Ontario’s government announced today that it will implement all of the recommendations of the first review of its Feed-in-Tariff (FIT) Program (Review)
As widely anticipated, there are substantial reductions in the FIT rates payable for solar and wind-powered renewable energy generation. Prices for water, biogas, biomass and landfill gas will remain at current levels. FIT rates will now be reviewed annually and there will be a review at the end of 2013 to see if a higher renewables capacity target is warranted.
The Review has responded positively to overtures made by advocates of community and Aboriginal participation in the program, recommending a 10 percent set-aside of remaining capacity for projects with significant participation from local or Aboriginal communities.
Municipalities will be pleased or disappointed with the Review depending or their support of or opposition to renewable energy projects in their locality.
Those municipalities hoping for a restoration of some of their planning powers over renewable energy projects have to make do with commitments to increased engagement and clarification of project siting requirements. By contrast, renewable energy projects with municipal support will be prioritized through the new point system during the application review process.
The Review reiterates the government’s commitment to developing a smart grid and gives a nod of approval to the future development and adoption of electricity storage technology.
The Review of the FIT Program makes strategic recommendations in six areas:
1. Continue Commitment to Clean Energy
- Beginning this year, the province will conduct an annual review of FIT prices – setting and publishing prices each November, effective Jan. 1st the following year.
- As the program moves forward, Ontario expects to procure its target of 10,700 MW of non-hydro renewable energy generation by 2015.
- At the end of 2013, the government will review Ontario’s electricity supply and demand forecast to explore whether a higher renewables capacity target is warranted.
2. Streamline processes and create jobs
- Ontario should improve the regulatory approvals process, while maintaining the highest environmental protection standards.
- The province will create a new Renewable Energy Committee to help regulatory ministries reduce duplication, improve service standards and streamline the process – shortening the application process by up to 25 per cent.
- The Ministry of Natural Resources will review and update its approach to renewable energy development on Crown land to align the release of Crown land with provincial energy supply needs and transmission availability.
3. Encourage greater community and Aboriginal participation
- The province will reserve a minimum of 10 per cent of the remaining FIT contract capacity for projects with significant community and Aboriginal participation.
- The new program will also prioritize large and small FIT applications using a point-system that will award additional points to projects that have significant local and/or Aboriginal involvement.
4. Improve municipal engagement
- Under the new rules, large FIT projects will require a contract launch meeting with the municipality, proponent, project developer, government, utility, and agency to facilitate early discussion, share information and define expectations.
- Projects with municipal support will be prioritized through the new point system during the application review process.
- The province will clarify project-siting rules by removing all exemptions and strengthening the protection of prime agricultural lands.
- The Association of Municipalities of Ontario (AMO) will work with the Ministry of Energy to revise the municipal consultation form in the Renewable Energy Approval process.
5. Reduce prices to reflect lower costs
- FIT prices will be reduced by more than 20 per cent for solar and approximately 15 per cent for wind.
- Prices for water, biogas, biomass and landfill gas will remain at current levels.
6. Expand Ontario’s clean energy economy
- The Ministry of Energy and the Ministry of Economic Development and Innovation will develop a Clean Energy Economic Development Strategy that will build on Ontario’s strengths and leverage its experience as a leader in the sector.
- Future international expansion by the most innovative and competitive companies in Ontario will be the key to long-term industry growth.