Ontario's farm community prepares for green energy rate drop

Thursday, November 3, 2011

by SUSAN MANN

New applicants and those who submitted applications after Aug. 31 to Ontario’s micro feed-in-tariff program can expect new rules and prices as the province gears up to review its green energy power generation programs.

Jim Campbell, secretary for AGRIS Solar Co-operative, says it makes sense the rate paid to energy producers under the program comes down because capital costs on various renewable energy project components have decreased. AGRIS is a farmer-owned solar energy cooperative.

“This is all very much anticipated,” he says, noting from their point of view there’s nothing surprising about it.

Farmers with existing contracts or conditional offers under the micro Feed-in-Tariff program won’t be affected by the review.

Ontario Energy Minister Chris Bentley announced Monday the government is reviewing its Feed-in-Tariff (FIT) and microFIT programs. When the government launched the FIT program in 2009, it committed to doing a review every two years. The government’s plan for a review was also reiterated in Ontario’s long-term energy plan.

One of the review’s outcomes will be new prices for FIT contracts that have been “carefully developed to balance the interests of ratepayers with the need to encourage investments in new clean energy in Ontario,” states the Energy Ministry press release announcing the review.

Dr. Richard Vyn of the University of Guelph’s Centre for Agricultural Renewable Energy and Sustainability at the Ridgetown Campus, says lower prices for microFIT energy producers may reduce the number of farmers interested applying for the program.

But he understands why the government is reviewing the program and why there’s pressure to reduce the fee for energy producers. The cost of producing energy from nuclear sources is four or five cents per kilowatt hour. “You’re paying 20 times that for solar energy and it does raise questions,” he says.

Deputy Energy Minister Fareed Amin will lead the review, which will:

•    ensure the long-term sustainability of clean energy procurement;
•    continue to build on the success of Ontario-based manufacturing and clean energy job creation;
•    consider new technologies and fuel sources; and
•    study local consultations and the renewable approval process.

Amin will consult with the renewable energy sector and work with the Ontario Power Authority (OPA) and the energy ministry. Ontarians can have their say by participating in an online survey or submitting written comments until Dec. 14.

Energy Ministry spokesman Andrew Block says recommendations will be submitted to the minister in early 2012.

OPA spokesman Tim Butter says in an email the review “will build on the success of the program – continuing to ensure long-term sustainability, transparency and predictability for industry and investors.”

Ontario Federation of Agriculture president Bette Jean Crews says they’ll be monitoring the review to ensure farmers and rural residents still have access to the program. “We’ll be lobbying to make sure that we’re not cut off.”

During the review, FIT and microFIT applications will continue to be accepted and time stamped but they won’t be processed until the new rules and pricing schedule are available. Existing FIT applications that were submitted before the program review announcement on Oct. 31 but haven’t yet received a contract will be processed under the new rules.

OPA will refund the FIT application fee for those who withdraw their application because of the program review announcement. Normally that fee isn’t refundable. The review won’t affect existing contracts and projects should proceed under their existing contract terms and obligations.

The microFIT application process doesn’t have an application fee.

Since launching the FIT program in 2009 the province has offered contracts to about 2,500 medium and large FIT projects. More than 11,000 microFIT projects have connected or will be connected soon. This represents enough electricity to power almost 1.2 million homes. BF