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Ontario Sustainable Energy Association

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

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

  2. 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

  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) OSEA ARTs SOP Critique Intent Future

  5. 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

  6. OSEA’s Goals • 500 MW Community Power • 100% Renewables • Minimum 50% Local Ownership OSEA ARTs SOP Critique Intent Future

  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 OSEA ARTs SOP Critique Intent Future

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

  9. OSEA’s ARTs Campaign • 2004 - OSEA launched campaign for Advanced Renewable Tariffs • Fall 2004 - Liberal Party Endorses ARTs • Winter 2004 – Ministry of Energy Contracts OSEA for ARTs Policy Study OSEA ARTs SOP Critique Intent Future

  10. OSEA’s ARTs Campaign • Fall 2005 – Ministry of Energy issues directive to OPA to develop recommendations for 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

  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 OSEA ARTs SOP Critique Intent Future

  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 Standardized Prices 11 cents/kWh base price (wind, hydro, bio-gas) 42 cents/kWh solar PV biogas and small hydro + 3.5 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 OSEA ARTs SOP Critique Intent Future

  14. 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

  15. Comparison and Critique of Ontario’s SOP - PG (Paul Gipe)

  16. Ontario’s Standard Offer Program “The Most Progressive Renewable Energy Policy in North America in Two Decades” OSEA ARTs SOP Critique Intent Future

  17. Prices for Wind Energy in Europe OSEA ARTs SOP Critique Intent Future

  18. Prices Paid for Biomass in Europe OSEA ARTs SOP Critique Intent Future

  19. Prices Paid for Solar PV in Europe OSEA ARTs SOP Critique Intent Future

  20. Ontario Solar Tariff North American Comparison OSEA ARTs SOP Critique Intent Future

  21. Ontario’s SOC’s: What’s Wrong? • 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? Price Differentiation Transmission Capacity OSEA ARTs SOP Critique Intent Future

  22. Ontario’s SOC’s: What’s Wrong? • Wind Tariff Differentiation • Based on Wind Resource; • Specific to Resource and Technology Price Price Differentiation Differentiation Transmission Capacity OSEA ARTs SOP Critique Intent Future

  23. 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 Hydro One Queue Gaming Price Differentiation Differentiation Transmission Capacity Transmission Capacity

  24. Results of the of Ontario’s SOP (Paul Gipe)

  25. 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 Ontario SOP/ARTs Results (November-April 2007) OSEA ARTs SOP Critique Intent Future

  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 16th National Energy Services Conference February 6, 2006 OSEA ARTs SOP Critique Intent Future

  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 OSEA ARTs SOP Critique Intent Future

  29. “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

  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 OSEA ARTs SOP Critique Intent Future

  31. “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

  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.” Premier’s Press Release March 21, 2006 OSEA ARTs SOP Critique Intent Future

  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 OSEA ARTs SOP Critique Intent Future

  34. “. . . We need a good quote.” Minister of Energy Dwight Duncan Growing the Margins Conference April 12, 2007 OSEA ARTs SOP Critique Intent Future

  35. Going Forward (Paul Gipe)

  36. SOC Program: What’s Next? • 2 Year Review (OSEA has Begun) • Consultation Fall 2007 • New SOC Tariffs March, 2008 OSEA ARTs Immediate Action SOP Critique Details Intent General Future

  37. SOP: Immediate 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 Future Immediate Action Details General

  38. SOP: Details of Price Revision Ontario Revised Solar PV Tariffs Future Immediate Action Details General

  39. SOP: Details of Price Revision Ontario Revised On-Farm Biogas Tariffs Future Immediate Action Details General

  40. 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: Further Details on Revision Ontario’s Conservation Culture Future Immediate Action Details General

  41. SOC Program: What’s Next? • Revisit • Prices • Increase Differentiation • Differentiated Tariffs for Wind • Inflation Indexing (60%) • Add Offshore Wind • Add Solar Thermal Future Immediate Action Details General

  42. SOC Program: Solar Thermal • Germany • Proposed Wärme Gesetz • Costs Spread Across Heating Oil & Gas • MonitoringTechnologyExists Future Immediate Action Details General

  43. SOC Program: What’s Next? • Priority Purchase • Renewables before Nuclear & Fossil Fuels • Streamlining the Process • Chief Renewable Energy Officer for Ontario Future Immediate Action Details General

  44. Replicating The “Ontario” Model • Official • BC, Saskatchewan, Manitoba • Unofficial • Québec, Nova Scotia, Michigan? OSEA ARTs Immediate Action SOP Critique Details Intent General Future

  45. Advanced Renewable Tariffs • Deliver More Capacity • More Quickly • More Equitably OSEA ARTs SOP Critique Intent Future

  46. 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

  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

  49. Thank you! Paul GipeRenewable Energy Consultant, OSEA Deb DoncasterExecutive Director,OSEA Questions Regarding: To contact OSEA: 416-977-4441 or info@ontario-sea.org www.ontario-sea.org Immediate Action Required OSEA Pricing Proposal Ontario’s SOC: What’s Wrong? General Policies Moving Forward

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