ONTARIO KNOWS THE FIT

Feed-in Tariffs: Ontario’s Experience
John Lorinc, February 10, 2009 (NY Times)

"Less than three years after the Ontario government introduced North America’s first feed-in tariff policy to promote small-scale renewable energy, [a Canadian environmentalist has suggestions]…for decision-makers in the United States…Several states and cities in the United States are considering a set of energy rate-setting policies that are regarded as pivotal in the growth of green energy in countries like Germany.

"Feed-in tariffs — also known as “standard offer contracts” — guarantee long-term preferential rates to small renewable energy developers so they can compete on price with conventional (and less costly) forms of power."

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"Beginning in March 2006, Ontario agreed to price small-scale hydro, wind and biomass projects at 11 Canadian cents ($0.9 U.S.) a kilowatt-hour, and 42 Canadian cents ($0.34 U.S.) for solar — compared to about 5 cents for nuclear, coal, gas and large hydro. The rates were guaranteed for 20 years.

"So many local wind and solar developers — as well as homeowners looking to install photovoltaic panels — applied for Ontario’s standard offer that the government’s 10-year target cap of 1,000 megawatts was exceeded within a year...The province…is expected to reintroduce a modified feed-in tariff [with its]… new green energy legislation…"

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"…Keith Stewart, an energy analyst at World Wildlife Fund Canada [suggests]…1) Don’t cap a feed-in tariff program. Governments should rely on such tariffs as the primary procurement method for green energy…2) Create a monitoring process. Under the terms of Ontario’s standard offer, developers had three years to line up financing, obtain approvals and build their projects…3) Underwrite a smart grid. To fully exploit the potential of renewable energy, transmission networks need to be re-engineered to accommodate smart meters and intermittent energy flows from solar and wind projects…

"An expert task force convened by Ontario’s electricity market operator released a report last week recommending $1.6 billion Canadian ($1.3 billion U.S.) in smart grid investments."