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Community investment in renewables and supporting policy
Renewable Energy WorkshopEcho BayNovember 20th, 2008
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Neighbourhood Bulk Buy
• Benefits to homeowners– Volume discount– Delegate research & negotiation– Transparent process– Rapid process
• Installers– Save on sales costs– Save on travel costs
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Neighbourhood Bulk Buying
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Neighbourhood Bulk Buying
• www.ourpower.ca• Resources
– Start-up guides– Sign-up forms– Press release templates– Request for Proposal templates– Applicable incentives and rebates
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Wind Power
• Large or small• Unproven or untested designs
– Vertical versus horizontal axis– Downwind versus upwind– Roof-mounted– ducted
• Underperformance to spec.– No international standards– Unpublished results
• www.wind-works.org
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Val-Éo example
• Landowner co-op– Land lease agreements– Opportunity for neighbours to
invest
• Limited liability partnership– Major financial investors– Major land contributors– Co-op is managing partner
• Project developed democratically
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Val-Éo example
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Val-Éo example
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Val-Éo example
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What is Community Power?
• Locally owned (wholly or substantially) Renewable Energy generation projects
• Optimizes local benefits (social, economic and environmental)
• Commercial-scale (enough energy to sell back to the grid)
• Accessible, open participation• Democratically controlled (1
vote/person)• Financially viable (positive Rate of
Return)
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Economic Benefits of Community Power
Community Power is a proven economic model – Stabilizes long term energy
prices– Creates jobs – Contributes to a culture of
energy conservation
(U.S. Research Project - Iowa Policy Project)
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Local Community Benefits
• Locally Owned Community Power Projects:– Generate 5-10 times the local benefits
than the traditional, centralized energy generation model (Iowa Policy Project )
• Traditional, centralized energy generation model – 75-90 cents of every dollar spent on
energy leaves the local economy (U.S. Dept. of Energy, Rocky Mountain Institute)
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An Emerging Economic Development Opportunity
Operation of wind turbines employs more people than the traditional energy model:
– 27% more jobs than coal plants– 66% more jobs than natural gas
plants
(New York State Energy Research and Development Authority)
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Jobs: Denmark
• World market leader for wind turbine manufacturing – Produce > ½ of the world’s wind turbines– Export rate of 90%
• Generate $7 billion annually – Defined by World Bank as a “high income
economy”– Ninth in ‘Quality of Life’ Index
• (U.S. = 13th, Canada = 14th)• Employ 20,000 people in Renewable
Energy sector– with a population of < NYC
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Jobs: Germany
• Generates $240 billion in annual revenue
• Germany’s Renewable Energy sector employs 250,000 people
• Germany is expected to provide more green jobs than the U.S. auto industry employs by 2020
(United Nations Energy Partnership and Germany’s Federal Minister of the Environment)
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Communities Drive Renewable Energy
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Community-Owned Wind Turbines in Europe
Farmer Community Corporate
Germany 10% 40% 50%
Denmark 64% 24% 12%
Netherlands 60% 5% 35%
Spain 0% 0% 100%
Great Britain 1% 1% 98%
Minnesota 31% 69%
Ontario <1% >99%
Source: NL,D,DK,ES,GB: Dave Toke, University of Birmingham, 2005, updated to Toke 2008Source: Minnesota: Windustry, 2008Source: Ontario: OSEA, 2008
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Economic Dev. Potential for ON
Wind energy projects create new jobs in manufacturing, transportation and construction
Industry Canada states that by 2012
• 13,000 green jobs
• $10 Billion in revenues
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Economic Development Potential for Ontario
Current state of the industry in Ontario:
• Turbine tower (Exhibition Place) was made in Ajax
• New solar/silicon manufacturing plant in Vaughan
• Most of the employees are former auto workers
• Land Leasing ($2-5K/yr/turbine)
• Community Power - Local Renewable Energy project ownership:
• First Nations
• Co-operatives
• Local land owners
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Economic Development Potential for Ontario
Ontario’s Potential Renewable Energy• 30,000 MW Offshore Wind• 25,000 MW Onshore Wind• 5,000 MW Medium/Micro Hydro• 5,000 MW Small Hydro, Solar,
BiogasTOTAL Potential: 65,000 Megawatts
• With a comparable wind resource to Ontario, Germany already has 31,000 MW of installed capacity
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Summary
• Renewable Energy creates a strong case for economic development – Canada’s potential by 2012
•13,000 jobs•$10 billion in revenue
– Ontario’s potential•65,000 megawatts
• Economic benefits can be kept locally through Community Power projects….
