I heard that part of the reason the OPA decided to reduce the rate on ground mounted solar was that some companies had applied for thousands of microFIT contracts along rural roads where the existing hydro infrastructure could not accept the capacity. This would mean large costs to upgrade the system.

I can appreciate that the OPA wanted to streamline the application process, so they left the LDCs (local hydro distribution companies) out of the application loop. If they now include them, they can simply restrict application approvals, based on system capacity. This would limit what individuals and companies apply for. Reducing the rate to all applicants is simply unfair.

I have a rural customer that wanted to put 10kW on their property, but could only put 5kW on their roof, so they thought to put the additional 5kW on the ground. Now that the reduced rate is proposed, half of their production will be at 26% less, and that portion will cost more to install. So what do you think they did? Yes there is going to be another 5kW less green energy produced in Ontario. This on its own is not significant, but combined with everyone else that feels the same, the impact to the program will be substantial.

The current rate reduction solution to whatever the full reasons to propose it should be reconsidered to address the actual cause.

I also have a problem with the argument that the profits earned at the old rate are excessive and could compromise the program. I think the OPA needs to start looking at the real cost of our current energy production methods verses green energy produced by whatever means we can.

If the OPA had to pay to clean up 100% of the pollution created every time we turn on a coal fired power plant, what would the cost of our electricity be? What if theye were responsible for the polution created on the electricty we buy outside of the province as well? If the OPA had to pay the full cost of totally eliminating the nuclear waste that is produced by our nuclear plants, or if the full cost of building the nuclear plant (including R&D or whatever other hidden costs are paid by taxpayers) was calculated into our electricity costs, what would we be paying for power?

The cost that the OPA pays us for the green energy we produce covers all of this. There is no pollution to cleanup, no hidden costs that we pay through taxes, it is just the cost that the OPA determined they could pay participants in the program, for the clean energy they produced.

The rate reduction is not the solution, so fix it properly and lets get producing green energy.

I wish I could have attended the OPA web/teleconference sessions about the proposed new rate category for ground mounted solar. I hear I missed hours of complaints by former microFIT supporters.

I did my part however and sent emails to my MPP, the minister and the OPA. I wish that I felt better knowing I have done this, but I am concerned that my comments will fall on deaf ears.

I wish the OPA and the Minister could hear what I hear everyday as I am talking with potential customers. I am unable to provide reassurance to my clients concerns about the program, because I honestly do not have any confidence in it myself anymore. The OPA has shown that it has no interest in what the public thinks, as they make a decision and implement it, then ask what we think.

I think we need a new government, or at the very least, we need to bring back the Minister that started the ball rolling, so that he can fix it, before it is too late. Regrettably I think that  Brad Duguid needs to resign and George Smitherman should be brought back to add his credibility to try and save the program.

This may save Ontario, but even this is a long shot....

Many emails from customers and prospective ones, along with concerned visitors has prompted me to add commenting to my blog. Share your thoughts and what you are doing to let the ministry and the OPA know what you think of the proposed rate change.

Here are some things you can do:

• John Gerretsen is the Kingston & Islands MPP. If you are in his area, let him know what you think. If you are outside of his area, send a message to your own MPP: http://www.johngerretsen.onmpp.ca/
• You can now post your thoughts and comments on my blog, available at the bottom of every page. There are hundreds of people that are reading this website, let them know how you feel as well.
• Send an email to the OPA and attend their discussion sessions as indicated in the email they sent you.: http://microfit.powerauthority.on.ca/contact-us.php
• Email the Minister of Energy & Infrastructure - Brad Duguid who oversees all of this: Ministry - Contact Us

This is wrong, so let's let them know how we feel.

This is really hard to write, because back on June 4th I blogged about how the industry should empathize with the OPA's situation having thousands of applications to process, and how we should be appreciative of the opportunity they offered us.

Over the last few days, I have really done an about face, because I now understand that the delays were not due to application volume, they were due to the OPA planning to screw the applicants of the microFIT program. I was blindly supporting the OPA based on a trust that they were really interested in the Green energy program that they were promoting succeed. Today I understand that this is not the case.

