The Alliance for Renewable Energy

Status of FITs in Ontario

Ontario Power System: The generation and distribution of electric power in Ontario is regulated by the Ontario Energy Board. The Independent Electricity System Operator (IESO) manages Ontario’s wholesale power generation and sales market. The Ontario Power Authority (OPA) is responsible for power planning, conservation, and the contracting of generation capacity outside the wholesale market. Transmission and rural distribution is run by a provincial government corporation - Hydro One. Urban distribution is operated by a series of private or municipal owned Local Distribution Utilities. Large rural renewable energy generators are mostly connected to the transmission system while smaller generators feed into local distribution systems.

Ontario also has a competitive retail market for electricity so that individual customers can purchase 100% renewable power from retailers at a premium price.

Ontario FIT and MicroFIT Programs: The Government of Ontario officially launched its feed-in tariff in initiative in 2009 through the Green Energy and Economy Act – at the time the most comprehensive of its kind in the Americas. The Ontario FIT and Micro-FIT (for systems <10kW) programs are operated by the Ontario Power Authority and give priority grid access to renewable sources of power and set fixed tariffs under 20 year contracts. The FIT Programs allows any renewable power system, from the smallest household solar system to large wind farms, to connect to the grid and be paid tariffs that provide a reasonable return on investment.

By the end of 2012, contracts for over 9000 MW of new renewable power had been offered with more than 1300 MW in commercial operation – the rest under development. These contracts have already leveraged over $10 billion in private investment and resulted in significant new solar and wind manufacturing capacity and hundreds of new jobs in Ontario. The program has been so successful that the 2018 provincial targets of 10.7 GW of new renewable power producing 10-15% of the Ontario’s electricity will be reached 5 years early. Increasing grid capacity has become a major factor in rate of deployment of new renewable power systems.

The two original FIT and MicroFIT programs were put on hold in 2011 while they underwent their first scheduled price and rule review. The review report released on March 22, 2012 can be viewed at http://www.energy.gov.on.ca/en/fit-and-microfit-program/2-year-fit-review/.  For a variety of reasons (see commentary below), the programs have been very slow at re-starting. A new MicroFIT 2 Program was opened in August 2012 with a target of 50 MW. A new “Small FIT 2 Program” window was opened for only six weeks in December 2012 with a target of only 200 MW. 

The new Program rules give priority to community or First Nation owned projects, and those on health care and municipal facilities, through a series of “set asides” and a priority points system . An “adder” of up 1.5 cent/kWh will continue to be paid on non-solar projects for community and First Nations projects and a premium paid for biomass and hydro projects that deliver power during peak periods. Community power projects will also continue to be eligible for legal and project development grants under the Community Energy Partnership Program.

The new rates reflect the lower cost of solar and wind systems in 2012 – a sign of success of the program to date.

For more details on the new FIT Program rates and rules visit http://fit.powerauthority.on.ca/

Participation in the FIT program requires the payment of a registration fee and application security. Projects that require additional grid capacity are required to meet transmission/distribution availability and economic connection tests. All these requirements are waived for MicroFIT projects less than 10 kW. Both FIT and MicroFIT projects must meet Ontario domestic content requirements.

In addition to the FIT Program, Ontario is making major new transmission investment for grid expansions to accommodate increased renewable energy deployment and to develop a smart grid – see http://www.ieso.ca/imoweb/siteShared/ontarios_smart_grid.asp?sid=md .

Commentary: The introduction of feed-in tariffs and guaranteed access for renewable power sources in 2009 promised a complete change in the way power would be provided to Ontarians in the 21st century, with a new Ontario grid built around these renewable power sources. Up until then, renewable power sources had to be integrated into an existing grid. However, the government’s commitment to this transition in 2013 is not as strong. Insufficient support for community ownership in the initial FIT Program led to several large wind farms being opposed by local residents. The very success of the FIT programs also led quickly to grid constraints and renewable capacity outstripping the power planning process. The long delays in re-starting the FIT programs and the new short application windows have resulted in many renewable energy companies closing down and a struggling community power sector.

Hopefully, provincial targets for renewable power will be raised and a more stable feed-in tariff program established in 2013.

