On July 10, 2009, the Ontario Power Authority (OPA) released updated rules (Program Rules) for the Feed-In Tariff Program (FIT Program). The purpose of the FIT Program is to promote the development of renewable energy sources within the province of Ontario through the creation of a standardized application and approval process for renewable electric generation. The FIT Program is an important element of the Green Energy and Green Economy Act (GEA). The following briefly highlights the basic FIT structure and significant revisions to the Program Rules.
The basic eligibility requirements for the FIT Program are that the facility must: (i) be a new or incremental generating facility; (ii) be located in Ontario; and (iii) generate electricity from one or more of: wind, solar (photovoltaic), landfill gas, waterpower, biogas, or renewable biomass. A new requirement is that applicants must also provide evidence of the necessary title and access rights to construct the project (the "Access Rights," as defined in the Program Rules), which is more detailed than the previous requirement of "Demonstrated Location Access." The Program Rules also move the requirement that applicants give evidence of resource assessment/planning and Renewable Energy Approval from the application stage to the FIT Contract stage.
Although the requirement is not a condition for application to the FIT Program, it is important to note that certain projects will be required to achieve a certain level of "Provincial Content," pursuant to the FIT Contract. The definition of "Provincial Content" is still under review; however, other sections of the Program Rules make reference to an "irreversible manufacturing process" that occurs in Ontario.
The Program Rules also set out specific rules for Community Participation Projects and Aboriginal Participation Projects. Community and Aboriginal Participation will be assessed based on the aboriginal or community proponent's economic interest in the project. A project that receives either of these designations receives, among other benefits, reduced security requirements and an increased price/MW.
One of the most significant changes to the Program Rules is the inclusion of rules that specifically apply to early applications - i.e., Program Launch (a time period to be defined by the OPA). These rules include "rated criteria," whereby applicants receive points for non-mandatory attributes. The new rated criteria indicate the OPA's focus on ensuring that the initial projects awarded FIT Contracts will be able to begin construction immediately and achieve commercial operation on an expedited basis, to assist the Government of Ontario in achieving the goals of the GEA.