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Ontario Sustainable Energy Association. Presentation to the Board of Directors; Ontario Power Authority June 14, 2007. Agenda. Who Is OSEA?. Who Is OSEA?. Advanced Renewable Tariffs. Advanced Renewable Tariffs. The Standard Offer Program. The Standard Offer Program.

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ontario sustainable energy association

Ontario SustainableEnergy Association

Presentation to the

Board of Directors; Ontario Power Authority

June 14, 2007

agenda
Agenda

Who Is OSEA?

Who Is OSEA?

Advanced Renewable Tariffs

Advanced Renewable Tariffs

The Standard Offer Program

The Standard Offer Program

Comparison & Critique

Comparison & Critique

Intent of the SOC Program

Intent of the SOC Program

Moving Forward

Moving Forward

OSEA

ARTs

SOP

Critique

Intent

Future

slide4

About OSEA

  • A province-wide non-profit organization founded in 1999
  • A member-based organization
  • Currently 30 Member Organizations actively pursuing locally owned projects (Farmers, First Nations and Cooperatives)

OSEA

ARTs

SOP

Critique

Intent

Future

about osea
About OSEA
  • Education and Training
  • Policy Development
  • Initiation of new community power organizations and projects
  • Technical Assistance

OSEA

ARTs

SOP

Critique

Intent

Future

current osea members
Current OSEA Members

Walford

Thunder Bay

MoCreebec

Temagami

Bobcaygeon

Waterloo

Ottawa

Manitoulin

Melancthon

Milford

Kitchener

Lion’s Head

Perth

Tiberton

Orangeville

Kingston

Kincardine

Caledon

Dufferin

Toronto

Bervie

Newmarket

Mount Forest

Midland

Barrie

Hamilton

OSEA

ARTs

SOP

Critique

Intent

Future

osea s goals
OSEA’s Goals
  • 500 MW Community Power by 2012
  • 100% renewable energy supply in Ontario
  • Minimum 50% ownership by landowners, farmers, community organizations, local utilities, municipalities of all renewable energy generation within the Province

OSEA

ARTs

SOP

Critique

Intent

Future

osea accomplishments
OSEA Accomplishments
  • SOC Program
  • Community Power Fund
  • WWEA Conference
  • Awards
  • Grants

OSEA

ARTs

SOP

Critique

Intent

Future

community drives renewable energy
Community Drives Renewable Energy
  • 85% of wind in Denmark; 65% in the Netherlands, and 50% of wind in Germany is locally owned
    • Total installed Capacity of Wind in Germany is 20,600 MW
    • Germany is 1/3 size of Ontario and has similar wind resources
  • Ontario has ~ 400 MW of wind
  • Ontario has over 30 community power co-ops and groups
  • Ontario’s community power sector represents ~ 500 MW by 2012

OSEA

ARTs

SOP

Critique

Intent

Future

osea s arts campaign
OSEA’s ARTs Campaign
  • 2004 - OSEA launched campaign for Advanced Renewable Tariffs
  • Fall 2004 - Liberal Party Endorses ARTs
  • Winter 2004 - MoE Hires OSEA for SOC Study

OSEA

ARTs

SOP

Critique

Intent

Future

osea s arts campaign1
OSEA’s ARTs Campaign
  • Fall 2005 - MoE issues directive to OPA to develop recommendations on a SOP for Ontario
  • March 2006 - Premier announces SOC Program
  • March-October - OPA&OEB Stakeholder Workshops
  • November 2006 - SOP rules issued

OSEA

ARTs

SOP

Critique

Intent

Future

why arts
Why ARTs?
  • Community power proponents are precluded from participating in the RFP process for renewables
  • ARTs allows for broad based participation and ownership of renewable power generation
  • Simplified administrative process for government and suppliers
  • Markets with ARTs have more players, stronger local economies, more manufacturing, more jobs, more renewable energy generation
  • ARTs are a proven policy mechanism for the rapid deployment of renewable energy – Denmark, Germany, Spain, France, California

OSEA

ARTs

SOP

Critique

Intent

Future

osea s goals past and present
OSEA’s Goals (Past and Present)
  • Encourage Broad Participation
  • Eliminate Barriers to DG
  • Provide a Stable Market for RE
  • Stimulate New Investment in RE
  • Provide a Rigorous Pricing Model
  • Create a Program for All Renewables
  • Provide a Simple, Streamlined, Cost-Effective Application Process

