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November 23, 2016
A note from Utilia Amaral, Chair of CanSIA Board of Directors

We  have many exciting reasons to bring the solar industry together in just over one week for CanSIA's Solar Canada 2016 in Toronto.  With solar energy market development coming from the east coast, Parliament Hill and the prairies - you and your company are sure to benefit from learning new opportunities at the Canadian solar industry's largest and most influential event! 

This year, we are thrilled to host renowned author Jeremy Rifkin, who will share his vision of how technology and consumer options and preferences are driving the economic transformation with implications for solar's future role in our energy supply.  We welcome elected officials and representatives from the federal and provincial governments, who will speak to the importance of creating opportunities to develop our abundant renewable power resources, including solar energy, in support of our national emissions reductions target and economic development goals.  As always, we also welcome industry experts and stakeholders from across Canada to discuss the latest policy, business and technology trends and drivers.  

I encourage you to spend some time reviewing the conference program and to register at your next convenience if you have yet to do so.  Together, let's reflect on how far we've come, what we can accomplish together and with that combination - the exciting year ahead of us.

Please read on for policy and market updates from Team CanSIA:
Policy & Market Development:
Utility & Regulatory Affairs:
Upcoming Events
Solar Canada - Less than two weeks away!
Here are three reasons why you'll want to join thousands of attendees and hundreds of exhibitors from around the globe at Canada's biggest solar show.
  1. Hear from Jeremy Rifkin, the renowned economic and social theorist, about technological change and how it is redefining our electricity sector and economy.
  2. Assess the opportunity of key new policies including the Pan-Canadian Climate Change Framework, Alberta's Climate Leadership Plan and Ontario's Long Term Energy Plan.
  3. Become informed about other trends and drivers redefining the solar industry in Canada including climate policy, community-solar, storage and smart-grid.
CanSIA Corporate and Supporter Members save up to $250 on full conference registration. Join before you register to get the discount.

CanSIA Network Webinar: Solar & Federal Climate Leadership  
Date/Time: November 24, 2016 from 12:30PM - 1:30PM MT / 2:30PM - 3:30PM ET

This webinar will present a status update on the leadership, regulation and investment in support of renewable energy at the federal level in Canada including consultations such as the Canadian Energy Strategy, Pan-Canadian Climate Change Framework, Budget 2017 and Infrastructure Plan. Topics discussed included the opportunities, challenges and outlook for solar.

CanSIA Members can register for the upcoming 'CanSIA Network Webinar: Solar & Federal Climate Leadership' through the Members-Only Portal.

Previous CanSIA Webinar recordings and archived materials can be viewed through the Members-Only Portal on the Network Resources Page.

Policy & Market Development
Federally 100% renewable by 2025, coal phase-out by 2030 and natural gas performance standardscoal
The month of November has played host to several major energy and environment policy announcements from the Federal Government in conjunction with COP 22 in Marrakech and in the run-up to the First Minister's Meeting in early December:
  • The Federal Government has announced that by 2025, 100% of electricity used in their buildings and operations will be from renewable energy sources. This action is in support of a target to reduce the Federal Government's greenhouse gas emissions by 40% as early as 2025. The initiative supports their commitment to a cleaner, more innovative economy that reduces emissions and protects the environment while creating well-paying jobs for the middle class and ensures a prosperous and sustainable economy for the next generation.
  • The Federal Government have submitted: "Canada's Mid-Century Long-Term Low-Greenhouse Gas Development Strategy" to the United Nations Framework Convention on Climate Change, a document detailing what a long-term low-greenhouse gas emission society will entail.   Solar energy is highlighted in this strategy. The chapter titled Decarbonisation and Expansion of Canada's Electricity System presents solar electricity generation increasing significantly to reach levels between 18 TWh (1 per cent of total generation) and 99 TWh (6 per cent) in 2050 representing approximately 10 to 60 GW of cumulative installed capacity in operation.  This implies a Canadian solar market of 100's to 1,000's of MW per year for the next three decades.
  • The Federal Government have released a proposal for new Performance Standards for coal and natural gas-fired electricity generation.  For coal, the existing regulations will require all units to meet a stringent performance standard of 420 tCO2/GWh) by no later than 2030.  This will require that carbon capture and sequestration (CCS) technology be integrated into the facilities in Alberta, Saskatchewan, New Brunswick and Nova Scotia that would otherwise be operational in 2030 or for those facilities to be retired. Some flexibility and opportunities for equivalency agreements are available should they be required in specific instances.  New and modified natural gas-fired combustion engines that sell or distribute more than 33 percent of their potential electricity output to the electrical grid will now also be subject to Performance Standards.  Large combustion engines (>100 MW) would be set at 420 tCO2/GWh, smaller combustion engines (≤100 MW) at 500 tCO2/GWh and boiler units converted from coal to natural gas would have to meet 550 tCO2/GWh for a 15-year period or until 2045, whichever comes first when a standard of 420 tCO2/GWh would then apply. 
The importance of these announcements are that they sends a clear signal that while 2050 is decades away, changes to all decisions with long-term energy implications will need to start today and that solar energy will soon become a mainstream part of Canada's energy future.

