Yesterday's Federal Budget has good news for Canada's wind energy

Yesterday's Federal Budget was good news for Canada's wind energy industry as CanWEA's efforts over the last 18 months to secure more Federal support for the wind energy industry were rewarded.

The Federal Budget met CanWEA's primary objectives with respect to the Wind Power Production Incentive (WPPI) program. Specifically:

* The WPPI target has been expanded to 4,000 MW

* The WPPI program was extended until April 1, 2010

* The incentive provided by WPPI will remain at 1 cent / kwh for the duration of the entire program

* $200 million dollars have been made available over the next 5 years to support this objective and $920 million over the next 15 years (the latter number includes $140 million that is currently unallocated from the initial 1,000 MW WPPI).

A number of program design details remain to be finalized and CanWEA will be intimately involved in those discussions.

CanWEA had also been arguing that wind developers should be able to access WPPI for wind turbines utilizing the Canadian Renewable Conservation Expense (CRCE). This did not happen. Instead, the Budget did the following:

* Accelerated the capital cost allowance (CCA) rate for wind turbine investments from 30% to 50%.

* This increased rate will apply to equipment acquired during the next seven years, at the end of which period the effectiveness of the measure will be reviewed.

* This measure will improve the after-tax return on investments in wind turbines.

CanWEA's Government Relations Committee will be meeting soon to consider new advocacy objectives in light of what transpired in the Budget. These may well include continued efforts around CRCE, ensuring that wind energy projects are eligible to participate in the yet to be designed greenhouse gas emissions trading system, and others. I will keep you informed of our advocacy priorities as they are defined.

But....yesterday was a good day for the wind energy industry and a victory for CanWEA.

Robert Hornung
President
Canadian Wind Energy Association
Suite 750, 130 Slater Street
Ottawa K1P 6E2
(p) 613 598 4658
(f) 613 594 8705
roberthornung@canwea.ca
www.canwea.ca


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