Job losses signal troubled times for green energy industry
Closure of Ontario wind turbine plant expected as subsidies ended, says analyst
Siemens Canada is closing its wind-turbine plant here, slashing more than 340 jobs, shuttering one of the town’s largest employers and signalling trouble ahead in Ontario’s green energy industry.
The closing, announced by the company Tuesday, comes after weeks of nervous speculation and one day of public debate over the factory, which was locked to employees Sunday night.
Its 340 employees were called to a meeting with the company Tuesday.
“This was a very difficult decision that was taken only after assessing all the options,” said David Hickey, head of Siemens Gamesa Business in Canada.
“We have a great team of employees at the plant who have produced quality work for the last six years, and we sincerely appreciate their efforts.”
The closing raises new questions about the fallout from Ontario’s controversial green-energy policy. Siemens was one of four green-energy plants lured to Ontario under a controversial multibillion-dollar provincial deal with Korean industrial giant Samsung.
Energy analyst Tom Adams said Ontario’s green energy industry could be in for a rough ride if it doesn’t lay its hands on orders from outside Ontario, a market he said is saturated with wind and solar electricity brought online since the Liberal government plunged headlong into green energy in 2009.
“I think it was always pretty obvious that whatever jobs were going to arise from the Green Energy Act were all temporary or almost all temporary,” Adams said, referencing the provincial law that paved the way for big wind farms in Ontario under contracts paying energy giants more than consumers pay for power.
“Samsung had no history in renewable energy before they came to Ontario. They came only for the subsidies, and when the subsidies dry up, they’ll disappear as quick as they landed.”
Outside the factory Tuesday, one employee talked about the frustration felt by employees.
“There was quite a bit of anger in there because they shut the place down the other night and never really told anybody about it,” said Rick, who asked his last name not be published. “It was bang, everything was locked down.”
A four-year Siemens employee said workers who called the plant’s sick line during the weekend were told there was no production Monday and were to attend a morning meeting Tuesday at the town’s community centre.
“It was the joke around there that they were just going to lock the doors, but we didn’t think it was going to happen,” said the man, who did not want to give his name.
Ontario — where electricity prices have basically doubled over the last decade, and where the energy file has become hugely political heading into next year’s election — had started the process to contract for an additional 600 megawatts of wind energy, requiring construction of about a dozen new wind farms.
But amid rising criticism and reports that indicated Ontario will have enough generation capacity for at least a decade, the Liberal government suspended plans for new projects in September.
Projects already in development weren’t affected.
“Clearly, the Liberal government should be working to build and promote our manufacturing sector — not set up situations where we’re losing these jobs,” said MPP Peter Tabuns, the NDP energy critic.
“There seems to be a growing disinterest on the part of the Liberals to actually invest in green energy. I think that may well lock us out of where the rest of the world is going in terms of energy technology,” said the Toronto MPP.
The Canadian Wind Energy Association, an industry umbrella group, said the market remains healthy in Ontario, regardless of the news from Siemens.
Despite the province’s decision last fall to suspend new projects, there are orders to fill in Ontario and bids for projects in Alberta and Saskatchewan, said Brandy Giannetta, Can Wea’s Ontario regional director.
“The outlook is positive,” Giannetta said, declining to comment on the Siemens situation specifically.
In 2010, four plants to make parts for wind and energy farms were set up under the Samsung deal between the company and the province to generate power for Ontario and create manufacturing jobs in green energy.
The four plants were to create about 900 jobs.
In exchange, Ontario agreed to buy heavily subsidized power from Samsung wind and solar projects and guarantee the company space on the province’s crowded electricity transmission grid.
The Liberal government, sharply criticized over the cost of the agreement, later renegotiated it after the company missed some deadlines, slashing by more than one-third the nearly $10 billion in power it had agreed to buy and reduced to $5 billion from $7 billion Samsung’s investment commitment.
We have a great team of employees at the plant who have produced quality work for the last six years, and we sincerely appreciate their efforts. DAVID HICKEY, Head of Siemens Gamesa Business in Canada