Ontario may have high electricity prices, due in part to massive renewable energy subsidies, but it hasn’t been a deal breaker so far in Chatham-Kent for development.
While one Southwestern Ontario company recently announced it is expanding elsewhere due to high electricity prices, the cost of power has yet to surface as a deal killer locally.
This from Stuart McFadden, acting director of economic development for the Municipality of Chatham-Kent.
“Have I ever spoken with a company that is looking at Chatham-Kent and decided not to come here because of hydro prices? No,” he said. “Has it been part of the discussion? Yes.”
Kingsville’s Mucci Farms recently announced it is expanding into Ohio due to this province’s high electricity costs.
McFadden said the reliability of Ontario electricity is a plus for business here, citing the case where a company based in Chatham also has an assembly line in a U.S. state where electricity is cheap, but unregulated.
“The problem they found that in the U.S., it wasn’t reliable. The infrastructure wasn’t robust. They were having brownouts,” he said.
That led to outages and assembly line shutdowns.
“It doesn’t matter how cheap it is, if I don’t have it when I need it, that’s a huge problem,” McFadden said. “We need a robust system that will provide clean, pure power to the walls of the companies so that their equipment operates properly. And I believe our system is more robust, and has the ability to give the customers the power they want.”
McFadden said another key element that comes up is the opportunity for establishing a co-generating plant, where a company can use natural gas to generate electricity for its operations, and also make use of the heat created in the combustion process.
He would like to see improved opportunities for businesses to develop co-generation plants.
“Can you imagine a scenario where you have three or four companies on the same road and collectively invested in a co-gen plant and all benefitting,” he asked. “Think of the reduction in greenhouse gas emissions.”
He said companies also discuss solar power opportunities for additional revenue or to lower the utility bill.
“Those are a lot of the things we’re talking about,” he said.
The partnership between Truly Green and GreenField Specialty Alcohol on Bloomfield Road attracts attention, McFadden said. Excess heat and carbon dioxide from GreenField is piped under the road to Truly Green, which in turn utilizes both in its growing cycles. In the process, which is still in development, both facilities will cut their carbon footprints, possibly by as much as 16,000 tonnes a year.
McFadden said companies have heard of this co-operative effort and wonder if there are options for their businesses as well.
And while electricity prices have not scared away business as of yet, McFadden said availability of natural gas has.
“We’ve lost business because of natural gas infrastructure,” he said. “We had a very large greenhouse operation take out options on 250 acres of land. But where they were looking just didn’t have the infrastructure. The cost to get natural gas there was just too cost prohibitive.”
At a time when the provincial government seems focused on renewable energy, McFadden would like to see improvements made in terms of natural gas.
“I keep hearing about our need to reduce natural gas usage and turn our thoughts towards more electricity in the future,” he said. “I’m of the opposite mindset. We need to expand natural gas throughout rural Ontario so people can take advantage of a less-costly resource and help businesses be more profitable.
Earlier this year, media reports on a provincial plan to combat climate change had the Wynne government phasing out natural gas use for home heating, and replacing it with electricity. According to the working document, the plan would require that all new homes built in Ontario in 2030 or later be heated without the use of fossil fuels.
Natural gas availability in rural Chatham-Kent would be attractive to greenhouse operations, and that potentially means more jobs and commercial taxes for the municipality. McFadden said several operations are in the discussion phases.
“Some are in the planning phase. We are working on a fairly significant project that would potentially open the door for a significant increase in the greenhouse industry in Chatham-Kent,” he said.
This is an industry sector that is seeing annual growth rates of between four and eight per cent, he added.
“We foresee it continuing to grow into the future. We want to get ourselves positioned to have the right infrastructure in place to allow this sector to continue to grow in Chatham-Kent,” he said. “We’re an agricultural community. It only makes sense.”
