Although many of the connection capacity limits at affected transformer stations were adjusted on the Hydro One website before the FIT program’s initial application deadline of November 30, some applicants were probably unaware of the changes when they made their applications to the OPA. Proponents who approached Hydro One for initial consultations before that date, or those who attended the APPrO session on connections on November 17 or the OPA webinar on November 20 would have been made aware of the issues. A number of proponents are likely to feel overlooked because Hydro One did not systematically notify all applicants that changes were being made. In addition, an explanation of the changes was not posted on the Hydro One website at the time the new limits appeared, a crucial period in the application process.
“I think Hydro One has recognized the need to communicate more fully on issues of this nature in future,” said Jake Brooks, APPrO's Executive Director. “At the same time, proponents have probably learned that there is great value in maintaining regular communication with Hydro One on their applications.”
Hydro One has identified two technical issues on its distribution system which mean that the previously published figures for available connection capacity at certain transformer stations were overstated. The first issue is that a certain type of transformer, known as “dual winding,” is at risk of overheating if certain amounts of power are allowed to flow in two directions at once. Mark Fukuzawa, Director of Customer Care for Hydro One Networks stated that this issue was recently brought to Hydro One’s attention by a manufacturer of these transformers.
The second issue, identified through the Distance Limiting Test, is that power quality for consumers could be negatively impacted in some locations where generators propose to connect near the end of relatively long rural lines. With respect to this issue, Mr. Fukuzawa has noted that “as a result of recent generation connections to our distribution system on long rural feeders, … we (Hydro One) were able to confirm that there clearly is an adverse impact on local load customers, and in response, Hydro One developed new feeder limitation criteria.”
Mr. Fukuzawa further said, “We recognize generators are relying on us to manage our obligations in a manner that brings certainty to the timing of their projects. We also understand that what we do and when we do it can have financial implications for generators. We will continue to work with generators to identify their issues proactively on technical solutions. Regardless, we must take care to identify solutions that ensure power quality and protect the integrity and reliability of our system for everyone in Ontario.”
“The commercial implications for such changes could be very widespread,” said Brooks. “A key principle of the FIT program was to give developers assurance of stability. No one wants to see such significant revisions to the published capacity limits at any time, let alone in the middle of the selection process for the key renewable energy procurement process in the province. I understand that it’s a pretty unusual situation for Hydro One.”
Uwe Roeper of ORTECH, an Ontario-based consulting group, published commentary on the issue on February 5, which read in part as follows:
“Since the FIT applications were submitted in Ontario in November, Hydro One has been quietly reducing the amount of available capacity on the distribution side of transformer stations (“TS”) and on distribution feeder lines. The reductions appear to be as much as 80% of the available MWs and could result in projects not receiving a FIT contract that otherwise should have, if they relied on Hydro One information available at the time of FIT submission. … Apparently, Hydro One has … realized that its current grid equipment is not adequate for connecting the amount of distribution system capacity that was advertised prior to the FIT submission deadline.
“The lesser issue is the new ‘Distance Limiting Test.’ Over the past three weeks, Hydro One has been advising grid applicants in private meetings that the capacity available on distribution feeder lines is less than what was posted prior to FIT submission depending on the distance that the proposed project is located from the TS. The fix is either to ask the generator to reduce the size of the project or to connect further away (i.e. closer to the TS). The net result could either be that a FIT contract is not awarded or that the developer will have to bear additional costs.
“The greater issue appears to be (with) dual-wound transformer equipment. Any TS with such equipment will only be able to connect a fraction of the capacity posted prior to FIT submission. One specific example that we are aware of, is a TS that has been de-rated from 101 MW (prior to FIT submission) to 16 MW now (to be used to decide FIT awards). We have been told that a large number of TS stations with the dual-wound transformer equipment could be affected. Apparently Hydro One has quietly started to change the posted capacity advertised on the web link without notifying FIT applicants (generally beforehand). …
“According to a source at Hydro One, an updated capacity list will be sent to the OPA in the near future and will form the basis for FIT awards. As this issue pertains to the distribution system, it will primarily affect the many smaller FIT projects that had followed earlier recommendations to connect to the distribution system. It remains to be seen if Hydro One will upgrade its distribution equipment over time to allow the many smaller distribution connections to occur. The concern is that it may be too late as the FIT capacity may have been awarded to larger transmission connection projects in the meantime. Small may not be beautiful after all.” Hydro One has noted that in fact it has no choice in these matters - it is obliged to upgrade generator connection capacity in accordance with the rules set by the OEB.