OSEA

ARTs

SOP

Critique

Intent

Future

key components osea proposed
Key Components OSEA Proposed
  • Size (up to 10 MW) suggested cap
  • Open to all players
  • 20 year contracts
  • Price
    • set to encourage project development where there is community support and sufficient resource
      • (e.g. wind = or > 5.6 m/s)
    • specific to production and technology
  • Guaranteed access to grid
  • Pilot 2005-2010 (no cap), review in 2007

OSEA

ARTs

SOP

Critique

Intent

Future

advanced renewable tariffs osea s proposed prices
Advanced Renewable TariffsOSEA’s ProposedPrices

Paul Gipe, wind-works.org

OSEA

ARTs

SOP

Critique

Intent

Future

opa oeb program goals
OPA-OEB Program Goals
  • Be Simple
  • Remove Barriers to RE Generation
  • Balance RE Generation with Value to Ratepayers
  • Build on the Efforts of OSEA

OSEA

ARTs

SOP

Critique

Intent

Future

what we got ontario s sop
What We Got: Ontario’s SOP
  • Size (0 up to 10 MW) cap
  • Open to all players
  • Not a pilot program – no cap on program capacity
  • 20 year contract between generator and OPA
  • Standardized Prices
    • 11 cents/kWh base price (wind, hydro, bio-gas)
    • 42 cents/kWh solar PV
    • biogas and small hydro +possible 3cents for dispatchability
  • Guaranteed (Our wording or theirs – check rules) (within reason and established safety guidelines) access to the distribution grid (< 50MW? 44 kV)

OSEA

ARTs

SOP

Critique

Intent

Future

slide20

Ontario’s SOP/ARTs

  • Wind, Hydro, & Biomass: $0.11/kWh
  • Hydro & Biomass
      • $0.0352/kWh on peak
  • Solar PV: $0.42/kWh
  • Inflation Adjustment: 20%,
      • Except Solar PV (Punitive?)
  • Term: 20 years

OSEA

ARTs

SOP

Critique

Intent

Future

opa oeb value to ratepayers
OPA-OEB & “Value to Ratepayers”
  • Criterion Subject to Internal Interpretation
  • Not Part of OPA’s Mandate
  • Not Part of OSEA’s Proposal
  • Neither Spain, France, or Germany Use “Value to Ratepayers” in Determining Tariffs

OSEA

ARTs

SOP

Critique

Intent

Future

ontario s standard offer program
Ontario’s Standard Offer Program

“The Most Progressive Renewable Energy Policy in North America in Two Decades”

prices for wind energy in europe
Prices for Wind Energy in Europe

OSEA

ARTs

SOP

Critique

Intent

Future

prices paid for biomass in europe
Prices Paid for Biomass in Europe

OSEA

ARTs

SOP

Critique

Intent

Future

prices paid for solar pv in europe
Prices Paid for Solar PV in Europe

OSEA

ARTs

SOP

Critique

Intent

Future

ontario solar tariff north american comparison
Ontario Solar Tariff North American Comparison

OSEA

ARTs

SOP

Critique

Intent

Future

ontario s soc s what s wrong
Ontario’s SOC’s: What’s Wrong?

Price

  • Tariffs Too Low
    • PV: 1/2 of What’s Needed
    • Wind: Only Windy Sites
    • Biomass: $0.17 CAD/kWh MoAF
  • Inflation Adjustment Too Low
    • 20% vs 50%: -2.5% ROI
    • Excluding Solar Punitive?

Differentiation

Valuation

Transmission

Capacity

OSEA

ARTs

SOP

Critique

Intent

Future

ontario s soc s what s wrong1
Ontario’s SOC’s: What’s Wrong?

Price

  • Wind Tariff Differentiation
    • Not Enough at Less Windy Sites
    • Too Much at Windy Sites
  • Fundamental Philosophical Shift
    • Cost vs Value Debate Continues
    • Minister of Energy--Yes
    • OPA--Absolutely, Positively No!
  • Antiquated Grid
    • 7 month Hydro One Backlog!