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About OSEA
What is OSEA?
A province-wide member-based non-profit trade association founded in 1999
How many members does OSEA have?
1500+ (75 organizations plus individuals)
Who does OSEA represent?
The Sustainable Energy Sector and Community Power including individual citizens, First Nations, co-operatives, farmers, businesses, municipalities and other institutions
What is OSEA?
A province-wide member-based non-profit trade association founded in 1999
How many members does OSEA have?
1500+ (75 organizations plus individuals)
Who does OSEA represent?
The Sustainable Energy Sector and Community Power including individual citizens, First Nations, co-operatives, farmers, businesses, municipalities and other institutions
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Communities Drive Renewable Energy
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Community-Owned Wind Turbines in Europe
Farmer Community Corporate
Netherlands 60% 5% 35%
Germany 10% 40% 50%
Denmark 64% 24% 12%
Spain 0% 0% 100%
Great Britain 1% 1% 98%
Minnesota 31% 69%
Ontario <1% >99%Source: NL,D,DK,ES,GB: Dave Toke, University of Birmingham, 2005, updated to Toke 2008Source: Minnesota: Windustry, 2008Source: Ontario: OSEA, 2008
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Community Power Fund (CPF)
• Founded by the Ontario Sustainable Energy Association (OSEA)
• CPF is a sister organization to OSEA
• Both OSEA and CPF serve the Community Power sector in Ontario
• Defining Community Power – First Nations, farm-based organizations, local
community organizations etc., who want to develop, own, control renewable energy projects for the benefit of their community
– Organizational models include: non-profits, co-operative, corporations that adhere to co-operative principles etc.
– Retain minimum 50% equity ownership
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CPF Current Allocations
Project Development Grants ($3 million)
• Pre-feasibility Grant ($5,000 + Pre-feasibility study template)
• Feasibility Grant ($25,000)
• Strategic Opportunity Grant ($25,000)• Project Development Grant
($50,000 - $300,000)
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First Round of Applications
• 2 Large Wind Grants– Windy Hills Caledon– Chippewas of Georgina Island First Nation and Windfall
Ecology Centre • 5 Strategic Opportunity Grants (Wind)
– Walpole Island First Nation– M’Chigeeng First Nation– Wikwemikong First Nation– Positive Power Hamilton Co-op– Blue Water Agriwind Co-op
• 8 Feasiblity Grants– Campbellford Seymour Community Foundation– Barrie Wind Catchers– LIFE– Next Generation Co-op– Norfolk Federation of Agriculture/FEO– TREC North– Windshare– Windward Co-operative Homes
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The RESOP and Advanced Renewable Tariffs
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The First in North America
• Feed Laws
• Feed-In Tariffs
• Advance Renewable Tariffs (ARTs)
• Renewable Energy Standard Offer Program (RESOP)
• www.onlinepact.org
AustriaBrazilChinaCyprusDenmarkEstoniaFranceGermanyGreeceIndiaIrelandIsraelOntarioPEISouth KoreaSpainSwitzerlandTurkeyWashingtonEtc.
