On March 22, the Ontario Power Authority (OPA) and Ministry of Energy completed a mandated biennial review of the province’s Feed-in Tariff (FIT) program—and announced plans to pull back slightly on subsidies, while pushing ahead to meet renewable energy targets.

Following a thorough assessment—which included feedback from nearly 3,000 community members and organizations— the government has renewed and reinforced its commitment to clean energy, moving up the date for achievement of the province’s 10,700-megawatt (MW)  renewable energy target from 2018 to 2015. 

Two renewable energy sectors will be see a reduction in funding. The prices being offered for wind and solar projects under new 20-year power purchase agreements from the OPA will be between 10 percent and 30 percent lower than under power purchase agreements issued prior to the review.  The 30 percent-level reduction will be limited to solar PV ground-mounted systems generating less than 10 kilowatts (kW) and to solar PV rooftop arrays generating less than 10kW. There will be no change to prices offered for hydro, biomass, biogas, or landfill gas projects. Tariffs will be adjusted every year in November and will take effect two months later, on January 1.

In addition, the new program will:

• Create more jobs sooner, by streamlining the regulatory approvals process for projects, while maintaining the highest environmental protection standards;
• Encourage greater community and Aboriginal participation through a new priority point system, which will also prioritize projects with municipal support;
• Reserve 10 percent of remaining capacity for projects with significant participation from the local or Aboriginal population; and.
• Develop a Clean Energy (News - Alert) Economic Development Strategy to leverage Ontario's significant expertise and strengths to become a global leader in the sector.

Launched by the OPA in October 2009, pursuant to a directive issued by the Minister of Energy under the Green Energy and Green Economy Act, Ontario's FIT plan has provided a guarantee to sellers of electricity produced from the sun, wind, water, biomass and other renewable sources that their power will be purchased for 20 years at fixed-rate, above-market prices.

The province’s clean energy strategy has attracted more than $27 billion in new investment and economic opportunities. More than 20,000 clean energy jobs have been created to date and Ontario is on track to create 50,000 jobs.

In the private sector, the solar industry, which took the hardest hit, refused to ratchet up the debate. Jason Gray, vice president and country manager, SunEdison (News - Alert) Canada, commented, “SunEdison is pleased to be a part of Ontario's clean energy economy. The release today of the revised FIT program shows the government remains committed to this important initiative. We look forward to continuing to create clean jobs here in Ontario.”

“This is an aggressive pricing change, but it is fair and the industry will move forward. I believe the industry and the investment community is simply looking for certainty around the program, which is exactly what the today's announcement provides. AMP looks forward to continuing to create clean jobs and develop great projects here at home and around the world,” opined Dave Rogers, CEO of AMP Solar Group.

Other renewable energy representatives stood behind the program. “The Ontario Waterpower Association welcomed the opportunity to provide input and advice through this review process. Our industry looks forward to continuing to invest in expanding the contribution of Ontario's original renewable–waterpower,” said Paul Norris, president of the Ontario Waterpower Association.

The province said it will study whether it needs to increase its renewable capacity target at the end of 2013, based on power supply and demand forecasts.

In a press release, the Ministry of Energy noted, “Building a clean energy system is part of the [Dalton McGuinty administration's] plan to create and support jobs for Ontario families while ensuring we have the electricity we need to power our homes, schools, hospitals and our economy.”