Thursday, August 4, 2011

Ontario Liberals entrench 1,800 renewable power projects

Ontario’s Liberal government has entrenched the legal rights of 1,800 proposed renewable energy contracts – making it impossible for a new government to cancel them.

The Liberals have changed the terms for approving contracts under its feed-in tariff program or FIT.

Under the old system, the Ontario Power Authority, which signs the contracts with power developers, could unilaterally terminate proposed agreements at a relatively late stage of the approval process.

But a new directive from energy minister Brad Duguid will entrench the contracts at a much earlier stage in the process.

That will protect 1,800 contracts now in the pipeline from cancellation.

Collectively, the projects represent 3,500 megawatts of generating capacity, the equivalent of close to 10 per cent of the province’s current total capacity.

The issue is politically significant one, since Conservative leader Tim Hudak has vowed to cancel the FIT program if the Conservatives win the provincial election on Oct. 6.

Hudak has said the high prices paid under the FIT program are “unsustainable.”

While the Conservatives would not tear up existing contracts, projects that were only part way through the approval process would have been at risk of cancellation under a new government.

The new rules will reduce the scope for the power authority to cancel agreements for FIT projects.

Duguid said the changes will provide “stability and certainty” for renewable power developers and for their suppliers.

That will make it easier to finance renewable projects, and for power developers to place firm orders with equipment manufacturers, he said.

Duguid said the government has been discussing the issue with the industry for the past year.

But he used the occasion to take a swipe at the Conservatives.

“There’s no question Tim Hudak’s irresponsible plan to dismantle our programs and destroy our clean energy economy is something that’s creating a great deal of instability in our economy right now,” Duguid said.

No Conservative official was available to respond.

Proposed projects will still have to get environmental approval, show that they have a purchase agreement with an Ontario manufacturer and submit a financing plan before they can proceed.

Creating a clean energy sector and adding 50,000 jobs to the economy by the end of 2012 is a key plank in the Liberals’ election platform. The Liberals say they’ve created 20,000 jobs to date.

Peter Tabuns of the New Democratic Party shrugged off the significance of the announcement.

He said many renewable energy developers can’t connect their projects to the grid. Without connections, the projects can’t deliver power or get revenue.

“I think that’s the largest ongoing issue,” he said.

Robert Hornung of the Canadian Wind Energy Association offered cautious endorsement of the changes.

“It reduces project development risk,” said Hornung. “It clarifies in essence what’s required to firm up FIT contracts. That greater certainty makes it easier for them to go and secure financing.”
The association was polling its members yesterday to see how they reacted to the changes.


  1. The dream of Ontario hydro died in 1998 when it collapsed in 38 billion dollars worth of accumulated debt. That's reality. The entire concept failed. But it only gets worse. Despite the attempt at privatization no one lost their job - well other than leaner clitheroe and even she got a massive pay off and pension. Despite going bankrupt it didn't and all the overpaid workers kept their jobs instead of facing some kind of pay cut or restructuring they got pay increases and hired more staff. That's the true cost of hydro. Solution build more nuclear hat bankrupted them in the first place. Definition of insanity: keep doing the same thing over and over and expect different results. They are so good at going bankrupt that now they are doing it the green way and apparently somewhat successfully making cheap clean affordable solar look bad by offering artificially high rates. Lower the FIT. Get real.

  2. Should bring back the old NET generation contract. That made a lot more sense lol! With a few changes I think it would please a lot more people than the MicroFIT program.

    Supplement your power consumption to reduce your bill. Any extra you produce, say when you are not home, gets paid top rate. Best of both worlds. Saves the customer on their bill and gives them the chance to get paid for generating.

  3. There is a chance you're qualified for a new solar energy rebate program.
    Click here and discover if you are eligble now!


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