Feed-In Tariffs – Accelerating the Deployment of Renewable Energyby Miguel Mendonça
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OSEA’s Campaign for ARTs
• 2004 - OSEA launches ARTs campaign
• Fall 2004 Liberal Party endorses ARTs
• Winter 2004 – Ministry of Energy contracts OSEA for ARTs Policy study
• Fall 2005 – Ministry of Energy issues Directive to OPA to develop recommendations for a program
• March 2006 - Premier announces the RESOP
• November 2006 – OPA issues RESOP rules
• 2004 - OSEA launches ARTs campaign
• Fall 2004 Liberal Party endorses ARTs
• Winter 2004 – Ministry of Energy contracts OSEA for ARTs Policy study
• Fall 2005 – Ministry of Energy issues Directive to OPA to develop recommendations for a program
• March 2006 - Premier announces the RESOP
• November 2006 – OPA issues RESOP rules
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OSEA’s Campaign Evolves
• November 2007 – issues Renewables Without Limits discussion paper
• May 13 2008 – OPA proposes RESOP changes
• June 2 2008 – OSEA and partners launch Green Energy Act (GEA) Campaign
• September 18 2008 – Premier announces Green Energy Act & Minister of Energy and Infrastructure directs OPA regarding conservation, renewables and First Nations consultation
• November 2008 OSEA releases RESOP recommendations
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10 MW Project CapOpen to all Players 20 Year ContractsStandardized Prices
– 11 ¢/kWh Base Price (wind, hydro, bio-gas)
– 42 ¢/kWh Solar PV– Biogas and Small Hydro + 3.5 ¢
for Dispatchability
Characteristics of the RESOP
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“Value to Ratepayers” vs Cost + ROI
• Criterion subject to internal interpretation
• Not part of OPA’s Mandate
• Not part of OSEA’s proposal
• Neither Spain, France or Germany use “value to ratepayers” in determining tariffs
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• Improved pricing based on cost and differentiated by scale, resource intensity and application
• Grant renewable energy priority access to the grid
• Grant renewable energy priority of purchase
• Grant Community Power proponents priority access to the grid where capacity is limited
• Grant priority access to expanded grid capacity with assured cost recovery for grid companies
• Provide full inflation protection
• Lift the program size cap
• Implement an anti-gaming provision for projects connected to the distribution system
RESOP Evolution
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RESOP Pricing and Technology
Resource Proposed Advanced Renewable Tariffs
Solar PV - Raise base tariff to $0.80/kWh- Differentiate by size and placement- Grandfather in existing contracts
On-Farm Biogas
- Raise base tariff to $0.17/kWh- Differentiate by size- Grandfather existing contracts
On-Shore Wind
- Raise tariff to $0.148/kWh - Differentiate rate by resource intensity
Off-Shore Wind
- Base tariff of $0.186/kWh - Differentiate rate by resource intensity
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RESOP Pricing and Technology Continued
Resource Proposed Advance Renewable Tariffs
Solar Thermal
-Base tariff of $0.10/kWh-Differentiate by application
Geothermal -Base tariff of $0.22/kWh-Differentiate by size
Hydro - Raise tariff to $0.14/kWh- Differentiate based on efficiency not name plate capacity- Peak increment $0.35
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Why Advanced Renewable Tariffs?
• Community power proponents aren’t precluded
• Broad-based participation
• Simplified administrative process
• More players, stronger local economies, more manufacturing, more jobs, more renewable energy generation
• A proven policy mechanism
• Provides stable investment and manufacturing environment
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What’s Next?
The Green Energy Act!
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Best Practice
• Germany’s Erneuerbare-Energien-Gesetz (EEG), or Renewable Energy Sources Act 2000
• Enshrined Feed-in Tariffs in law
• World-leading industry in 15 years
• 32,000 MW of installed renewable energy
• Latest figure ~ 215,000 people employed in German renewable energy industry
• For more information on the EEG:
www.bmu.de
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Building on Best Pracitices
Building on EEG in addition to OSEA’s evolved RESOP the Green Energy Act will also emphasize:
• Conservation• Role of Energy Utilities• Accessibility• Modernization - smart grid technologies• Expanded Community and First Nations’
Participation
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• Make Ontario a world leader: jobs, energy policy, renewables and conservation
• Prioritize conservation, RE and CHP over all other new electricity generation
• Enable all Ontarians to become conservers and generators while making a profit
• Grant priority procurement and obligatory grid access via Advanced Renewable Tariffs for RE and CHP projects
• Ensure a continuous improvement approach to conservation programs - minimum 2.5% annual (compounding) reduction in energy resource needs from CDM between 2011 – 2027 period
Core Goals
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• Environmental Defense
• David Suzuki Foundation
• Ontario Federation of Agriculture
• First Nations Energy Alliance
• The Ivey Foundation
• Pembina Institute
• Ontario Sustainable Energy Association
• Community Power Fund
Green Energy Act Coalition
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Draft Issues• Community Power
• Renewable Energy Procurement
• Grid Evolution
• Conservation
• Environmental Protection
• Planning, Permitting, and Environmental Assessments
• Jobs and Training
• Administration and Governance of the Energy Sector
• Other Act Amendments
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Stakeholders
• First Nations• Farmers• Unions• ENGOs• Industry Associations• Muncipalities• Utilities• Lenders and other financiers• Etc.