Minister of Energy issues directive to Ontario Power to continue FIT Program

Andrew Sullivan -

On November 23, 2012, the Minister of Energy (MOE) issued a directive to the Ontario Power Authority (OPA) to continue the Feed-in Tariff (FIT) and MicroFIT programs in furtherance of the directions issued on April 5 and July 11, 2012.

This latest directive follows the Land Use Working Group’s submission of recommendations regarding siting of ground-mounted solar projects on rural zoned lands with multiple primary uses and rural/agricultural zoned lands with abutting residential uses.

The following is a summary of the significant policies the MOE has directed the OPA to implement.

The MOE has directed the OPA to open the Small FIT application window as soon as possible and follow through with awarding 200MWs of projects. Additionally, the MOE directed the OPA to continue to develop rules and a contract as soon as possible for applicants with unconstructed buildings wishing to apply to Small FIT.

Ground Mounted Solar Photovoltaic Projects Siting

The directive provides further restrictions on the siting of ground-mounted solar photovoltaic projects (GM Solar Projects) larger than 10kW. These restrictions are to apply to rural zoned lands with multiple primary uses, where the residential is one such primary use (Rural Lands) and rural/agricultural zoned lands with abutting residential uses (Abutting Residential Lands).

For Rural Lands and Abutting Residential Lands, the MOE directed the OPA not to award new FIT contracts or consent to a site amendment of an existing FIT contract unless the Supplier commits to the three conditions. First, for GM Solar Projects between 10kW and 10MW on or proposed to be on Rural Lands, the Supplier must implement a minimum setback of 20 meters from all property lines. For GM Solar Projects larger than 10MW on Rural Lands or for GM Solar Projects larger than 10kW on Abutting Residential Lands, a 100 meter setback from all property lines is required. In each case, the 100 meter setback may be reduced to 20 meters if the municipality in which the GM Solar Project is located (Relevant Municipality) provides a resolution agreeing to such a reduction. Second, the Supplier must visually screen the GM Solar Project from bordering properties zoned to permit residential as a primary use. Third, the Supplier must make arrangements to maintain the visual screen of the GM Solar Project for the term of the FIT contract.

These conditions, among others, will not apply to existing FIT contract Suppliers who, prior to April 5, 2012, notified the OPA, the Relevant Municipality or the MOE in writing of the Supplier’s proposed site amendment and who provide evidence of such written notice to the OPA no later than Sunday, December 23, 2012 (Exempt Suppliers). However, the MOE has directed the OPA to make reasonable efforts to negotiate with Exempt Suppliers to include the setbacks, visual screening and maintenance arrangements for Solar Projects.

Community and Aboriginal Set-Aside

In an effort to prioritize community and Aboriginal participation, the directive allocates 100MW of contract capacity set-aside (“CCSA”) divided as follows:

For Small FIT:

  • 18.75MW for First Nation equity participation projects;
     
  • 7.25M for Small FIT Metis equity participation projects; and
     
  • 25MW for Small FIT community equity participation projects.

For Large FIT:

  • 18.75MW for First Nation equity participation projects;
     
  • 7.25M for Metis equity participation projects; and
     
  • 25MW for community equity participation projects.

In all cases, CCSA projects must have 50% community or Aboriginal equity participation.

In the event that any category of Aboriginal (First Nation or Metis) CCSA target is not reached, then, to the extent there are additional CCSA projects in another category that exceed the target, those projects will be considered in the undersubscribed category.

Once the CCSA targets are met or once all CSSA applications have been processed, then the OPA will no longer prioritize CCSA projects and will process applications for all projects based on prioritization points set out in the Prioritization Points Table in Appendix A of the July 11, 2012 Direction, which may include community or Aboriginal projects. 

The OPA has been directed to review FIT applications to verify that those applications seeking community or Aboriginal participation project priority points meet required economic interest criteria.

Re-launching the Community Energy Partnerships Program (CEPP) and Aboriginal Renewable Energy Fund (AREF)

The MOE has directed the OPA to align program rules and funding parameters of the CEPP and AREF to provide for Pre-FIT funding or Partnership Funding. Pre-FIT funding is meant to provide financial support to community and aboriginal projects submitting a FIT application. Partnership Funding provides aboriginal projects with support to perform due diligence associated with entering partnership agreements. Total funding from the CEPP and AREF is not to exceed $500,000 each. A number of rules limiting funding will apply. The CEPP will be developed and delivered through one or more third party provider.

Connecting Constrained MicroFIT Projects

The MOE has provided the OPA with a number of options to connect otherwise constrained MicroFIT projects. 
 

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