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Ontario Sustainable Energy Association Presentation to the Board of Directors; Ontario Power Authority June 14, 2007 Presentation to the Board of Directors;

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Presentation on theme: "Ontario Sustainable Energy Association Presentation to the Board of Directors; Ontario Power Authority June 14, 2007 Presentation to the Board of Directors;"— Presentation transcript:

1 Ontario Sustainable Energy Association Presentation to the Board of Directors; Ontario Power Authority June 14, 2007 Presentation to the Board of Directors; Ontario Power Authority June 14, 2007

2 Agenda Who Is OSEA? Advanced Renewable Tariffs The Standard Offer Program Comparison & Critique Intent of the SOC Program Moving Forward Who Is OSEA? Advanced Renewable Tariffs The Standard Offer Program Comparison & Critique Intent of the SOC Program Moving Forward OSEAARTsSOPCritiqueIntentFuture

3 WHO IS OSEA? (Deb Doncaster)

4 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) 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) OSEAARTsSOPCritiqueIntentFuture

5 Current OSEA Members Manitoulin Lions Head Tiberton Kincardine Bervie Toronto Mount Forest Melancthon Waterloo Kitchener Hamilton Caledon Orangeville Dufferin Newmarket Barrie Midland Bobcaygeon Ottawa Milford Kingston Perth Temagami Walford MoCreebecThunder Bay OSEAARTsSOPCritiqueIntentFuture

6 OSEAs Goals 500 MW Community Power 100% Renewables Minimum 50% Local Ownership 500 MW Community Power 100% Renewables Minimum 50% Local Ownership OSEAARTsSOPCritiqueIntentFuture

7 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 22,600 MW Germany is 1/3 size of Ontario and has similar wind resources Ontario has ~ 400 MW of wind 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 22,600 MW Germany is 1/3 size of Ontario and has similar wind resources Ontario has ~ 400 MW of wind OSEAARTsSOPCritiqueIntentFuture

8 Advanced Renewable Tariffs: The Origin of ARTs in Ontario (Deb Doncaster)

9 OSEAs ARTs Campaign OSEA launched campaign for Advanced Renewable Tariffs Fall Liberal Party Endorses ARTs Winter 2004 – Ministry of Energy Contracts OSEA for ARTs Policy Study OSEA launched campaign for Advanced Renewable Tariffs Fall Liberal Party Endorses ARTs Winter 2004 – Ministry of Energy Contracts OSEA for ARTs Policy Study OSEAARTsSOPCritiqueIntentFuture

10 OSEAs ARTs Campaign Fall 2005 – Ministry of Energy issues directive to OPA to develop recommendations for a SOP for Ontario March Premier announces SOC Program March-October - OPA&OEB Stakeholder Workshops November SOP rules issued Fall 2005 – Ministry of Energy issues directive to OPA to develop recommendations for a SOP for Ontario March Premier announces SOC Program March-October - OPA&OEB Stakeholder Workshops November SOP rules issued OSEAARTsSOPCritiqueIntentFuture

11 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 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 OSEAARTsSOPCritiqueIntentFuture

12 What We Got: The Ontario Standard Offer Program (Deb Doncaster)

13 10 MW Project Cap Open to all players 20 year contracts Price specific to production and technology Solar: 63-84c/kWh Hydro & BioGas: 13.3 c/kWh Wind: differentiated pricing ranging from 13.3 c/kWh – 6.9 c/kWh 80% Inflation Indexing Guaranteed access to grid Anti-Gaming Policy 10 MW Project Cap Open to all players 20 year contracts Price specific to production and technology Solar: 63-84c/kWh Hydro & BioGas: 13.3 c/kWh Wind: differentiated pricing ranging from 13.3 c/kWh – 6.9 c/kWh 80% Inflation Indexing Guaranteed access to grid Anti-Gaming Policy Standardized Prices 11 cents/kWh base price (wind, hydro, bio-gas) 42 cents/kWh solar PV biogas and small hydro cents 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 Components OSEAARTsSOPCritiqueIntentFuture