So to all those that saw through the veil of crap that the OPA was feeding us, I say that I am sorry for having believed the propaganda. You were right to call the OPA on this, and I was fooled.

Shame on me.

Today another manufacturer told me of $55 million in sales lost to the OPA change in microFIT ground mounted pricing. This is just a sign of news I expect to hear more about from within the industry as time goes on.

Unfortunately I don't believe that the OPA understands the severity nor the full implications of their proposed rate change. If this goes through, the OPA and the Ministry of Energy and Infrastructure will loose all credibility within the solar industry.

Many people in the industry assumed that rates would change when the planned 2 year review took place, but for the OPA to decide to change the rate, because people are expected to (in their estimation) earn too much from ground mount installations says, we'll lower your rates, whenever we want, without consideration for your plans.

I am not sure how FIT sized projects can assure their investors that they they will earn a reasonable return, when the OPA could change their rate at anytime. I also don't know how microFIT project developers could make plans to proceed, when the rate may change again tomorrow.

Every project takes time and money to develop, and now no one can proceed on a project because there is no assurance that any rate will be available before they get their contract offer. We cannot make plans, discuss income projections with banks and financiers, because everything we plan could change tomorrow. No longer is the fact that we have applied any assurance that we can make plans, we will need to wait and see what the rate will be when we finally see the OPA offer.

And what if the OPA would say, go ahead, make your plans, everything is good to go. Who will believe them after a rate change? The fact that they did not even say that all the applications in the system would qualify at the rate they applied at, no they said that only those they had approved would get that rate. This is further unsettling news. The fact that, our applications have been we held up for 3-4 months, is just our tough luck, all we can expect is today's rate, or tomorrow's rate or whatever rate we decide to offer when we finally get around to processing your application.

Oh, and another thing. When the OPA states that we will process your application in 30 days, that's just crap too, because we will really process your application whenever we want, so that it suits their plans. And don't forget, that the rate you apply at, really has no relevance on what rate you will get. We just make them up so that we can lure you, and international manufacturers into our province. The OPA obviously has no consideration for anyone's plans, just their own.

I have tried to teach my children as they grow up, to understand what an important thing trust is. We begin relationships trusting one another, but when one person breaks the trust, it takes a very long time before the other party begins to trust again. While the OPA stated that they could change the program at anytime, no one could have guessed that they would lower a rate because we would be making too much money, doing what they said. To me, this is a trust broken, and I am sure that many others that were making plans on developing microFIT projects based on trust in the continuance of the program during the first 2 years, feel betrayed as well.

I urge you to share these feelings with your MP. I don't think that the government should feel that their betraying our trust is something we will let happen without an issue.

Faster than the solar industry is built in Ontario, it begins to fall apart.

Today we lost over a million dollars in business because yesterday, the OPA proposed a rate reduction for ground mounted microFIT projects. This was no small drop, this was not an expected drop during their 2 year program review, this was over 26% out of the blue!

The claim is that in keeping with the spirit of the program, they needed to reduce the rate for the program to be sustainable. Translated this means that because you and I have worked hard over the last 9 months to bring the cost of solar down so that we can make a decent return on the second largest investment most will make during their lifetime (besides buying a house) that we would be earning too much. Because of our efforts, the OPA is reducing our potential income by 26% percent!

The ripple effects throughout the Ontario solar industry are expected to be huge. How can a manufacturer consider investing in setting up a manufacturing facility in Ontario, when they cannot even rely on the government to continue a program on the time-line they have laid out? How can a manufacturer plan to be in any long term business, that will really benefit Ontario, when the OPA along with the support of Ministry of Energy and Infrastructure have chosen to change the program in its infancy.

They will not. There will be no long term benefit to the people of Ontario. What will happen is that a few mobile manufacturing facilities will setup in the province to suck out as much business as they can, then when the program has been totally devastated by the OPA and the Ministry of Energy and Infrastructure, they will leave. 

What we will have done is paid foreign companies for the products that we buy, and we will pay foreign companies for the green energy that they supply us for the next 20 years. Colin Anderson of the OPA and Brad Duguid the minister in charge of Energy and Infrastructure should rethink their proposal. Tell them what you think!

