Canada eyes renewable exports to U.S.

Canada Renewable Power Exports surged as hydroelectric and wind power capacity expanded, feeding U.S. demand amid cross-border electricity trade, carbon markets, renewable portfolio standards, and strong government incentives despite a recession slump.

Canadian utilities are rapidly investing in renewable power, despite slumping demand for electricity in their country. The goal: to capture a share of the growing market for export of green electricity to the United States.

Canada's domestic electricity demand was flat from 2004 through 2008, while its electricity exports to the United States jumped 70 percent, with most of that growth met by higher renewable power generation. Hydroelectric power grew 10 percent and wind power nearly tripled, while fossil fuel generation fell 10 percent.

The growth of Canada's green power exports, even as some warn Canada is falling behind the U.S. in clean energy policy, comes alongside the continued expansion of its much larger, more well-known export: petroleum, including heavy oil sands production responsible for high levels of greenhouse gas emissions.

With the growth of renewable exports, Canada could, amid rising global electricity market opportunities ahead, become the largest source of both dirty and clean power to the United States.

Canada's investment in renewables hasn't slowed this year, with Prairie renewables growth helping to sustain momentum, despite a 30 percent recession-related slump in the cross-border electricity trade during the first half of this year. Continued investment is being driven by strong government incentives for renewable power and the expectation of regulations favoring renewable power in the United States.

"Over the last 100 years, utilities have built their systems to meet the growth of demand," said Darcy Johnson, an electricity market analyst at the National Energy Board (NEB), reflecting the NEB on solar demand findings, Canada's federal energy regulator. "Now we're seeing them expand capacity beyond that because of all kinds of government mandates and incentives: renewable energy credits, carbon markets and evolving renewable portfolio standards."

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