What Feed-in Tariffs Could Do for Japan's Electricity Shortage

 

What Japan Could Do if It Followed Germany's Lead on Renewable Energy

Within one Decade Japan Could Halve its Dependence on Nuclear Power

April 14, 2011

By Paul Gipe

If Japan adopted an aggressive renewable energy policy like that of Germany, it could, within ten years, generate more than four times the electricity lost at the Fukushima 1 nuclear power plant, cutting the country's reliance on nuclear power by one-half or more.

As Japan expands the evacuation zone around the damaged Fukushima 1 nuclear plant from 20 km to 30 km and Tokyo Electric Power (TEPCO) skirts the edge of bankruptcy, the country confronts a stark choice: undertake a massive construction program to replace the nuclear reactors with more of the same, or, instead, follow a new, less risky, and potentially more strategic path toward rapid renewable energy development. The stakes are high and the fight is already intense as Japanese elites debate the future of their electricity system, and literally, the future of their country.

San Francisco Feed-in Tariff Conference

From the press release:

Pacific Environment, the World Future Council, the Boell Foundation and others are hosting a one-day conference titled “Feed-in Tariffs: A Time for Real Action on Renewable Energy.” The event will be held in San Francisco on July 12, 2010 to discuss the rapid deployment of renewable energy in the U.S. using Feed-in Tariffs (FiT), a policy mechanism that has been successfully implemented in Europe and other areas of the world. Focusing mainly on California and the West Coast, industry experts from government, business, and the environmental field will discuss Feed-in Tariffs as a policy option, and as a way to stimulate investment in renewable energy, increase energy security and promote economic development inCalifornia.

 

Key objectives of the conference include:

• Increasing understanding of Feed-in Tariffs (FiT), including their significant potential to address climate change, create new jobs and rapidly develop renewable energy
• Discussing how to draft and implement renewable energy laws in the United States, with a focus on California and the West Coast, looking specifically at Feed-in Tariffs
• Developing political strategies for implementing robust Feed-in Tariffs
• Building new coalitions and networks

Learn more and register.

Fascinating, Simple Explanation of How FITs (a.k.a REPs) Work

Feed-in Tariffs are also referred to as "Renewable Energy Payments," or "REPs." This video from the non-profit Solar One explains how FITs work:
How Renewable Energy Payments (REPs) Work. from Chris Neidl on Vimeo.

Also, please take a moment to become a fan of Feed-in Tariffs on Facebook!

US Legislative Action, January - April 2009

During this time, Renewable Energy Payment legislative action has moved forward in 16 states: Arkansas, California, Florida, Hawaii, Indiana, Iowa, Maine, Michigan, Minnesota, New Mexico, New York, Oregon, Virginia, Vermont, Washington, and Wisconsin.

Wind farms could energize Minnesota's Economy with help of Renewable Energy Payments

Minnesota's Renewable Energy Standard (RES) requires 25 percent of the state's electricity to come from renewable sources by 2025. This aggressive standard will produce significant regional economic benefits in Greater Minnesota, but such rapid expansion in renewable energy production, particularly wind, will require an enormous amount of financing. Implementation of a REP would provide easier access to capital while promoting community wind development.

Read more.

Getting Connected: Why Sharing Electrons, Local Produce, and Radiohead Makes for Better Communities

Bill McKibben, scholar in residence at Middlebury College in Vermont, offers up his thoughts on why we need to have a personal stake in generating energy, and why being connected to the grid is important. Along the same veins as those who encourage one to buy local, he offers up a fascinating treatise on the importance of communities and personal connections with those around you. In his words,

"A few years ago, when we were installing photovoltaic panels all over our roof, the question was whether to go off-grid or to tie in. We chose the latter, connecting with our nifty SMA Sunny Boy inverter, but not really for technical or economic reasons. We chose it because we like connections — we like networks, we like community, even when it’s a community of electrons. I enjoy looking over at my neighbor’s house and realizing that, at least metaphorically, he is cooling his beer before the Red Sox game with the sunlight that is falling on my shingles. And I think one of the most important arguments to be made for renewable energy is precisely that it can help build community."

Click on this link to read the rest of his article, as well as to check out the fascinating links and books he recommends.

(Photo courtesy of Flickr user HAMED MASOUMI shared under a Creative Commons license.)