Ontario Revises Proposed Feed-in Tariffs

May 13, 2009 (Revised May 19, 2009)

The Ontario Power Authority (OPA) issued revised draft feed-in tariffs at its stakeholder workshop May 12, 2009.

New tariff bands were added and tariffs increased for some technology bands. OPA also revised its proposed bonus payments for projects owned by community and aboriginal groups.

OPA, Ontario's power procurement agency, also eliminated a potentially significant barrier to financing renewable projects by reassuring investors that projects will be paid for generation foregone if economically curtailed.

Ontario is dependent on a large mix of inflexible nuclear power and with the closure of industry across the province there has been a surplus of power during the transition from winter to summer. This surplus has unsettled the investment community along Toronto's Bay Street, Canada's Wall Street.

Ontario has committed to close all its coal-fired power plants by 2014. It is the only jurisdiction in North America to make such a commitment. As a result, Ontario has embarked on an ambitious plan to become a leader in renewable energy development to make up the difference in lost power generation.

OPA has made several changes to its initial feed-in tariff proposal.

• Rooftop PV <10 kW tranche now includes ground-mounted systems
• Rooftop PV >10 kW tranche expanded to 250 kW, effectively raising the tariff for >100 kW<250 kW systems
• Ground-mounted PV cap and degression eliminated
• Hydropower is divided into two tranches and the lower tranche gets a little higher tariff
• Hydropower term extended to 40 years
• 100% inflation protection during construction, then 20%.
• Biogas tranche <500 kW added
• Community and Aboriginal bonus extended to all technologies except rooftop PV
• Aboriginal bonus raised to 1.5 cents
• Amount of community and aboriginal bonus now depends upon percent ownership interest

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