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Ontario Set to Scale Back Green Energy Feed-in Rates

by Sonya Bell — February 27, 2012 — IPolitics

When the first full-scale review of Ontario’s controversial green energy program is released this spring, observers expect the government will take some cues from TD economist Don Drummond’s recent report on the state of the province’s finances.

“I think Mr. Drummond dropped some pretty big hints in his report in terms of where this was likely to go,” said Mark Winfield, the chair of the Sustainable Energy Initiative at York University. The report did not say the program should be shut down, but it does need to be refined.

Dalton McGuinty enacted Ontario’s Feed-in-Tariff program in 2009 to encourage the development of renewable energy in the province. It offers long-term contracts for partners who generate energy from certain sources including biomass, biogas, landfill gas, wind, solar and waterpower. The program’s scheduled two-year review began in October 2011, and the results are expected as early as March.

In the course of the review process, more than 2,900 Ontarians responded to online survey questions and sent in over 150 written submissions, according to the Ministry of Energy. The province also met with more than 80 stakeholders.

“As a result of this review, new prices for FIT contracts will be carefully developed to balance the interests of ratepayers with the need to encourage investments in new clean energy in Ontario. Going forward, all future clean energy contracts will be subject to the new price schedule,” Energy Minister Chris Bentley said in a statement.

That’s a good start for Drummond. He recommended taking several steps to mitigate the program’s impact on electricity prices. His three suggestions are to lower the initial prices offered in the FIT contract, introduce degression rates to reduce the tariff over time, and make better use of “off ramps” in existing contracts.

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One Comment on “Ontario Set to Scale Back Green Energy Feed-in Rates”

  1. Clyde February 28, 2012 at 6:28 am #

    Claw back the FIT rates for ALL existing contracts. After all “it’s what Europe is doing”. Better yet , eliminate them all together.Make this crap stand on it’s own so-called merits.

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