14 OPA-OEB & Value to Ratepayers Criterion Subject to Internal Interpretation Not Part of OPAs Mandate Not Part of OSEAs Proposal Neither Spain, France, or Germany Use Value to Ratepayers in Determining Tariffs Criterion Subject to Internal Interpretation Not Part of OPAs Mandate Not Part of OSEAs Proposal Neither Spain, France, or Germany Use Value to Ratepayers in Determining Tariffs OSEAARTsSOPCritiqueIntentFuture

15 Comparison and Critique of Ontarios SOP - PG (Paul Gipe)

16 Ontarios Standard Offer Program The Most Progressive Renewable Energy Policy in North America in Two Decades OSEAARTsSOPCritiqueIntentFuture

17 Prices for Wind Energy in Europe OSEAARTsSOPCritiqueIntentFuture

18 Prices Paid for Biomass in Europe OSEAARTsSOPCritiqueIntentFuture

19 Prices Paid for Solar PV in Europe OSEAARTsSOPCritiqueIntentFuture

20 Ontario Solar Tariff North American Comparison OSEAARTsSOPCritiqueIntentFuture

21 Ontarios SOCs: Whats Wrong? Tariffs Too Low PV: 1/2 of Whats Needed Wind: Only Windy Sites Biomass: $0.17 CAD/kWh MoAF Inflation Adjustment Too Low 20% vs 50%: -2.5% ROI Excluding Solar Punitive? Tariffs Too Low PV: 1/2 of Whats 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 Transmission Capacity Price OSEAARTsSOPCritiqueIntentFuture

22 Price Ontarios SOCs: Whats Wrong? Wind Tariff Differentiation Based on Wind Resource; Specific to Resource and Technology Wind Tariff Differentiation Based on Wind Resource; Specific to Resource and Technology OSEAARTsSOPCritiqueIntentFuture Differentiation Transmission Capacity Price Differentiation

23 Price Hydro One Queue Gaming Antiquated Grid 7 month Hydro One Backlog No Anti-Gaming Provision in SOP No Policy Mechanism for Larger Transmission- Connected Projects Community & Locally- Owned Projects are left out of the SOP Antiquated Grid 7 month Hydro One Backlog No Anti-Gaming Provision in SOP No Policy Mechanism for Larger Transmission- Connected Projects Community & Locally- Owned Projects are left out of the SOP Differentiation Transmission Capacity Differentiation Transmission Capacity

24 Results of the of Ontarios SOP (Paul Gipe)

25 Ontario SOP/ARTs Results Residential PV: 150 kW? Commercial PV: 50 MW? ~20 MW Hydro 230 MW Wind 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 May 16: 396MW of Contracts Signed (November-April 2007) OSEAARTsSOPCritiqueIntentFuture

26 A Disconnect Between Intent, Policy and Implementation (Paul Gipe)

27 Standard Offer will open up the opportunity for community-based projects to sell power to the grid. 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 16 th National Energy Services Conference February 6, 2006 Standard Offer will open up the opportunity for community-based projects to sell power to the grid. 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 16 th National Energy Services Conference February 6, 2006 OSEAARTsSOPCritiqueIntentFuture

28 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 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 OSEAARTsSOPCritiqueIntentFuture

29 Were 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 Ontarios Standard Offer Program, Dwight Duncan, Minister of Energy February 27, 2007 Were 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 Ontarios Standard Offer Program, Dwight Duncan, Minister of Energy February 27, 2007 OSEAARTsSOPCritiqueIntentFuture

30 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 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 OSEAARTsSOPCritiqueIntentFuture

31 Were 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 Ontarios needs today – and in the future Premier Dalton McGuinty March 21, 2006 Were 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 Ontarios needs today – and in the future Premier Dalton McGuinty March 21, 2006 OSEAARTsSOPCritiqueIntentFuture

32 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. Premiers Press Release March 21, 2006 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. Premiers Press Release March 21, 2006 OSEAARTsSOPCritiqueIntentFuture