Hopefully it's not too late to salvage the industry, but I have my reservations.

Today the OPA announced a new rate of 58.8¢/kW for ground mounted microFIT installations citing the success of the program (lots of applications), with the majority of them being ground mounted as the reason. They go on to say that for the program to be sustainable, the new rate for lesser costing ground mount projects be reduced, but that it will still offer future project owners to recover cost and earn a reasonable return over the long term. In addition they cite that the program was designed on the principal of a reasonable rate of return.

They go on to say that the Ministry of Energy and Infrastructure supports this decision because it ensures that the microFIT Program is meeting its program goals and is providing proper value to generators and ratepayers. The OPA believes it is in the best long-term, sustainable interests of the program, generators and ratepayers that a proposed new price category be created now so the program can realize the value it was intended to deliver.

What crap!

First of all, the program is not a success, unless the purpose of the program was to collect a few applications. Maybe as the OPA chose not to impose any fee to apply, their purpose was only to collect applications, if so then the program has been a moderate success. I would not say that in a province with over 12 million people living in it, having only 16,000 applications would constitute a success. To put it in perspective, this is akin to the city of Cobourg applying for microFIT applications, not Toronto, Ottawa, Hamilton, Windsor, Thuinder Bay, etc.

The next question is, how many of these applications have been connected to the grid? This to me would be the true indication of success of a program. How many thousands of microFIT producers are connected up right now? I have spoken to many people in the industry and we expect that only about 30% or less of the applicants will actually connect to the grid. This would bring the number of microFIT projects down to about 4,800 given the number of applications. So although a city the size of Cobourg may have applied, less than 1 in 3 is expected to follow through. This is because the cost of solar PV is so high. So is this the success of the program that the OPA is claiming, that less than 1 in 3 people in a city the size of Cobourg connect to the grid, out of the whole province of Ontario?

And what about the cost factor cited as the reason for a lower rate for ground installation? I am not sure about other installation companies, but it costs more for a ground mount system here than a rooftop system. Our rooftop system is the least expensive system we sell, so how does the OPA come up with this information? If a generator (this is what you are referred to by the OPA if you sell power to them) builds their own racking out of say wood (that will last 20 years, ha) and screws on their own panels, and connects up their own wiring, it would cost less than a rooftop system. If this is how they determine that it costs less, than I wonder why they should penalize the hard working people of Ontario that try and do it themselves, to be able to afford a system, by lowering the rate. This lower rate translates into about $60,000 less over the 20 year contract on a 10kW ground mounted system. I would like to know how someone building a system themselves could save $60,000.

And why should the rate for a microFIT on the ground be any different than microFIT on a roof? An individual is already limited to a microFIT sized project, so why should they restrict the rate as well? Didn't they plan for this when they determined the system size and rate?

I have been receiving a number of comments from customers, prospects and manufacturers as a result of this announcement. Customers are wondering why they are being penalized for planing a ground mounted system, while manufacturers are saying that in addition to the problems caused by the OPA's inability to process applications on the time-line they stated, this lower rate will kill ground mount microFIT projects.

When I started this business, I thought that this provided Ontarians a good opportunity to participate in producing Green Energy for the province. While microFIT projects do not produce more than what 1 – 1.5 typical households consume, the fact that we could participate and earn a very conservative business income made this an appealing investment. Backed by a Government contract for 20 years, assured participants that they could recover their investment. Now they are changing the rules, even before the program reaches their own stated 2 year review.

Is the OPA trying to sabotage green energy production in Ontario? Most residential rooftops cannot accommodate a 10 kW system, which means that only ground mounted systems could produce this. Does this mean that they really don't want to produce green energy, or do they just not want to have individuals produce this? The government has been very quick to announce large scale PV and renewable energy projects, with foreign companies. This is not great, because what they are doing is selling off the opportunity for Ontarians to benefit, in exchange for green volume from foreigners. I don' t think that this spells success for Ontario.