Differentiation

Differentiation

Valuation

Valuation

Transmission

Capacity

OSEA

ARTs

SOP

Critique

Intent

Future

hydro one queue gaming
Hydro One Queue Gaming

Price

Total Generating Capacity below red line (will not be processed) is over 1,200MW, or enough to cover ~5% of Ontario’s peak capacity demand

Differentiation

Valuation

Transmission

Capacity

www.hydroonenetworks.com

OSEA

ARTs

SOP

Critique

Intent

Future

results of the of ontario s sop
Results of the of Ontario’s SOP

OSEA

ARTs

SOP

Critique

Intent

Future

ontario sop arts results
Residential PV: 150 kW?

Commercial PV: 50 MW?

~20 MW Hydro

230 MW Wind

~50 MW Installed in 2007?

~100 MW/month in Contracts

Rush for Connections

Ontario SOP/ARTs Results

(November-April 2007)

OSEA

ARTs

SOP

Critique

Intent

Future

slide34
“Through renewable energy we are also opening up opportunities for communities and, moreover, for citizens to participate in our electricity future.”

Donna Cansfield, Minister of Energy

16th National Energy Services Conference

February 6, 2006

OSEA

ARTs

SOP

Critique

Intent

Future

slide35
“Standard Offer will open up the opportunity for community-based projects to sell power to the grid.”

Donna Cansfield, Minister of Energy

16th National Energy Services Conference

February 6, 2006

OSEA

ARTs

SOP

Critique

Intent

Future

slide36
“Standard Offer for small renewable energy projects is valuable from a range of perspectives. It adds to the energy supply, it opens up the market to smaller projects … to businesses, rural landowners or farmers.”

Donna Cansfield, Minister of Energy

16th National Energy Services Conference

February 6, 2006

OSEA

ARTs

SOP

Critique

Intent

Future

slide37
“ Standard Offer is absolutely critical to smaller generators who aim to sell electricity to the grid, because it eliminates the complex bidding, assessment and quote-based competition that has discouraged investment in smaller projects.”

Donna Cansfield, Minister of Energy

Integrated Solutions to Manure Management III

March 9, 2006

OSEA

ARTs

SOP

Critique

Intent

Future

slide38
“We’re giving Ontarians, whether they be farmers, cooperatives, or small businesses – the opportunity to help strengthen our energy system, reduce our reliance on coal, and clean up our air through Ontario’s Standard Offer Program,”

Dwight Duncan, Minister of Energy

February 27, 2007

OSEA

ARTs

SOP

Critique

Intent

Future

slide39
“This represents a tremendous opportunity for farmers and our communities to build greater economic prosperity in our rural areas,” It is yet another example of how this government is acting to create jobs and a better future for rural Ontario.”

Leona Dombrowsky, Minister of Agriculture,

Food and Rural Affairs

February 27, 2007

OSEA

ARTs

SOP

Critique

Intent

Future

slide40
“We’re taking a bold new step that will allow hundreds of small, local, renewable energy producers to get into the energy market – providing cleaner energy that will help meet Ontario’s needs today – and in the future”

Premier Dalton McGuinty

March 21, 2006

OSEA

ARTs

SOP

Critique

Intent

Future

slide41
“ Until now, it was too costly and complex for small, renewable power producers — such as farmers, rural landowners, community groups, First Nations, business owners or municipalities — to sell their energy to the grid.”

Premier’s Press Release

March 21, 2006

OSEA

ARTs

SOP

Critique

Intent

Future

slide42
“ Standard Offer contracts have been the fastest and most successful way of producing renewable energy throughout the world,”

Premier Dalton McGuinty

March 21, 2006

OSEA

ARTs

SOP

Critique

Intent

Future

slide43
“ Encouraging communities to develop more renewable electricity will spur the kind of innovation in the energy sector that will help clean up our air, create jobs and contribute to our long-term prosperity.”

Premier Dalton McGuinty

March 21, 2006

OSEA

ARTs

SOP

Critique

Intent

Future

slide44
“. . . Find the right mechanism to spread the use of wind across the province.”

Minister of Energy Dwight Duncan

April 12, 2007

OSEA

ARTs

SOP

Critique

Intent

Future

slide45
“. . . We will bring the barriers down.”

Minister of Energy Dwight Duncan

April 12, 2007

OSEA

ARTs

SOP

Critique

Intent

Future

slide46
“We did it because it was the right thing to do.”