33 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 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 OSEAARTsSOPCritiqueIntentFuture

34 ... We need a good quote. Minister of Energy Dwight Duncan Growing the Margins Conference April 12, We need a good quote. Minister of Energy Dwight Duncan Growing the Margins Conference April 12, 2007 OSEAARTsSOPCritiqueIntentFuture

35 Going Forward (Paul Gipe)

36 2 Year Review (OSEA has Begun) Consultation Fall 2007 New SOC Tariffs March, 2008 SOC Program: Whats Next? OSEAARTsSOPCritiqueIntentFutureImmediate ActionDetailsGeneral

37 SOP: Immediate Action 1.Grant priority access or set aside % capacity of distribution system for locally owned projects 2.Ease Burden on Distribution Grid Lift Project Size Cap Lift Voltage Cap 3.Make Locally-Owned Solar Viable Raise Solar PV Tariff 4.Make On-Farm Biogas Viable Raise Biogas Tariff 1.Grant priority access or set aside % capacity of distribution system for locally owned projects 2.Ease Burden on Distribution Grid Lift Project Size Cap Lift Voltage Cap 3.Make Locally-Owned Solar Viable Raise Solar PV Tariff 4.Make On-Farm Biogas Viable Raise Biogas Tariff FutureImmediate ActionDetailsGeneral

38 SOP: Details of Price Revision Ontario Revised Solar PV Tariffs FutureImmediate ActionDetailsGeneral

39 SOP: Details of Price Revision Ontario Revised On-Farm Biogas Tariffs FutureImmediate ActionDetailsGeneral

40 SOP: Further Details on Revision 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. 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. Ontarios Conservation Culture FutureImmediate ActionDetailsGeneral

41 Revisit Prices Increase Differentiation Differentiated Tariffs for Wind Inflation Indexing (60%) Add Offshore Wind Add Solar Thermal SOC Program: Whats Next? FutureImmediate ActionDetailsGeneral

42 SOC Program: Solar Thermal Germany Proposed Wärme Gesetz Costs Spread Across Heating Oil & Gas Monitoring Technology Exists Germany Proposed Wärme Gesetz Costs Spread Across Heating Oil & Gas Monitoring Technology Exists FutureImmediate ActionDetailsGeneral

43 SOC Program: Whats Next? Priority Purchase Renewables before Nuclear & Fossil Fuels Streamlining the Process Chief Renewable Energy Officer for Ontario Priority Purchase Renewables before Nuclear & Fossil Fuels Streamlining the Process Chief Renewable Energy Officer for Ontario FutureImmediate ActionDetailsGeneral

44 Replicating The Ontario Model Official BC, Saskatchewan, Manitoba Unofficial Québec, Nova Scotia, Michigan? Official BC, Saskatchewan, Manitoba Unofficial Québec, Nova Scotia, Michigan? OSEAARTsSOPCritiqueIntentFutureImmediate ActionDetailsGeneral

45 Advanced Renewable Tariffs Deliver More Capacity More Quickly More Equitably Deliver More Capacity More Quickly More Equitably OSEAARTsSOPCritiqueIntentFuture

46 ARTs: A Question of Equity Feed Laws are Fair Nearly All Can Play Farmers, Ranchers, First Nations, & Co-ops OSEAARTsSOPCritiqueIntentFuture

47 No Time for Half Measures … No Time to Lose

48 Renewables… Standard Offer contracts have been the fastest and most successful way of producing renewable energy throughout the world Premier Dalton McGuinty March 21, 2006 Standard Offer contracts have been the fastest and most successful way of producing renewable energy throughout the world Premier Dalton McGuinty March 21, 2006

49 Thank you! To contact OSEA: or Paul Gipe Renewable Energy Consultant, OSEA Deb Doncaster Executive Director, OSEA Questions Regarding: Immediate Action Required OSEA Pricing Proposal Ontarios SOC: Whats Wrong? General Policies Moving Forward


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