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Gipe - Ontarios FiT: Setting The Standard In North America

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Ontario's FiT: Setting the Standard in North America
Presented by Paul Gipe at the Green Energy Act Finance Forum on Friday January 29, 2010
For more information visit http://www.marsdd.com/greenenergyforum

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Gipe - Ontarios FiT: Setting The Standard In North America

  1. 1. Disclaimer: The views expressed are those of Paul Gipe and are not necessarily those of the sponsor. Disclosure: Paul Gipe has worked with Aerovironment, ANZSES, APROMA, ASES, AusWEA, AWEA, BWEA, BWE, CanWEA, Canadian Co-operative Assoc., CAW, CEERT, DGW, DSF, EECA, ES&T, GEO, GPI Atlantic, IREQ, KWEA, MADE, Microsoft, ManSEA, MSU, NRCan, NRG Systems, NASA, NREL, NZWEA, ORWWG, OSEA, Pembina, PG&E, SeaWest, SEI, TREC, USDOE, WAWWG, WE Energies, the Folkecenter, the Izaak Walton League, the Minnesota Project, the Sierra Club, and Zond Systems, and written for magazines in the USA, Canada, France, Denmark, and Germany. Paul Gipe, wind-works.org
  2. 2. Carleton College V82, Northfield, Minnesota Ontario’s Feed-in Tariffs: Setting the Standard in North America by Paul Gipe Paul Gipe, wind-works.org
  3. 3. Höhe Westerwald, Germany Setting the Stage Paul Gipe, wind-works.org
  4. 4. Renewables Can Be Added Quickly Wind 5 yrs Wind 10 yrs Solar 5 yrs Germany 15 TWh/yr 35 TWh/yr 5 TWh/yr Spain 15 TWh/yr 28 TWh/yr 5 TWh/yr Germany Renewables: 10 Years--5% to 15% Spain: 10 Years--0% to 10% Paul Gipe, wind-works.org
  5. 5. 2008 North American Wind Market Ontario 6th Largest Market Total MW Thousands 7.1 Texas 2.8 Iowa 2.5 California 1.8 Minnesota 1.5 Washington 1.0 Ontario 0.0 2.0 4.0 6.0 8.0 Paul Gipe, wind-works.org
  6. 6. North American Solar PV Market Ontario Moves to Top of List California Ontario (2009) New Jersey Colorado Nevada 0 50 100 150 200 2008 MW/yr Paul Gipe, wind-works.org
  7. 7. “Nothing is as powerful as an idea whose time has come.” -- Victor Hugo *Loose translation of “On résiste à l'invasion des armées; on ne résiste pas à l'invasion des idées. Paul Gipe, wind-works.org
  8. 8. Renewable Tariffs in North America . . Unthinkable? • Yes--Just 6 years ago “You’re Absolutely Nuts!” Andy Karsner, DOE, 2006 • Today? No • Now Possible • Growing Trend in North America & Developing World China, India, Mongolia Paul Gipe, wind-works.org Gaspé, Quebec
  9. 9. Renewable Tariffs . . . Toronto, Ontario Developing Momementum Paul Gipe, wind-works.org
  10. 10. Ontario Moved First First Modern System of Advanced Renewable Tariffs in North America Paul Gipe, wind-works.org Montfort, Wisconsin
  11. 11. Ontario “Gets It” • Closing Coal Plants • Delaying Nuclear Build • Putting Renewables First Groundbreaking in North America Paul Gipe, wind-works.org Goderich, Ontario
  12. 12. Ontario’s Green Energy & Green Economy Act • Multi-faceted • Efficiency & Conservation • Renewable Energy Procure Through Feed-in Tariffs Paul Gipe, wind-works.org
  13. 13. Ontario’s Green Energy Act The Most Progressive Renewable Energy Policy in North America in Two Three Decades Paul Gipe, wind-works.org Goderich, Ontario
