Canadian solar industry promotes solar energy strategies
There isn’t one collective association that represents all renewable energy interests.
Renewable energy operates in sectors such as biofuel, biomass, wind and solar, and each sector association is a self-promoter. Each develops goals and objectives that they believe represent themselves positively and uses a variety of means to ensure that its message is heard.
Each industry is interested in governments hearing its message.
Governments develop policies, and the industries want to influence those policies. This is called lobbying and is often viewed negatively, but it is a genuinely useful way in which governments can learn what things are important to an industry. It is a particularly fruitful discussion if an industry’s ideals and ideas align with the objectives of the government. But in any case, the industry association must make the effort to truly represent its membership.
The Canadian Solar Industries Association (CanSIA) represents the interest of its 650 members or sponsors, which include manufacturers, distributors, power companies, retailers and installers.
It has prepared a pre-federal budget brief that provides a succinct overview of proposed public policy surrounding the development of the solar industry in the near future. CanSIA argues that solar energy will be on par with conventional energy costs in a few decades, but assistance to the industry could be a great investment in the interim. It says the industry employed at least 8,000 people this year, which will increase to 35,000 by 2025. By then, solar technologies will be reducing annual greenhouse gas emissions by as much as 31 million tonnes, the equivalent of almost seven million cars.
CanSIA’s report made three recommendations on how to advance this contribution.
It asked Ottawa to establish a multi-year 30 percent investment tax credit (ITC) for solar energy technology. This would work like the popular Home Renovation Tax Credit, which resulted in increased spending on home renovations by $4.3 billion in one year. People would be able to use 30 percent of the capital cost of their solar installation to reduce their taxes. CanSIA said the increased expenditure and employment resulting from this move will more than offset the reduced tax revenue.
The United States has used a solar ITC since 2006, which has contributed to an annual increase in installations of more than 800 percent. In 2010, manufacturing quadrupled and the economy grew by more than 67 percent with a mere 2.8 percent increase in gross domestic product. ITCs have the benefit of not requiring direct public funding, as is the case with grants. The ITC reduces the initial investment cost when the solar system is installed and helps develop a long-term strong solar industry.
The federal government should introduce green bonds to support the adoption of solar energy technology for all Canadian households, small businesses and communities. A Nanos Research poll in 2008 found that more than four out of five Canadians would consider contributing to green bonds and more than 60 percent agreed that they would be prepared to invest at the low rate of return, comparable to Canada Savings Bond. Such bonds would allow the public to invest in secure funds, which would help develop and deploy renewable energy technologies in Canada. “Green bonds would exhibit the most profound market transformation for households, small businesses and communities (including northern, remote and First Nation communities) where demand and support for solar energy technology is highest and the financial barriers are most pronounced,” CanSIA said in its submission. The association argues that green bonds would make reasonably priced credit available to help adopt solar energy technologies, and that any cost to the government, including regulation and administration, would be offset many fold by the benefits generated through taxation of renewable energy infrastructure installations.
It cites Europe’s Climate Awareness Bond as having raised more than one billion euros and the Europe 2020 Projects bond as channeling billions from bond markets to public infrastructure. Ottawa should support and develop Canadian solar energy codes and standards. CanSIA suggests that in the same way as the country has developed the National Building Code, the National Energy Code for Buildings and the National Plumbing Code, there should be a regulatory framework to ensure the use of the best practices for solar energy development. The association concluded by suggesting that while solar energy technologies will inevitably become commonplace, adoption could be greatly improved with modest but strategic support.
It points to the deployment of solar energy technologies and services in Ontario, where there has been private sector investment of $2 billion and the creation of 8,200 jobs in 2011. Every industry believes that its message is important and each hopes that at least some of its ideas will find fertile ground in the cultivation of government policy, but only time will tell if CanSIA’s recommendations will yield results in the Canadian government’s plans for 2012 and beyond.