar powerhouse that employs 40,000 people in the solar industry alone, and an estimated 140,000 jobs in renewable energy US: Obama Signs Economic Recovery Legislation; Solar Industry Poised to Create 110,000 Jobs over Next Two Years.solar energy provisions in this bill will help create 60,000 jobs in the solar industry in 2009 alone and a total of 110,000 over the next two years, Rhone Resch - SEIA. Canada: Green Energy Creates Jobs Proposed New Act Would Result in 50,000 New Jobs in three years. Premier Dalton McGuinty 24
Examples of Solar-related Green Jobs 1 Solar Power (Thermal) & Photovoltaic (PV) Systems Harnessing the power of the sun Solar Development and Manufacturing Solar Fabrication Technician Solar Lab Technician Solar Hot Water Heater Manufacturing Technician PV Fabrication and Testing Technician Solar Installation and Maintenance Solar Energy System Installer Solar and PV Installation Roofer Solar Residential Installation Electrician Solar Commercial Installation Electrician ICE Technician Instrumentation/Controls/Electrical System Solar Commercial Installation Engineering Technician Solar Electrical Foreman Solar Engineering, Design & Project Management Solar Energy Systems Design Solar Thermoelectric Plant Manager Solar Operations Engineer PV Solar Cell Designer Solar Energy Engineer PV Power Systems Engineer (Electrical) Solar Sales & Marketing Residential/Commercial Solar Sales Consultant More Information Available: Environmental Defense Fund 25
26 THANK YOU!