Friday, November 5, 2010

Community Power Developments in Canada

Background  

In a previous post, I discussed the importance of embedding acceptance for the objectives of Ontario's Green Energy and Green Economy Act (Ontario) (the "Act") within communities. Only by developing widespread support for renewable energy would the province be able to ensure enough support is entrenched to weather future storms and transfers of political power.  Recent developments suggest the province is on track to incorporating local communities in this transformative change.

Ontario's Track Record

Developing community-owned renewable generation is an objective of the Act and a major goal of the Feed-in Tariff ("FIT") Program. Early reviews of the effort by the Ontario Power Authority ("OPA"), which administers the FIT Program, suggest it is realizing some considerable headway in this regard. It has signed contracts for 264 MW of community renewable generation and an additional 120 MW from Aboriginal renewable generation according to an October 12, 2010 report.

Energy analyst Paul Gipe has stated that once these projects are completed, "Ontario will have the largest installed base of community-owned renewable generation in North America, surpassing community ownership of renewable generation in Minnesota." This could put the province on track to have the largest installation of community-owned renewable generation outside of traditional powerhouses Denmark and Germany. However, there is still a palpable sense of uneasiness among the sector's most enthusiastic supporters who see limited financing options and low returns as two significant barriers for these groups to overcome.



In the interim, it is still worth acknowledging that no other jurisdiction in North America has made as concerted an effort as Ontario to guarantee that new renewable generation will be partially owned by its own citizens and Aboriginal peoples. Gipe points out that the current allotment of contracts comprise 16% of Ontario's overall 2,500 MW of FIT contracts, which compares quite favorably to the 10% ownership level in Minnesota. Combined with the 20,000+ applications for 193 MW of power under the OPA's microFIT Program, local investment by communities, homeowners and farmers is developing into a significant component of the province's new generation capacity.

The Legalese:  Defining Ontario's Communities
 
In order to understand how a project qualifies as a "community project", an interested party can simply review the FIT Program rules which explain that a community means: 
  1. one or more individuals resident in Ontario;
  2. a registered charity with its head office in Ontario;
  3. a not-for-profit Organization with its head office in Ontario; or
  4. a "co-operative corporation", as defined in the Co-operative Corporations Act (Ontario), all of whose members are resident in Ontario.
An Aboriginal community is defined to include:
  1. a First Nation that is a "Band" as defined in the Indian Act (Canada);
  2. the Métis Nation of Ontario or any of its active Chartered Community Councils;
  3. a Person, other than a natural person, that is determined by the Government of Ontario for the purposes of FIT Program to represent the collective interests of a community that is composed of Métis or other aboriginal individuals; or
  4. a corporation that is wholly-owned by one or more Aboriginal Communities as described in (1), (2) or (3).
The incentives that have helped to promote the development of both community power and Aboriginal projects include:
  • reduced security payments;
  • a price adder of up to 1.0¢/kWh for community and up to 1.5¢/kWh for Aboriginal projects;
  • start up funding grants; and
  • encouraging municipalities to partner with these project proponents.  

Nova Scotia's Baby Steps

While Ontario's progress may not yet match the 12,000 MW of wind generation in Germany owned by local investors or the local ownership levels of Denmark and the Netherlands, it has been significant enough to catch the eye of another Canadian province. Nova Scotia released a Renewable Electricity Plan on April 23, 2010 with an eye to incorporating 100 MW of community power through the participation of municipalities, Aboriginals, co-operatives, non-profit groups, community economic development corporations and universities in the province's ComFIT or Community Feed-in Tariff program.

The Nova Scotia Utility and Review Board has scheduled a hearing for April 4, 2011, when it will determine the FIT rates for ComFIT. Anyone wanting formal standing at the April hearing must file a notice of intention with the Board by Nov. 8, 2010.

Celebrating the Pioneers

The Ontario Sustainable Energy Association, is hosting its second annual Community Power conference from November 14-17, 2010 in Toronto. Besides a critical review of the first year of the Act and FIT Program and identification of remaining challenges, there will also be an emphasis on acknowledging the successes that have occurred so far and recognition of some of the people that made it happen. The Community Power Awards are being presented to individuals and/or organizations, whose work has contributed significantly to the community power movement. Gord Miller, the Environmental Commissioner of Ontario will open the evening with a keynote presentation.

Awards will be given out in the following categories:
  • Community Power Leader;
  • International Community Power;
  • Aboriginal Community Power;
  • Rural Community Power; and
  • Urban Community Power. 
A complete list of the nominees can be found at www.cpconference.ca.

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