January 14, 2010

Power generation

Construction set to begin on solar farm in Sault Ste. Marie, Ontario

First stage of 40-megawatt project reaches financial close

ELAINE DELLA-MATTIA

correspondent

Sault Ste. Marie

Construction will begin this spring on a $100-million solar farm that is expected to be the largest in Canada and one of the largest in North America.

It’s expected the first phase of the solar farm will be completed and operational by the end of summer.

Job numbers or local contractors to be used for the project have not yet been determined but it is expected that some of the labour and materials will be provided locally. Rick Thomas, manager of the Sault Ste. Marie Construction Association, said the local industry is fairly busy but should have no problem staffing the project.

“I think this project will come very quickly while others on the book will stretch out a bit longer,” he said.

Despite the dollar value of the project, Thomas said it’s not complicated construction, comprising concrete formwork, steel erection, electrical installation and crane operation.

“This is a key renewable energy project that adds to our community’s base and provides an opportunity to train people for more jobs,” he said.

The city’s construction values for 2009 are at their third-highest level in a decade, largely due to simulus funding of large projects.

The first phase of the solar project will consist of two, 10-megawatt farms.

The project is now fully financed and can move ahead after almost three years of preparation.

“This is a financial close,” said Brad Nordholm, CEO of financing group Starwood Energy Group Global.

“All the major contracts have been signed and committed and the debt financing is also finalized. Bluntly stated, it means there is no turning back”.

The second phase of the project, a further 40 megawatts, is considered “under development” with an announcement possible later this year.

The solar project has taken some time to reach fruition, which is not unusual for a project of this magnitude, said Pod Generating president and CEO Glen Martin. Due to world market conditions and the complicated partnerships involved, the project was divided up into the two phases. Ultimately, Pod Generating Group was awarded a 20-year power purchase agreement of 60 MW by the Ontario Liberal government under the Renewable Energy Standard Offer program.

Starwood Energy is providing the equity financing after acquiring the project from Pod Generating. Q-Cells International, a global company that specializes in photovoltaic systems, has been contracted to lead the construction and equipment portion of the project and provide ongoing operations and maintenance service.

Norddeutsche Landesbank (Nord/LB) of Germany will provide the debt financing.

The collected solar power will connect to the local electrical distribution system.

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