Attend Solar Canada 2016 to hear from Ms. Kim Rudd, Parliamentary Secretary to the Federal Minister of Natural Resources whose keynote address will describe how the Government of Canada's ratification of the Paris Agreement and leadership in convening the provinces and territories to develop the Pan-Canadian Climate Change Framework represents the most significant climate action in Canada's history. Ms. Rudd will speak to the importance of creating opportunities to develop our abundant renewable power resources, including solar energy, in support of our national emissions reductions target and economic development goals.

Alberta's Renewable Electricity Program (REP) launched with draft key provisionsRebel
On November 3rd, the details of Alberta's Renewable Electricity Program (REP) were announced.  The first round of the competitive procurement for 400 MW include a Request for Expressions of Interest (RFEI) (Q1/2017), a Request for Qualifications (RFQ) (Q2/2017), and a Request for Proposals (Q4/2017).  AESO indicated that contracts will be awarded in Q4/2017 (approximately November 2017) and that the AESO will pay an 'indexed' Renewable Energy Credit (REC) that establishes a fixed price for renewable energy for a term of 20 years.  
 
CanSIA has initiated the Alberta Renewable Electricity Program (REP) Forum to engage and consult CanSIA Members on the program's process and timelines, draft commercial term sheets ("Renewable Energy Support Agreements") and other issues to equip our response to the Alberta Electric System Operator (AESO)'s stakeholder engagement that will commence on November 10th and conclude on December 9th 2016.  The first Forum meeting has taken place and Members are now invited to contact Patrick Bateman and Ben Weir with comments, queries and feedback (the meeting slide deck and recording can be viewed through the Members-Only Portal on the Network Resources Page). Other useful resources include:  CanSIA's past submissions to AESO;  CanSIA's response to the Alberta Infrastructure RFI;  AESO slide deck with the program's initial details; and, the Renewable Electricity Support Agreement key provisions.

FIT 5 application period opens in Ontariofit5
After some short-term technical issues, the latest round of the Feed-in Tariff Program (FIT 5) has opened to accept applications on November 7, 2016.  The application period runs until November 25, 2016.  The Independent Electricity System Operator (IESO) will procure a minimum of 150 MW for FIT 5, with additional capacity (MW) coming from any unused microFIT capacity and any past attrition from previous small FIT projects.  While it is not yet know the total capacity (MW) that will be added to the base 150 MW, the IESO will announce the final procurement target by December 31, 2016.  While not currently specified, CanSIA expects FIT 5 contracts to be released in early Q2 2017.  Attend Solar Canada 2016 to hear from the Hon. Glenn Thibeault, Ontario Minster of Energy, Bruce Campbell, President & CEO, IESO and representatives of the Ministries of Energy and Environment and Climate Change for the latest updates and background on the program.

Events in Saskatchewan present starting point for solar procurementssask
Last week was a busy one for industry interested in participating in the Saskatchewan renewable electricity market. Beginning on November 16, 2016 with the First Nation Power Authority's (FNPA) second annual energy forum in Saskatoon. This event brought together Indigenous groups, industry, government, and a host of other stakeholders to discuss the FNPAs ongoing work in the energy sector, including on power development opportunities in Saskatchewan, successful First Nation partnerships, and funding options for power projects.