  14. 14. Ontario’s Green Energy Act • Changes Public Policy on Electricity Includes Industrial & Environmental Policy • Gives Renewables Priority In Utility Procurement & System Design • Targets Industrial Development • Targets Job Creation Goal: 50,000 Jobs in 3 Years Paul Gipe, wind-works.org
  15. 15. Ontario’s Feed-in Tariffs • Differentiated by Size & Technology • Differentiated by Application • Tariffs Based on Cost of Generation Plus Reasonable Profit • No Program Cap (Bring It On!) Sarnia, Ontario Paul Gipe, wind-works.org
  16. 16. Ontario’s Feed-in Tariffs • First Offshore Wind Tariffs in NA • First Aboriginal Bonus in NA First NA Policy for First Nations • First Differentiated Solar PV Tariffs 5 Tranches or Classes • Best Wind, Solar, & Biogas Tariffs in NA Competitive Internationally Paul Gipe, wind-works.org
  17. 17. Prices Paid for Wind Energy in Europe $CAD/kWh Germany France Spain Ontario 0 0.02 0.04 0.06 0.08 0.1 0.12 0.14 0.16 Paul Gipe, wind-works.org
  18. 18. Prices Paid for Offshore Wind Energy $CAD/kWh Germany France Ontario 0 0.05 0.1 0.15 0.2 0.25 Paul Gipe, wind-works.org Middelgrunden, Denmark Google Maps
  19. 19. Solar PV Tariffs Worldwide Washington State* Italy South Korea Ontario Czech Republic France Germany Austria Spain California* South Australia* 0 0.2 0.4 0.6 0.8 1 1.2 1.4 $CAD/kWh Paul Gipe, wind-works.org
  20. 20. Solar PV Yields Hamburg, D Nuremburg, D Stuttgart, D Reims, F Toronto, ON Halifax, NS Nice, F Madrid, E 0 200 400 600 800 1000 1200 1400 1600 kWh/kW/yr Source: RetScreen Paul Gipe, wind-works.org
  21. 21. Ontario’s Feed-in Tariffs • No Subsidies or Grants • Costs Borne by Consumers Not Taxpayers--More Egalitarian • Community Wind Bonus Third Jurisdiction in North America Paul Gipe, wind-works.org
  22. 22. Grading North American FITs 10 Criteria • Program Caps • Project Size Caps • Contract Term • Technologies Included • Tariffs Based on Cost of Generation • Tariffs Differentiated by Technology • Tariffs Differentiated within Technology • Wind Tariffs Differentiated by Resource • Inflation Indexing • Bonus Payments or Adders Paul Gipe, wind-works.org
  23. 23. Grading North American FITs The Gold Standard Score Grade Germany 90 A France 90 A Spain (Fixed Tariff) 80 A- Paul Gipe, wind-works.org Fuchskaute, Germany
  24. 24. Grading North American FITs Historical FITs Score Grade Cal ISO4 (1983-1984) 43 F Ontario SOC (2006-2008) 55 D Ontario SOC--Good First Start for North America Paul Gipe, wind-works.org
  25. 25. Grading North American FITs Criteria Germany France Ontario Program Caps 10 10 10 Project Size Caps 10 8 8 Contract Term 10 10 10 Technologies Included 10 10 8 Tariffs Based on Cost of Generation 10 10 10 Paul Gipe, wind-works.org
  26. 26. Grading North American FITs Criteria Germany France Ontario Tariffs Differentiated by Technology 10 10 10 Tariffs Differentiated within Technology 20 16 20 Wind Tariffs Differentiated by Resource 10 10 0 Inflation Indexing 0 6 3 Bonus Payments or Adders 0 0 5 Paul Gipe, wind-works.org
  27. 27. Grading North American FITs Existing FITs Score Grade Ontario (2009) 84 A- Vermont 54 D Maine 43 F Wisconsin IOUs 36 F California 28 F Oregon 16 F Paul Gipe, wind-works.org
