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. Why is it necessary to reduce the rate because people have worked hard to bring the costs down?
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.
| Next > |
|---|
