Technical Recommendations for the Feed-in Tariff Program

The following technical recommendations are additional proposed adjustments to the FIT Program.

PROGRAM DETAILS:

  • The OPA should allow for a window of time during which existing contracts can voluntarily withdraw from the FIT Program and have their security fees returned.
  • Provide a transition process for: (1) all pre-existing FIT applications; and (2) microFIT applications submitted on and after September 1, 2011. Allow these applications to transition to eligibility requirements in the new FIT and microFIT rules. A revised application should retain its original timestamp. The OPA should return the application and security fee, as appropriate, to any pre-existing applications.
  • The OPA should introduce a point system (see appendix 3) for small and large FIT applications:
    • That awards points to projects with minimum equity participation from an Aboriginal or local community and projects with participation by public schools, colleges, universities, hospitals or long-term care facilities.
    • That awards points to projects that have demonstrated support from the local municipalities or Aboriginal communities.
    • That awards points to water or bioenergy projects which have ancillary electricity system benefits.
    • That awards points for project readiness to wind, solar ground-mount and bioenergy projects on Aboriginal Reserve or private land where applicants have sufficient space for the project and a firm lease, firm option to lease/purchase, or ownership of the land. Solar rooftop applicants that do not own the host building should be eligible for project readiness points if they provide proof of firm site control in the form of a firm lease or option to lease.
  • The OPA should require a FIT project to earn a minimum of one point to be eligible for a contract.
  • As a priority, the OPA should work with Hydro One and other local distribution companies to implement the Minister’s directive, dated August 19, 2011, to facilitate the participation of eligible constrained microFIT projects.
  • Update the microFIT process to include an Application Approval Notice instead of a Conditional Offer of microFIT contract. Similar to the Conditional Offer, the Approval Notice will be valid for six months (see appendix 1).
  • Maintain the intent and focus of the microFIT Program:
    • Implement a limit of one microFIT contract per individual/farmer.
    • Maintain the microFIT Eligible Participant Schedule and include farm co-ops.
    • Remove requirement that Aboriginal communities, schools, public colleges, public universities, hospitals, long-term care facilities and social housing providers must own the land on which the project is to be located.
    • Consistent with the goal of keeping the microFIT Program focused on homeowners, farmers, schools and other community applicants, the Commercial FIT (CFIT) Program should not be launched.
  • For FIT and microFIT projects, additional applications on the same property (e.g. campus-style projects) at the same time should be permitted, provided that they receive the aggregated MW price. Future projects should be permitted, provided the original projects have reached commercial operation.
  • Following commercial operation, a portion of the FIT price should escalate with inflation over time (as measured by the Consumer Price Index (CPI)) to reflect ongoing operations and maintenance costs.
    • 50 per cent price of the bioenergy price adjusted for CPI
    • 20 per cent of the wind and water price adjusted for CPI
    • 0 per cent of the solar price adjusted for CPI
    • For new FIT contracts, the OPA should analyze inflationary pressures to determine if additional cost support is warranted as part of the price review this November.
  • Strengthen FIT project due diligence requirements in areas including: awareness of regulatory approvals, structural safety and application security fees for small FIT projects.
  • Create a domestic content grid for concentrated solar PV to facilitate participation in the FIT Program.
  • TRANSMISSION AND DISTRIBUTION:

  • To promote efficient use of land and connection infrastructure, the OPA should consult with stakeholders to develop a rule regarding the appropriate maximum distance between a project site and its connection point.
  • Maintain Hydro One’s technical limit for connecting micro-sized projects to its distribution system ("7 per cent rule"), pending the results of additional studies.
  • Regularly update and publish FIT transmission availability tables following, at a minimum, each round of FIT contract awards.
  • Where the OPA’s screening process indicates that upgrades are required to connect a project, the OPA should offer contracts only to projects where the need for minor transmission upgrades is identified.
  • Based on planned transmission projects and recommended changes to the FIT Program, do not proceed with the Economic Connection Test (ECT).
  • Establish best practices and processes for local distribution companies (LDCs) and transmitters that will improve communication, transparency and coordination between the OPA, LDCs, transmitters and generators regarding the Connection Impact Assessment (CIA) process and the status of applications.