Ontario Gas Scandal Doppelgänger

On Monday, a NAFTA arbitration panel will start oral hearings in Toronto arising from a dispute between the Delaware-incorporated renewable power developer, Windstream Energy, and the Government of Canada (notice how awkward it is for the public to attend). At stake is Windstream’s claim for damages of $475 million plus interest and costs over an alleged breach of NAFTA obligations by the Ontario government. Windstream had a Feed-In Tariff (FIT) contract granted by the Ontario Power Authority in 2010 to develop a 300 megawatt, 130-turbine offshore wind project west of Wolfe Island, but says it was thwarted by the Ontario government prior to construction.

My main interest in the Windstream litigation is how it illuminates the chaos inside official Ontario’s administration of the province’s electricity future. The case also illustrates how international trade agreements can leave the federal government on the hook when provincial government engage in shenanigans, an important but previously known fact of life in our imperfect federation. (As if our provincial governments need more incitement for irresponsibility.)

(Three short appendices are included at the end of this piece, one briefly glancing at other litigation going on initiated by other unsuccessful wind developers, another noting what appears to be special treatment by the Ontario government for a Samsung solar project, and finally links to other coverage of the Windstream case.)


The litigant’s pleadings are linked here.

Connecting to the Gas Scandal

Represented by a team of lawyers from Torys LLP lead by John Terry, Windstream’s arguments draw heavily on evidence arising from the Ontario gas plant scandal. That event precipitated the exit of then Premier McGuinty from politics in 2012 and criminal charges against McGuinty’s former Chief of Staff and Deputy Chief of Staff. Their next court date is February 24. The government’s business decisions in the Windstream and gas plant cancellation and relocation cases arose contemporaneously in the period from 2010 through 2012.

In defending the NAFTA claim, the government has made legal arguments that much of the gas scandal evidence is privileged and inadmissible. I am unable to weight the strength of those arguments.

read more: Tom Adams, Feb 12 2016


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