Toronto: Ontario’s large-scale renewable energy procurement program, in abeyance for more than two years, is the subject of extensive public consultations by the OPA. In parallel with the Ministry’s Long Term Energy Plan (LTEP) Review and the OPA’s Regional Energy Planning Review already underway, the Ontario Power Authority is also launching a third consultative process on competitive procurement options to replace the Large FIT program. The OPA began this work by engaging with stakeholders, municipalities and Aboriginal communities starting with a webinar on August 7. The OPA notes that “this is the beginning of the discussion about the new competitive procurement process,” and that it “will be providing the Minister with interim recommendations by September 1, 2013, and it is expected that additional engagement activities will occur in fall 2013.” Written submissions were being accepted until August 21, 2013.
The OPA’s webinar of August 7 provided stakeholders an opportunity to pose questions to OPA staff and to better understand the stage of development the procurement process has reached. It was explained during the webinar that there is no firm timeline at this point for the release of the next round of procurement for large renewable energy projects, whether that be in an RFP or some other form. Interim recommendations on procurement are expected to be given to the Minister on September 1. Consultation with municipalities is likely to be a significant aspect of the development work before final recommendations are presented.
Adam Butterfield, the OPA’s Manager of Renewable Generation Procurement, observed that the OPA could consider an approach that would focus RFPs in areas that are not transmission-constrained. Although tests of financial feasibility are likely to be a significant aspect of the competitive procurement process, no model for assessing project financial feasibility has yet been created. It is clear that the new procurement process will have significant differences from the FIT program to date. For one thing, the new process will have to conform with the recent ruling of the World Trade Organization on Domestic Content requirements. In addition, OPA staff noted that for large FIT project applications that have not received contracts, the previous application queue has been terminated, and time stamps from that period have been discontinued.
In response to a webinar question OPA staff agreed that it would be appropriate to have regularly published updates to what are known as the TAT and DAT tables – technical reports that assess the amount of generation connection capacity available at various locations across the province.
Writing to the OPA in May 2009, APPrO commended the OPA for its “remarkably thorough and open process” of collecting stakeholder input. APPrO also said that “it is important to note that additional risks and costs are created each time a program is overhauled. These risks are not just risks borne by the developer but risks to the program as a whole, and to Ontario ratepayers and taxpayers if investors turn their attention to jurisdictions where policy and program regimes are fixed. … For best results in a long-term industry like power generation it is important that a program, once set up, is able to run for a substantial period of time, safe from exogenous factors.”
In summary, the OPA is not entertaining new applications for renewable energy at the moment. The large FIT program is under review and the current small FIT program application window closed in January. In the microFIT program, the OPA recently announced that it had reached its target of 50 MW for the current round of procurement. Although more than 5,300 microFIT applications have been processed, the OPA is effectively not accepting further applications at this time. The OPA expects to open a new small FIT application period for 123.5 MW in the fall, as well as a new microFIT application period for 30 MW by the end of August.
Materials documenting the development process are expected to be posted on archive pages of the OPA website.