I expect that this will also limit PV solar manufacturing moving into Ontario. With a 60% domestic content requirement coming into effect in January 2011, I was looking forward to seeing new industry open in Ontario. The fact that a majority of applications will now never be completed, should cause manufacturers to take a hard look at opening factories here. I know that if I were a manufacturer and I saw that the government thought that 16,000 applications were too many, I wouldn't open up here. There isn't enough business today, nor enough coming tomorrow to warrant it. I urge you to contact your local MP about this decision. It affects not only today's generators, but Ontario's future Green economy as well. If the majority of microFIT applications are for ground mounted systems, and the OPA killed ground mounted microFIT projects by lowering the rate, what then will continue this Green economy? If we aren't placing orders, we aren't buying parts, and we aren't making parts, so we aren't employing people to build them or install them.

Ask your MP to request that the OPA keep their rate structure for the first 2 years, then assess the number of microFIT connections, before they determine the impact that the current rate structure has. At least they can let the industry get started, before they kill it.

I regularly have competitors calling me up about my prices and services, but pretending to be prospective customers. There is so much business to be done in this industry, that I do not have an issue sharing my knowledge with my competitors, so don't be afraid to identify yourself. I think that as an industry, we can improve ourselves by sharing information, which ultimately helps out our customers. This is good! This is one of the reasons why I post information about the products I offer and the suppliers I work with. They are not unique to me, but they are companies and products that I have researched and feel are a good value for my customers, and they can be for your customers as well.

Here is something to consider, if we work together, we could potentially get even better prices on the things we offer our customers! So give me a call or shoot me an email. When we are down to the last two customers left in Ontario, we can be worried about who gets their business. Until then, let's figure out how we can get our customers' the best system, at the best price, installed the best and safest way, with the best warranty and warranty service they could ever ask for.

The RST (provincial tax) rebate and HRTC (Home Renovation Tax Credit) are coming to an end by January 2010. To be eligible to get these refunds and credits, your solar system needs to be purchased and installed before February.

Both the Canadian and Ontario Governments are willing to pay you thousands of dollars to add a solar system to your home, that will also pay you thousands of dollars in guaranteed revenue for the next 20 years. You do not have to spend any money out of pocket as many financial institutions will finance the system 100%.

You can begin earning money right away, and benefit for the refunds and tax savings, but you need to act quickly. Call or contact us today to discuss exactly how much you will save and earn.

Download PDF

PST Information Notice, May 2003

As announced in the 2007 Ontario Budget, the rebate has been extended for qualifying alternative energy systems that are purchased and installed in residential premises, including multi-residential buildings, before January 1, 2010. Please see RST Information Notice, Highlights from the 2007 Ontario Budget - Retail Sales Tax Act for further details.

About this Notice

This Notice explains how you can receive a rebate of Retail Sales Tax (RST) paid on the purchase of a new solar energy system installed into a residential premises, including a multi-residential building, or on any expansion or upgrade to an existing solar energy system.

Background

As part of the Electricity Pricing, Conservation and Supply Act, 2002, the Ontario government introduced the rebate for RST paid on the purchase of a new solar energy system installed into a residential premises, including a multi-residential building, or on any expansion or upgrade to an existing solar energy system.

Qualifying Criteria

For purposes of the rebate, a solar energy system includes:

• a solar photovoltaic system that converts solar energy into electricity, or
• a solar thermal system that converts energy into heat.

A solar photovoltaic system includes:

• the solar photovoltaic collector panels, wiring, controllers and devices that convert direct current into alternate current, and
• the first battery used to store the energy produced by the system.

A solar thermal system includes:

• the solar thermal collector panels, wiring, pumps, tubing, heat exchangers and insulated energy storage tanks.

In addition, any components purchased to expand or upgrade an existing solar photovoltaic or solar thermal system qualify for the rebate.

A solar energy system or the components to expand or upgrade an existing solar energy system must be purchased and incorporated into a residential premises or multi-residential building on or after November 26, 2002 and on or before November 25, 2007.

Who can Claim the Rebate?

The rebate may be claimed by the owner of a residential premises or a multi-residential building (owner) who purchases and installs a new solar energy system, or expands or upgrades an existing system.

Source:

Ontario Ministry of Revenue