  28. 28. Ontario Success Due To • Push for Renewable Policy Not a Solar PV or a Wind Policy • Push for Conservation & Efficiency Reduces Program Costs to Ratepayers (Danes Pay Less for Electricity Than Ontarians) • Collaborative Strategy Green Energy Act Alliance: Green NGOs & Labor Trade Groups: CanSIA, CanWEA, OWA • Public Consultation Paul Gipe, wind-works.org
  29. 29. Ontario’s FITs--Issues Remaining • Domestic Content Local Choice • Differentiating Wind Tariffs by Resource Intensity • Samsung Deal Paul Gipe, wind-works.org Wolfe Island, Ontario
  30. 30. Differentiated Tariffs for Wind • Distributed Benefits Only Accrue From Distributed Generation Differentiated Tariffs = Distributed Wind • Reduces Pressure on Windiest Sites Profitability Still Higher at Windy Sites • Reduces NIMBYism By Enabling Greater Participation Paul Gipe, wind-works.org San Gorgonio Pass, California
  31. 31. Differentiated Tariffs for Wind • Increases Program Flexibility Lessens Pressure to Get Prices Right the First Time • Reduces Development Risk Determining Final Price After 5 Years of Operation • Spreads Opportunity to All Not Just to Elite Few • Provides Fair Profits at Modest Wind Sites • Limits "Excessive Profits" at Windy Sites Paul Gipe, wind-works.org
  32. 32. French Wind Tariffs Resource Productivity Method • Fair Profits at Medium Wind Sites • Not “Undue” Profits at Windy Sites • Price Adjusted for Inflation 60% • Profitability Index Method (Chabot) Not Discounted Cash Flow Model Paul Gipe, wind-works.org Igny, Lorraine, France
  33. 33. French Wind Tariffs by Specific Yield $CAD/kWh 0.15 Base Medium High 0.1 0.05 0 960 1000 1040 1080 1120 1160 1200 1240 1280 1320 1360 1400 1440 Specific Yield (kWh/m2/yr) Paul Gipe, wind-works.org Chateau de Lastours, France
  34. 34. French Wind Tariffs 2006 $CAD/kWh 0.15 0.1 27% CF (900 kWh/m2) 0.05 32% CF (1,100 kWh/m2) 41% CF (1,400 kWh/m2) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Year Paul Gipe, wind-works.org
  35. 35. Ontario’s Samsung Deal--Troubling • Non Transparent Hallmark of FITs is Transparency • Preferential Grid Access Hallmark of FITs is Equal Access • Preferential Tariff (EDA) Non Transparent Price Setting No Public Discussion of $0.01/kWh Adder May Pay Too Much at Windy Sites Must Have Differentiated Wind Tariffs to Avoid Overpayment Paul Gipe, wind-works.org
  36. 36. Ontario’s Samsung Deal • Must Not Jeopardize FIT Program Community & Aboriginal Projects Dynamic & Competitive Market • Could Be Model for Other Mfgrs. Could Stimulate Interest by Other Players Paul Gipe, wind-works.org St. Olaf College V82, Northfield, Minnesota
  37. 37. Ferndale, Ontario Ontario’s FIT Program World Class “Made in Canada” Paul Gipe, wind-works.org
  38. 38. Move From A Culture of Consumption to A Culture of Conservation --Ontario Premier Dalton McGuinty Paul Gipe, wind-works.org Montfort, Wisconsin
  39. 39. Move From A Nation of Consumers to A Nation of Producers Paul Gipe, wind-works.org Lackawanna, New York
  40. 40. Matane, Quebec We Need A Lot More Wind . . . Paul Gipe, wind-works.org
  41. 41. Hinesburg, Vermont . . . A Lot More Solar Paul Gipe, wind-works.org
  42. 42. . . . A Lot More Renewable Energy Technology for Life* *from N.F.S. Grundtvig, Danish Theologian Paul Gipe, wind-works.org
  43. 43. Ontario’s Feed-in Tariffs . . . Setting the Standard in North America www.wind-works.org Manawatu Gorge, New Zealand

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