by BETTER FARMING STAFF
A Chatham solar power co-operative venture will likely collapse if the Ontario Power Authority adopts proposed changes in power generation payment rates for its micro feed-in-tariff program, says a co-operative spokesman.
“From what we know today, we can’t build ground mounted installations at the rate being proposed,” says Jim Campbell, secretary of Agris Solar Co-op.
The co-operative partnered with Spark Solar to pool panel earnings under the microFIT program and offers members a share of the annual surplus in exchange for a $20,000 investment. According to the co-operative’s website, it has 650 members. Most are farmers.
Introduced late last year, the microFIT program offered 20-year contracts to homeowners, farmers, small businesses and institutions to buy power at 80.2 cents per kilowatt-hour from solar units generating 10 kilowatts or less. Last week, the province and the power authority announced a proposal to change the fee to 58.8 cents per kWh for ground-mounted solar systems. The original rate will still apply to roof top solar systems.
Brad Duguid, provincial minister of energy and infrastructure, says the change in price corrects a loophole within the program for applicants to earn an “exorbitant” return on their investment.
The authority and the province are seeking industry comment about the proposal this month.
“The suggestion from Ontario Power Authority that farm families are going to receive an unreasonable return on their investment by investing in ground-mounted solar is just not consistent with the actual returns we see in our co-operative model,” says Campbell. “We are hopeful the government didn’t really intend to adversely affect farm families who are buying into this program.”
Campbell says the co-operative’s numbers do not support Duguid’s contentions that capital costs are “fundamentally lower” for ground-mounted solar units compared to roof top units. He says the returns the co-operative would receive on individual units are the same as what farmers would receive on their own. The gain in buying power for the group is offset by “administrative costs,” he says.
Campbell says he has received calls “all day long” from members who wonder how the rules can change after applications are filed. He says the co-operative does not object to the rates eventually going down as long as the change is planned for and happens over time.
He says the co-operative will participate in the province’s consultation sessions. “Maybe the government has information on capital costs that is different from what we understand them to be today,” he says. “We may learn something.” BF
Comments
It would appear to me that this co-op is super-lucky in that the rules changed before too much money was squandered. The best thing is to just simply give as much of the money back to investors as is possible, in order to minimize the losses to these investors.
The members of this co-op may inadvertently turn out to be the luckiest people in this whole mess.
too pay for electric power in ontario,,,,who would want too pay that on there hydro bill.I feel for Agris and ones who have put a lot of time and energy into these projects feeling betrayed by the liberals again but we know that is how Dalton works.On the wind turbines my "friend" Bruce Crozier mpp was on CBC stating how wind turbines on the lakes will have to be 5km off shore . Great for the guy with a 2 million dollar house between Kingsville and Leamington,ect. but what about the guys in the country with a turbine a 1,000 feet from there house.
Now an second stage eco tax,hst and energy projects that make no economical sense,ect.it really hurts to say that I supported or voted for this gov't.
Agris,,good luck,I hope they re-imburse your members for there "planning costs" K G Kimball
My son directed my attention to a 'Star' article of Friday where McGuinty was taking heat from his caucus because they were being bombarded with complaints. Dalton says "you're just going to have to wear this and I'm going to have to wear it too". My guess is that OPA has had a directive from above and the reduction is a done deal, 30 day review or not. I don't know if I could deal for 20 years with a morally and ethically bankrupt corporation - you would never be comfortable. I know that some applications in line now will be converted by the deadline but it will be interesting to see how many new apps are filed.
I attended an OMAF info session recently on biomass and the production/sale of pellets to OPA to replace coal at the Nanticoke and Lambton GS - my guess would be that OMAF could call off that research.
I don't think so. This is a 20 year contract. I am sure electricity prices will rise and the 80.2 cents will be considered cheap towards the end of the contract. Just ask the citizens of Newfoundland how they feel about the long term contract they inked with Quebec on the Churchill Power Dam.
Solar power is at it's peak when we import power at well over $1.00 during high demand. This price will also rise.
The cost to our health care system due to burning coal here and in the USA on our behalf costs us billions and kills thousands. These prices will rise too.
Nuclear power plants are the reason our utility went into debt. We may walk down that road again. We won't realize the final cost of our nukes until they run to the end of their useful lives and need to be decommissioned which some have said will cost more than they ever generated in revenue.
80.2 cents doesn't sound like a bad deal too me.
The current events as I have seen them appear to me as a knee jerk reaction to some bad press likely to people who don't understand all of the above and don't live downwind of a coal generating station. They were likely edged on by supporters of conventional power generation that is also heavily subsidized except for water power. The Ontario government didn't know how to defend their position and perhaps because they didn't completely understand renewable energy in the first place. They relied on "experts" and not the people actually in the business. This became abundantly clear to me when they began saying that ground mounted systems were cheaper to install when anyone in the business knows they are clearly not. I just completed a 10KW pole mounted installation and the cost of roof mounting wouldn't cover the concrete work before we got started on erecting the system. When their error became evident in the first OPA webinar the focus shifted to unreasonable profits on the second one. The "problem" was a result of people that knew what they were doing with the technology and being good at what they do best. The extra revenue is created by the use of systems that automatically track the sun increase generation by up to 40%. Ground mounted systems that are not tracked make pretty much the same as roof mounts because they don't track the sun, but as a result of the new changes will also get paid a lower rate. The fact the government didn't recognize this shows a lack of understanding of the technology.
On the topic of lack of understanding there are many businesses that invested heavily in this and have lost millions in lost business,. Some businesses that were going to locate here to participate in the Ontario content ruling and create jobs have pulled out. This could have been averted by a little research into what would happen to changing crucial numbers in everyone's business plan overnight.
The timing of this could not have been worse as the OPA did not approve ground mounted projects since January and the total applications waiting in the Microfit program has swelled to 16000. The announcement and 30 day comment period will get us well into August. The certainty of getting your system up and inspected by the end of the year when the 60% content rules kick in are bleak and prices are definitely due to rise if you can find any Ontario content.
If you find this a bit much I hear you can get GIC's at the bank at .5%
Rick Guthrie
Temiskaming Independent Energy
Rick you are sounding like us farmers ,,if its good for me it should be good for everyone...if in 20 yrs. electric costs are 80 cents kwh. our province will be bankrupt as no industry or farm can pay that..let's just get over all this non-sense and not worry about fossil fuels and build a few new nuclear plants
I would love too get a loan at .5% for 20 yrs....GIC for a long term can be paying 5% +
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