What’s Ontario’s FIT?

By: Joel Palma (York University)

Ontario’s feed-in tariff program was first established by the Green Energy and Green Economy Act in 2006 and was be implemented by the Ontario power authority. The feed-in tariff program (FIT) is North America’s first comprehensive guaranteed pricing structure for renewable electricity production. The types of renewable sources that are included in the FIT programs are: biomass, biogas, landfill gas, onshore wind, solar photovoltaic, and water power. The FIT programs are then divided into two streams. The first is the FIT program which projects over 10 kilowatts and is meant for renewable energy developers. The second is the MicroFIT program which projects 10 kilowatts or less and is designed for homeowners and small businesses. (“Feed-in tariff program,” 2010) By encouraging the development of renewable energy in Ontario, the FIT program aims to;

Help Ontario phase out coal electricity generation by 2014
Boost economic activity and the development of renewable energy technologies
Create new green industries and jobs

(“FIT program”) Ontario’s feed-in tariff program was then revised and modified in 2009 and has increased the economic return from 42 cents/kWh to 80.2 cents/ kWh in MicroFIT programs. As of April 2010, several hundred projects have been approved, including 184 large scale projects worth 8 billion dollars. (“MicroFIT program”) Once a person has entered into the feed-in tariff contract, they will receive a fixed price for the electricity that is produced over the next 20 years. The contract for water powered energy generation, however, is based on a 40 year term. The prices that will be paid for the electricity will vary, but is designed to cover typical capital and operating costs, while providing a reasonable return for the investment over the term of the contract. (“Feed-in tariff program,” 2010) These programs are a great way for large companies, small businesses, and even average homeowners to help power Ontario with clean energy, while reducing the need for energy plants that create carbon dioxide, and even provides an economic return. The economic return is perhaps the most inviting incentive as this will provide a direct benefit to the investor in a time where money seems to be the most important player in the capitalist society that we live in.

When the FIT programs were created in 2006, they agreed to modify FIT programs, FIT rules, FIT contracts, and price schedules at two year intervals. During the program overview, the Ontario power authority will explore the possibility of allowing additional applications of the same renewable fuel on the same property. This will allow the OPA to ensure that proponents are not taking advantage of splitting projects to obtain higher prices, while still encouraging incremental renewable energy capacity in a manner that makes sense. This biannual overview was just completed with the following recommendations:

Create more jobs sooner by streamlining the approvals process while still maintaining the highest environmental protection standards
Reduce prices: Wind by 15%, Solar by 20%
Encouraging greater community and Aboriginal participation through a new priority system
Reserving 10% of remaining capacity for projects with significant participation from local or Aboriginal communities
Develop a Clean Energy Economic Development strategy to leverage Ontario’s expertise to become a leader in the sector

(“Moving clean energy,” 2012) RETScreen will be a very valuable tool for businesses, homeowners, or Aboriginal groups who are looking to invest in these renewable energy programs. RETScreen is a tool that helps decision makers, quickly and inexpensively determine the technical and financial viability of potential renewable energy, energy efficiency, and cogeneration projects. Our research group believes that there is a great way that we can use renewable energy and that is to power the Toronto District School Board, with Markham District High School as our model. We believe that there are many options that could be explored that would help benefit the Toronto District School Board as well as the province. RETScreen was used to determine if there was any point in investing money and resources into building photovoltaic cells on the roof of Markham High School. If there was economic potential for developing grid-tied systems on schools in the Toronto District School Board, we would definitely explore that option. We would then need to talk to the Toronto District School Board and get them to register for a FIT program as it would be more than 10 kilowatts. The FIT programs would provide the schools, as well as Ontario with clean power, reduce the need for carbon emissions in energy production, and would create many job opportunities in the “green” industry. The economic wealth that would be generated from the investment could then go towards the school board’s budget which is rapidly decreasing every year.