Mr. Roeper concluded, “The issue is likely to be delicate. FIT applicants had to state the connection points in the FIT application and commit to their connection decisions. … We are aware of two ‘shovel ready’ projects that had completed Hydro One’s Connection Impact Assessment (“CIA”), been told that they had capacity and could connect, were then encouraged to rescind the CIA to participate in FIT, and are now being told that they will not be able to connect or get a FIT Contract. We speculate that there are many projects in a similar situation. We are advising our clients to monitor the Hydro One website over the coming weeks to determine if their connection points will be affected. In some circumstances, it may be possible to mitigate the issue either through dialog with the OPA or by changing the project size to fit the de-rated specifications.”
Mr. Fukuzawa noted that, “Hydro One participated in a FIT webcast on November 20, 2009, involving many generators. On the webcast we raised these issues noted above and explained we would seek technical solutions working with generators. Since that time, we have identified proponents impacted by these technical issues and met with them face-to-face to talk about possible solutions including making alterations to project scopes or helping generators locate their projects based on available capacity. We also continue to attend industry events and conferences to convey important information directly with our generator customers.” Brooks notes that, “the issue has underlined the importance of Hydro One maintaining a high level of communication between itself and generators.”
Mr. Fukuzawa also pointed out that, "Hydro One has connected 122 generators to its distribution system totaling 246 MW and has more than 500 MW of Renewable Energy Standard Offer Program (RESOP) contracted generation which the Company expects to connect in 2010. The Company has connected more than 5,500 MW of new generation to the transmission system since 2004 and in addition, there is almost 2,500 MW committed for connection to transmission. Of this, about 1900 MW is renewable wind and hydro, and about 6,100 MW is new cleaner natural gas required to ensure adequate supply given coal shut down and the intermittent nature of some renewable generation."
On the broader question of reinforcing the transmission and distribution systems, he noted that, “The Green Energy and Green Economy Act makes it clear that wire companies are expected to work proactively to increase capability of wires system to incorporate new renewables. This means not only building new infrastructure (wires and stations) to eliminate constraints in connecting new generation to the system but fundamentally changing the operation of the grid, particularly distribution, by making it ‘smarter’ in order to allow for two-way flows. Hydro One takes this obligation very seriously and is committed to expanding its system to enable new renewable generation for the benefit of all Ontarians.” It remains to be seen if enhancements can be put in place quickly enough to salvage any otherwise viable projects that were ruled out by the recent changes.
Developers are advised to contact appropriate consulting engineers for information on how the latest changes might affect their project. Hydro One expects to convene meetings with stakeholders on these issues in the near future, and invites generators to contact them directly at 1-877-447-4412 or by email at
To reach Mr. Roeper, either for more information on the above, or for assistance with project-specific questions, interested parties may call (905) 822-4120 x248 or email
On February 18 Hydro One updated its web page with the latest connection availability information. It can be accessed at this location:
http://www.hydroone.com/Generators/Documents/External%20LAC%20Feb%2018%2010.pdf
Mr. Roeper has compared the amount of available TS capacity shown on Hydro One’s website in August of 2009 to the updated list published on January 15th, 2010. He notes that “the sum of the available station capacities changed from 12,202 MW to 7,840 MW respectively for those dates. The greatest percentage change was Timmins TS which went from 60 MW to 0 MW.” He has not yet analyzed the new February 18th list.
More generally, information on connecting to the Hydro One system can be found here:
http://www.hydroone.com/Generators/Pages/Distribution.aspx