Green energy sector cheers Ontario election result
(Reuters) - Ontario's renewable energy industry breathed a sigh of relief on Friday and manufacturers looked forward to a surge in demand after voters in the province returned the Liberal Party to power, albeit without a majority.
Shares in renewable energy companies rose on expectations of an end to an industry slowdown caused by months of uncertainty over the future of the Liberal-sponsored green energy plan and its generous feed-in tariff (FIT) scheme for renewable power developers.
The opposition Progressive Conservative Party, which had been well ahead in the polls for much of the campaign, had threatened to abolish the FIT program, which pays well above-market rates to developers of green power. They argued it was causing electricity prices to rocket.
"It is a good day today. Customers were holding back with orders ahead of the outcome of the election... Now that there is relief, people will continue with their plans," said Paco Caudet, general manager of Siliken Canada, a unit of Spanish solar panel manufacturer Siliken.
Shares of Sustainable Energy Technologies, a manufacturer of solar inverters, jumped 11 percent on the TSX Venture Exchange. Solar panel technology maker Day4 Energy Inc rose nearly 7 percent.
The victory by the Ontario Liberals in Thursday's election was their third in a row, but they fell one seat short of a majority, meaning they will need support from opposition legislators to pass bills.
Although the possible fragility of a minority government could have some impact on the renewables industry, "people are comfortable that the fundamentals are in place," Robert Hornung, president of the Canadian Wind Energy Association, said in an interview.
Ontario has attracted more than C$20 billion ($19.5 billion) in renewable investment commitments since it launched its FIT program two years ago. The largest single commitment is a C$7 billion investment by South Korea's Samsung C&T, which the Conservatives threatened to scrap.
Thursday's election outcome "allows us just to continue forward on the time frame that we hoped rather than guessing at what is coming down the pike," said Mike Garland, chief executive of Pattern Energy, which is developing four wind projects in Ontario with Samsung.
(Reporting by Nicole Mordant in Vancouver; editing by Peter Galloway)