Since its release of the Feed-In Tariff (FIT) program on
September 30, 2009, the Ontario Power Authority (OPA) has faced
both commendation and criticism. Throughout the Launch Period,
ending November 30, 2009, the OPA has released several
clarifications and amendments to the initial FIT program. The
following is a summary of the key announcements made throughout the
past two months and some of the issues that remain
Key Recent Announcements
Domestic Content Technical Notes: This
component of the FIT program has raised extensive criticism from
proponents. The OPA has indicated that the requirements set out in
the original FIT contract will not be changed but has now provided
further technical notes to assist proponents in interpreting these
obligations. These notes can be found on the OPA website and will
be updated periodically.
Agricultural Land Restrictions for Solar
PV: The OPA has announced that it will provide
guidelines for proponents that detail the benefits of more
renewable energy with the need to protect Ontario's prime
agricultural land and details on exemptions available for lands
zoned for non-agricultural purposes. Contained within these
guidelines will be details on the evidence that a proponent must
provide for proposed projects on such lands. These guidelines have
not been released as of the date of this update.
Transition options for microFIT (< 500 kW)
projects: On October 30, 2009, the OPA announced new
options for microFIT proponents that have projects in the late
phases of development. These new options exempt such projects from
domestic content requirements. Eligible proponents must have either
a previous RESOP contract or have purchased generation equipment
prior to October 1, 2009 and may elect to transition into the
microFIT program or amend the RESOP contract to reflect microFIT
Priority Access: As many generators
are aware, Ontarian's demand for electricity has been, at
certain times, well below the available generated load on the
system. Renewable energy projects have been given a priority right
of access to connect to the grid under amendments arising from the
Green Energy Act (GEA) but have no defined prioritized right in the
actual sale of generated electricity into the grid. As curtailment
decisions from the Independent Electricity System Operator (IESO)
and Local Distribution Companies (LDCs) become more common,
renewable energy generators face the same risk of generation
limitation that all other generators, including large scale gas
Transmission and Distribution: The
popularity of both the old Renewable Energy Standard Offer Program
(RESOP) and the FIT program clearly indicates that there are
countless project developers interested in entering the generation
market. The current determining factor of how quickly these
proponents are able to begin selling electricity is transmission
and distribution capacity. Hydro One Networks Inc. (HONI) has been
directed by the government to commence a large-scale transmission
expansion program which is planned to be on stream between 2013 and
2017. Many proponents have raised concerns that the required
expansions in both the transmission and distribution systems will
cause significant delays in meeting the demand of proposed
renewable energy generation facilities.
Conservation and Demand Management (CDM) and Smart
Grids: Conservation was a key component to the GEA
and it is expected that LDCs will play an important role in the
development of CDM protocols. It is anticipated that CDM targets
will be made a condition of distribution licences but the details
of such an amendment have not been released. The Ontario Energy
Board is expected to develop a CDM Code in the coming weeks which
will provide a framework on licensing targets and CDM
Despite the concerns raised by many renewable energy project
proponents, the FIT program has been, thus far, very well received.
As of November 10, 2009, the OPA had received more than 90
applications under the FIT program, representing more than 78 MW of
generated capacity and nearly 500 applications under the microFIT
program, representing more than 2.5 MW of generated capacity. In
comparison to the RESOP program, which contracted more than 1,316
MW of renewable generation, these numbers seem small but the OPA
has indicated that it expects these will more than double before
the end of the Launch Period. After the November 30, 2009 deadline,
the FIT program remains open to applications, although the standard
contract rules for time stamping and transmission/distribution
capacity allocation become applicable.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Canada is a constitutional monarchy, a parliamentary democracy and a federation comprised of ten provinces and three territories. Canada's judiciary is independent of the legislative and executive branches of Government.
The Government of Alberta recently announced a number of policy changes that will impact the Alberta Electricity Market, composed of its generators, transmitters, distributors, retailers, electricity consumers and wholesale electricity market.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).