Ontario Cuts Feed in Tariff for Micro Solar Ground Mounted Plants but Honors Former Contracts under Strident Opposition

Ontario had released a comprehensive Feed in Tariff program for Green Energy in 2009 leading to a boom in Solar Installations.However the best of FIT programs don’t give a perfect result with some leading to outright bursts.The Czech Solar Boom in 2009-10 closely followed the Spanish boom in 2008.Both were results of faulty Feed in Tariff Policies which lead to a BoomBust Cycle.Ontario had ample opportunity to learn from past experience and its Renewable Energy Subsidy Policy is on the whole quite good.However one part of the FIT program which gave a very generous 80.2c/KwH to micro installations of solar projects under 10 KW was faulty.It led to 160 MW of project applications which were ground mounted with very high production as they used trackers.There was no discrimination between roof and ground mounted micro installations leading to this problem.Note its not possible to install trackers on roofs which can increase the energy by 30-35%.The large number of applications were not factored in by the Ontario Power Authority (OPA) which proposed to retroactively cut those tariffs by 27% for ground plants.This led to a major protest from the Renewable Energy Industry and Investors in these Projects.

Groups oppose solar rate cut – BetterFarming

The Ontario government announced July 2 the rate paid for electricity from ground-mounted, solar-energy production systems would be 58.8 cents a kilowatt under microFIT, a 27 per cent cut from the original price of 80.2 cents a kilowatt. The program provides compensation and a fast-tracked approval process to power generation projects of 10 kilowatts or less.

The province is proposing to apply the new fee to applications submitted but not yet approved. At the time the cut was announced, more than 16,000 applications for consideration under the microFIT program had been submitted, the bulk of which were for ground-mounted solar projects. The 80.2 cents a kilowatt still remains for rooftop projects in the microFIT program.

Ontario Honors Former Contracts after Strident Opposition

The Ontario Government had come under fire for not honoring its contracts which would lead to a loss of confidence in investors.Note Spain too had recently backed down from retroactive Solar FIT cuts after massive pushback by investors.Ontario has however cut the FIT rate on ground mounted plants under 10 KW to 64c/KwH but these rates will only apply to newer plants.The older applications will continue to draw higher electricity tariffs.This is a good step by the Government as it restores investment confidence at a very small cost.This incidence highlights the importance of a well designed FIT policy before implementation.Note a huge FIT proposal has been released by NREL on implementing this very successful subsidy scheme in the USA.

Ontario concedes on solar energy payments – Record.com

Farmers and business owners in Waterloo Region who have invested in ground-mounted solar systems were relieved and happy on Friday after winning concessions from the Ontario government on the price they will get for their solar energy.

The Ontario Power Authority said Friday it will not retroactively lower the price on the energy produced by individual land owners, mainly farmers, who have ground-mounted solar equipment and who applied before July 2 to get paid a premium for producing energy that is fed back into the hydro grid.

The Ontario Power Authority said it will lower the rate to 64.2 cents per kilowatt hour from the original 80.2 cents, but that rate will apply only to people with ground-mounted systems who applied after the government announced a price change on July 2.

Under the micro feed-in-tariff program announced last year, homeowners, farmers and community groups who invest in solar power can get 20-year contracts with the Ontario Power Authority for energy they sell back to the hydro grid.

Ground-mounted solar systems, which are mainly on farms because they are too big for an average residential property, became a thorn in the government’s side. Those systems can track the sun and produce energy much more efficiently than roof-top systems. As a result, they generate more revenue for the owners than the government intended.

That prompted the government to drop the price, which resulted in the protests from those who had already applied for 20-year contracts. Some farmers had arranged for financing in the belief that they would get 80.2 cents for the energy they produced.