The recommendations of the Ontario government’s review of the FIT program, released on March 22, are likely to both solidify and refine the Feed-in Tariff program. A number of groups in the renewable energy sector praised the recommendations – even though they are expected to lead to lower prices for power from future FIT contracts. Soon after its release, the Ontario government indicated that it had accepted the central recommendations of the Review.
In its comment on the FIT Review recommendations, APPrO highlighted the fact that Ontario’s power producers welcomed the Ontario government’s commitment to continue with the FIT program and its readiness to accept the findings of the review process. APPrO President David Butters said, “Moving forward with these recommendations represents a reasonable balance between the government’s renewable energy policies, the current realities of the Ontario electricity system, and ratepayer interests.”
Butters noted that the review reflects a strong message from the industry to improve the approvals process for renewable energy projects. He said that changes in this area should help to reduce costs and improve outcomes for the system as a whole. “We are looking forward to understanding the details and working with the Ontario Government to get these new processes in place,” he said. He noted that initiatives to facilitate greater municipal and community engagement in renewable energy development are timely and sensible. “We want to ensure that development proceeds where the local stakeholders are well informed and supportive of the project.”
Butters said that increasing the frequency of price reviews, at the same time taking into account supply and demand forecasts and considering whether continued renewables procurement is warranted, is a realistic and responsible approach, given Ontario’s current supply and demand situation. He also added that ongoing efforts to integrate wind energy efficiently and fairly into the Ontario grid must also remain a high priority.
He concluded that APPrO and its members are looking forward to the specific contract and rule changes and an opportunity for meaningful input into their finalization.
The Canadian Wind Energy Association (CanWEA) noted that “the Ontario Government’s review of the FIT program has made a commitment to procure all the energy required to meet its aggressive renewable energy targets by 2015 and to examine in 2013 the potential for additional renewable energy procurements. Coupled with the Ontario Government’s strong commitment to continue with the FIT program, this provides the stable policy framework investors need and ensures that Ontario will continue to be a leading destination for wind energy project and manufacturing investment in North America – bringing jobs and economic benefits to communities across Ontario.”
Acknowledging the new pricing, Robert Hornung, President of CanWEA, said, “We believe that this new price will prove extremely challenging for many projects and could prevent a number of them from proceeding. This is particularly true for smaller projects and new entrants to the industry, reducing the number of communities and the diversity of players able to contribute to and benefit from the government’s ambitious objectives.”
Kristopher Stevens, the Executive Director of OSEA, said “The Government’s re-engagement and willingness to improve the program is both very important and timely. This renewed commitment will further strengthen Ontario’s leadership role in renewable energy.”
The two-year FIT Review considered a number of issues including:
• ensuring the long-term sustainability of clean energy procurement
• continuing to build on the success of Ontario-based manufacturing and clean energy job creation
• consideration of new technologies and fuel sources
• local consultation and the renewable energy approval (REA) process
• application process rules.
Based on the recommendations of the Review, changes are expected in several areas including the following:
• Pricing of power procured under new FIT contracts
• Increased levels of municipal engagement
• Additional encouragement for community and Aboriginal participation
• A new system for priorizing projects based in part on the above factors
• Streamlining the Renewable Energy Approvals process
• Rules relating to upgrades for making generator connections.
The OPA noted that since the review recommendations have been formally adopted, it will now move ahead with completing draft Program Rules and draft contracts for the next phase of the FIT program. These materials will be posted on the microFIT and FIT websites (http://fit.powerauthority.on.ca/) shortly for review and comment.
The FIT review report is easily available from the website of the Ministry of Energy.