The very next day, SaskPower, in conjunction with CanSIA, CanWEA, the Government of Saskatchewan, and Saskatchewan Industrial and Mining Suppliers Association (SIMSA), hosted a Renewables Independent Power Producers & Supplier Session. The event covered: SaskPower's renewables power plan, regulatory updates from Sask Environment, SaskPower's solar and wind RFP/RFQ process, connection availability and local supplier opportunities and requirements.  The event was also a valuable opportunity for CanSIA's members to make contacts with local service and equipment suppliers that will be important for the successful development of projects in the future. Presentations from the day's event will be hosted on SaskPower's Renewable Roadmap webpage shortly.

100% renewable coalition forms in Ontariocoalition
Ontario is currently in the midst of the consultation period for the next Long Term Energy Plan (LTEP). This new version of the LTEP will set the parameters for the evolution of the energy sector in Ontario over the next 3 years, and there is no shortage of opinions on what those parameters should be. If you are active on social media you will likely have seen calls from Bruce Power for Ontarian's to support nuclear energy. If you have been attending consultations sessions being run by the province you will have heard from natural gas generators, renewable energy companies and advocates, as well as local distribution companies about what type of energy system they believe will work best for Ontarian's. One voice that is beginning to gain more traction, however, is that of the 100% Renewable Energy campaign.

This campaign is making the call for Ontario to switch to 100% renewable energy by 2050 and join a growing list of governments, municipalities (like Vancouver and Oxford County), and companies that are making the same commitment. This commitment would not be a small one. It would involve phasing out the use of both natural gas and nuclear generation and replacing it over time with more solar, wind, hydro, bioenergy, conservation, energy storage and demand response. Making this commitment would help completely decarbonize the Ontario electricity grid and enable its use to electrify other sources of emissions in the province like transportation and space heating. Organizations looking to endorse the commitment can do so here, and individuals can sign the supporting petition here.

Utilities & Regulatory Affairs
Utility Business Models and Behind-the-Meter Solar plus Storage at Solar Canada 2016utility
Investment decision-making in maintaining and expanding our electricity distribution system is more complex than ever before. The rate of technological change make visibility on consumer options and preferences blurry in a five year horizon.  With typical electricity system assets having twenty to thirty year lifetimes, now is a challenging time to commit capital when new assets may become unfit-for-purpose long before their cost has been recovered.  Policy-makers and regulators face a slew of questions.  When will behind-the-meter solar plus storage gain widespread adoption?  How will the electrification of transportation alter the location and shape of energy loads?  How will the Internet of Things change system operability? And most importantly, how should utilities evolve to continue to be relevant and viable in the face of all this change?  A panel session at Solar Canada 2016 moderated by Devin McCarthy, Vice-President, Public Affairs, Canadian Electricity Association will explore these questions and their implications for utilities and the solar industry in jurisdictions across Canada.  Panelists will include:
  • Andres Mand, Manager Regulatory Policy, Ontario Energy Board
  • Neetika Sathe, Vice President, Corporate Development, PowerStream Inc.
  • Vinay Sharma, CEO, London Hydro
  • Brad Wasson, Program Director, Reduce and Shift Demand, NB Power
  • Richard Wunderlich, Head of Power Technologies International, Siemens Canada
Alberta to introduce ceiling for Regulated Rate Option, capacity paymentsceiling
The
Premier Notley and Energy Minister McCuaig-Boyd join an Edmonton family for announcement
electricity market continues to evolve in Alberta in preparation for the province's 30% by 2030 renewable electricity target.  It has been announced that as of June 2017, the province's Regulate Rate Option will be set at a maximum of 6.8 cents per kWh to protect consumers from price volatility as the wholesale electricity market recovers from current lows and as coal is phase-out and more renewables are brought online.  The Globe and Mail has reported that this will be the first of many announcements this week on electricity in Alberta with an expectation for the introduction of capacity payments as a mechanism to ensure that supply adequacy is maintained during the coal phase-out and potential for an update on the coal retirement schedule or fate of the coal Power Purchase Arrangements returned to the Balancing Pool.  CanSIA continue to monitor the situation and will advise Members of key developments.

Coalition For Community Solar Access (CCSA) launches new policy guideCCSA
The Coalition for Community Solar Access (CCSA), a national trade association for community solar in the United States, have released a first-of-its-kind community solar policy decision matrix.  The new tool provides specific recommendations to policymakers about the most effective ways to develop community solar programs in communities nationwide.

