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U.S. wind power firm awarded $28M after NAFTA challenge

A trade tribunal has awarded a U.S. firm about $28 million following Ontario's decision five years ago to put a moratorium on offshore wind power development.
Ontario halted offshore wind power development in early 2011, prompting Windstream Energy to file a claim under NAFTA.

A trade tribunal has awarded a U.S. firm about $28 million following Ontario's decision five years ago to put a moratorium on offshore wind power development.

The company, Windstream Energy LLC, said it has been awarded damages of more than $25.1 million, plus $2.9 million in legal costs.

Windstream signed a deal with the Ontario Power Authority back in 2010 to build a 130-turbine, 300 MW offshore wind power project in the Wolfe Island Shoals of Lake Ontario, near Kingston.

However, the Ontario government, in a surprise move, said in February 2011 that it was scrapping all offshore wind power projects until it had more scientific research into their impact on people's health.

Windstream made a claim under the rules of the North American Free Trade Agreement, saying Canada violated its obligations under the NAFTA, and sought about $568 million in damages. The case was made against Canada, not the province of Ontario, because matters under NAFTA are a federal responsibility.

The case was heard in February before the Permanent Court of Arbitration, which is based in the Netherlands.

In a release issued Thursday, Windstream said the tribunal declared that its contract is formally "in force" and has not been unilaterally terminated by the provincial government.

"This award is an appropriate first step at remedying the challenges we have faced,"  David Mars, director of Windstream Energy, in a release. "We look forward to working with the government of Ontario to build this project in accordance with the contract."

The tribunal's decision has not been made public yet.

"This is another outrageous example of taxpayers having to fund foreign corporations who do not respect the democratic rights of governments to regulate in the interests of their citizens," Maude Barlow, national chairperson of the Council of Canadians, said in a release. 

"This challenge should have gone to a Canadian court and not to an arbitration panel that favours foreign investors over domestic companies," Barlow said.

The governments of Canada and Ontario have both said they are considering their next moves.

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