ONTARIO LAUNCHES FEED-IN TARIFF PROGRAM REVIEW

OVERVIEW

On October 31, 2011, the Ontario Government announced its much anticipated review of the Feed-In Tariff (FIT) Program ("FIT Review").

The basic purpose of the FIT Review is to examine existing program rules and pricing structures in an effort to ensure the program is sustainable over the long term. The FIT Program was designed to provide a program review every two years.

REVIEW PROCESS

Deputy Minister Fareed Amin, formerly the Deputy Minister of Energy, has been appointed to lead this review and will work closely with the Ministry of Energy and the Ontario Power Authority. The review will include direct consultation with key stakeholders in the renewable energy sector, including: project developers, community and First Nations groups, trade associations, municipalities, the post secondary sector, municipal utilities, consumer groups and manufacturers. The consultation process will include individual meetings, formal written submissions, teleconferences and sessions with the FIT/microFIT Advisory Panels.

The consultation period will run from October 31 until December 14, 2011. In addition, a broad form of public consultation will also be contemplated using web based tools. Surveys and submissions can be completed at the following email address: 2yearFITreview@ontario.ca

REVIEW OBJECTIVES

The FIT Review will seek to achieve the following objectives:

  • Ensure that new program rules, contracts and price schedules are sufficiently detailed and understood by key stakeholders.
  • Identify key implementation issues that need to be addressed.
  • Gain a more in-depth understanding of stakeholder concerns and issues.

REVIEW CONTENT

The FIT Review will address a range of FIT program issues, including:

  • FIT pricing to ensure a balance between the interests of electricity ratepayers and the continued stimulation of clean energy investment in Ontario. This review will involve new price modelling and is expected to result in reduced FIT prices for future contracts.
  • New and emerging clean energy technology types and how they may be included in the FIT Program.
  • A wide ranging assessment of government policies and tools to ensure that Ontario retains a competitive manufacturing sector that can attract clean energy investments.
  • Consideration of community outreach techniques to complement the province's Renewable Energy Approval process.
  • The alignment of the Long Term Energy Plan and Supply Mix planning targets (10,700 MWs non-hydro renewables 9,000 MW hydro).
  • Forms of participation and eligibility considerations.
  • Alignment with key regulatory processes.

Under current FIT Program rules, changes in FIT pricing which may result from the program review will not affect the prices provided in existing FIT contracts entered into by the OPA. However, applicants which have not entered into FIT contracts will receive the pricing in effect at the time a FIT contract offer is received and a contract reflecting any other changes to the FIT contract resulting from the FIT Review.

A similar review of the microFIT program was also announced on October 31, 2011 with consultations continuing until December 14, 2011. microFIT applications will continue to be received while the review is underway but will not be processed until the new microFIT rules and pricing schedule have been issued. Existing microFIT applications submitted up to August 31, 2011 will be processed and issued conditional offers under the existing rules and pricing schedules. Applications submitted after August 31, 2011 will be subject to the new rules and pricing schedule. The microFIT review will not affect existing contracts or outstanding conditional offers.

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