Plans for the second commercial wind farm in Newfoundland and Labrador have hit a snag, due to the sale of its proponent, but Hydro remains optimistic the project will proceed.

The provincial government signed a commercial agreement in December with Ottawa-based Vector Wind Energy to develop a small-scale wind farm near Fermeuse, a Southern Shore community about 90 kilometres south of St. John's.

Newfoundland and Labrador Hydro is confident a small-scale wind farm will proceed on the Southern Shore.
(CBC)

The project was intended to start producing 24 megawatts of power — with the potential to supply electricity to about 5,500 households — by 2009.

However, just a week after the agreement was signed, Vector was sold to Calgary-based Canadian Hydro Developers, which is now in the process of selling the Fermeuse project to a separate company.

Jim Keating, vice-president of sales development with Newfoundland and Labrador Hydro, said that while the Crown corporation is not privy to any of the confidential talks, the wind project will proceed.

"[It is] a little frustrating in the sense that we were wanting to have these projects started as soon as possible," Keating told CBC News.

"But we need to let things take their course and be patient, and make sure we get the best value [out] of this project."

Sod was turned this summer on a separate wind project, in St. Lawrence, on the Burin Peninsula.

While construction on the Fermeuse project has yet to start, Keating said it is not a sign that the province's nascent wind industry has suffered a setback.

"The delay is strictly commercial. It has nothing to do with the wind resource," he said. "I'm optimistic, and I can't predict a date when we'll conclude, but I'm sure it will be in the very near future."

A confidential consultants' report prepared for Newfoundland and Labrador Hydro in 2005, which CBC News obtained this week, said the potential for wind energy on the island is excellent, although the power grid is "isolated and relatively weak."

The report, by Ontario-based Acres International, identified four locations on the island to develop small-scale wind projects, including St. Lawrence and Bay Bulls, which is near Fermeuse. The other locations were near Bonavista and at the Arches, on the Northern Peninsula.