"Community solar is a nascent industry, but we're growing fast," explained CCSA Executive Director Jeff Cramer. "With this tool, CCSA is providing actionable recommendations to policymakers seeking to develop successful community solar programs in their states and localities. The "why" of community solar is simple: It is the way to make solar an option for the 80 percent of Americans who aren't able to put solar on their own roofs. But the "how" - updating some of the outdated rules of our electric system to properly account for these new local power sources can be complex. This decision matrix is intended to help guide policymakers in designing programs that work for their communities."

CCSA's policy decision matrix is divided into five sections: program structure, compensation, consumer participation, project characteristics and low-moderate-income considerations. It guides policymakers through important "key questions" to ask when developing community solar programs. To answer these questions, the matrix provides a menu of options, focusing on those that will spur market development while providing choices to customize programs to meet a state's needs and goals.

Key questions to ask relating to program structure, for example, include: What types of entities should be permitted to own and/or manage projects? Should there be a preset size for community solar programs?  The policy decision matrix builds on efforts of other stakeholders working in this space, including the Interstate Renewable Energy Council (IREC) and the Smart Electric Power Alliance (SEPA), and brings the perspectives of CCSA's more than two dozen member companies front and center.  The Policy Guide can be viewed on the resources page of the CCSA website.

Quebec and Ontario sign electricity trade agreementQuebec
On October 21, 2016 the government of Ontario announced an electricity trade agreement between Ontario's Independent Electricity System Operator (IESO) and Hydro Quebec. In effect for 7 years, the agreement allows for the purchase of up to 2 terawatt hours of electricity from Quebec annually, the use of Quebec's hydro facilities to store Ontario electricity during periods of surplus generation, and the reservation of 500 MW of Ontario's capacity to meet Quebec's winter peak demand. This agreement is expected to offset approximately 1 megatonne of GHGs in Ontario by using the electricity from Quebec to offset natural gas generation during periods of peak demand.

Ontario Energy Board holds electricity rates steady for winter 2016winter
For roughly the last 8 years Ontario has seen increasing electricity rates to pay for refurbishing/replacing ageing electricity infrastructure, nuclear and natural gas facilities, and, to a certain extent, for the move to renewable generation from coal. This year, however, the Ontario Energy Board (OEB) announced that residential and small commercial electricity rates would remain steady for the winter 2016 period. Solar companies that are active in the net metering market should use this updated information to ensure financial analyses of net metering systems take account of the maintained rates.

Time of use rates remain at:
  • On-Peak: 18¢/kWh
  • Mid-Peak: 13.2¢/kWh
  • Off-Peak: 8.7¢/kWh
Tiered rates remain at:
  • Up to 600 kWh/month: 10.3¢/kWh
  • Everything over 600 kWh/month: 12.1¢/kWh
Ranking the cost of electricity across Ontario's local distribution companiesranking
On October 25, 2016 the Financial Post released an article showing Ontario's LDCs and how much 1,000 kWh/month would cost the average residential customer. This information should be useful for solar companies active in the net metering market as they seek to find customers who can benefit most from offsetting a portion of their electricity bill with solar.

The cost of electricity for residential electricity customers in Ontario is a function of a number of different bill components. The cost of the energy itself is standard for all residential customers. This cost is set by the Ontario Energy Board in order to collect the necessary revenues to pay generators in the province. The rest of the bill, however, is less standard and can differ between local distribution companies. For example, the distribution portion of the bill pays for the build-out, maintenance and operation of the local distribution companies system (wires, poles, transformers, staff etc.). The total cost of the distribution portion of the bill is driven in large part by the size of the system and the number of customers served (the more customers, the more the cost is spread out).

microFIT, local distribution companies and ensuring a smooth end of yearsmooth
Since the reopening of the microFIT Program this summer, application processing timelines have been delayed. These delays have created a backlog of applications that the IESO is now working through. As of November 18, 2016 the IESO has begun making progress on the backlog and moved almost 200 applications through to Pending LDC Offer to Connect status. This progress is good news for the residential solar industry in Ontario.

It will be important for CanSIA members to keep in close contact with local distribution companies (LDCs) as these applications move through the process. The current microFIT rules specify that if LDCs do not report offers to connect and connected systems within the necessary timelines, that applications will be terminated by the IESO.

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