Minister of Energy Dwight Duncan

April 12, 2007

OSEA

ARTs

SOP

Critique

Intent

Future

slide48

SOC Program: What’s Next?

  • 2 Year Review (OSEA has Begun)
    • Consultation Fall 2007
    • New SOC Tariffs March, 2008

Immediate

Corrective

Action

Additions to

The SOP

General Policy

Improvements

To The SOP

OSEA

ARTs

SOP

Critique

Intent

Future

sop immediate corrective action
SOP: Immediate Corrective Action

Immediate

Corrective

Action

  • Grant priority access or set aside % capacity of distribution system for locally owned projects
  • Ease Burden on Distribution Grid
      • Lift Project Size Cap
      • Lift Voltage Cap
  • Make Locally-Owned Solar Viable
      • Raise Solar PV Tariff
  • Make On-Farm Biogas Viable
      • Raise Biogas Tariff

Additions to

The SOP

General Policy

Improvements

To The SOP

OSEA

ARTs

SOP

Critique

Intent

Future

sop immediate corrective action1
SOP: Immediate Corrective Action

Ontario Revised Solar PV Tariffs

Immediate

Corrective

Action

Additions to

The SOP

General Policy

Improvements

To The SOP

OSEA

ARTs

SOP

Critique

Intent

Future

sop immediate corrective action2
SOP: Immediate Corrective Action

Ontario Revised Biogas Tariffs

Immediate

Corrective

Action

Additions to

The SOP

General Policy

Improvements

To The SOP

OSEA

ARTs

SOP

Critique

Intent

Future

sop immediate corrective action3
To Build a Conservation Culture…… You Must Be Able to See It

Wind & Solar are the Most Visible Manifestations of Renewable Energy

Solar PV can be Deployed Most Quickly

Deploying Solar PV says: “Progress Being Made”.

SOP: Immediate Corrective Action

Ontario’s Conservation Culture

Immediate

Corrective

Action

Additions to

The SOP

General Policy

Improvements

To The SOP

OSEA

ARTs

SOP

Critique

Intent

Future

slide53

SOC Program: What’s Next?

  • Revisit
      • Prices
      • Increase Differentiation
      • Differentiated Tariffs for Wind
      • Inflation Indexing (60%)
  • Add Offshore Wind
  • Add Solar Thermal

Immediate

Corrective

Action

Additions to

The SOP

General Policy

Improvements

To The SOP

OSEA

ARTs

SOP

Critique

Intent

Future

soc program solar thermal
SOC Program: Solar Thermal

Immediate

Corrective

Action

  • Germany
      • Proposed Wärme Gesetz
      • Costs Spread Across Heating Oil & Gas
  • Monitoring Technology Exists

Additions to

The SOP

General Policy

Improvements

To The SOP

OSEA

ARTs

SOP

Critique

Intent

Future

soc program what s next
SOC Program: What’s Next?

Immediate

Corrective

Action

  • Lift Voltage Cap
    • Transmission Voltages
  • Lift Project Size Cap
    • 50 MW?
  • Priority Access
    • Farmers, First Nations, Co-ops?
  • Priority Purchase
    • Renewables before Nuclear & Fossil Fuels

Additions to

The SOP

General Policy

Improvements

To The SOP

OSEA

ARTs

SOP

Critique

Intent

Future

replicating the ontario model
Replicating The “Ontario” Model
  • Official
    • BC, Saskatchewan, Manitoba
  • Unofficial
    • Québec, Nova Scotia, Michigan?

OSEA

ARTs

SOP

Critique

Intent

Future

advanced renewable tariffs
Advanced Renewable Tariffs
  • Deliver More Capacity
    • More Quickly
    • More Equitably

OSEA

ARTs

SOP

Critique

Intent

Future

arts a question of equity
Feed Laws are Fair

Nearly All Can Play

Farmers, Ranchers, First Nations, & Co-ops

ARTs: A Question of Equity

OSEA

ARTs

SOP

Critique

Intent

Future

renewables
Renewables…
  • When You Look Closely . . .. . . Worth Every Cent
thank you
Thank you!

Paul GipeRenewable Energy Consultant, OSEA

Deb DoncasterExecutive Director,OSEA

To contact OSEA:

416-977-4441 or [email protected]

www.ontario-sea.org

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