Ontario’s Solar Feed In Tariff Lesson

Back in March of 2006, The Premier of Ontario, Canada announced the implementation of a gross feed in tariff program. Under the plan, the Ontario Power Authority would purchase electricity produced by wind, biomass, small hydroelectric and grid connected solar power systems. The price paid for solar power was  set at AUD 51 cents (current exchange rate) per kilowatt hour produced, guaranteed for 20 years.

The goal of Ontario’s feed in tariff program was to add up to 1,000 megawatts of renewable energy to Ontario’s electricity supply over a decade; enough to power 250,000 homes.

According to an article on the New York Times, while a window of 10 years was allowed for to reach the target, uptake of renewable energy systems became so popular, the 1,000 megawatt mark was reached within a year and the program temporarily ended. Ontario is expected to re-launch the feed-in tariff next week under new green energy legislation.

Thanks to initiatives such as the province’s feed in tariff program,  25 per cent of Ontario’s electricity came from renewable sources in 2008. One of North America’s largest solar farms is currently under construction near Sarnia.

Research and real world experience has continually shown that a feed in tariff program can be spectacularly successful in boosting emissions free electricity generation capacity if 3 basic criteria are met; being:

a) A rate well above the current market rate paid per kilowatt hour to stimulate investment in solar energy systems. The payment recompenses home owners over a period of time for renewable energy  infrastructure that power companies would otherwise need to invest in.

b) A gross feed in tariff rather than net. A net feed in tariff only pays on surplus electricity generated by a system; whereas a gross model pays on each kilowatt hour produced.

c) A generous or non-existent cap on system size.

While many governments around the world continue to struggle with meeting renewable energy and emissions targets and are often influenced by an ailing, yet still extraordinarily powerful coal industry; populations stand by ready to do their bit to help achieve clean power goals. One example of a display of support is a petition recently launched by Australian solar energy company Energy Matters that in less than a month has gathered over 10,000 signatures to encourage the Australian government to implement a nationalised gross solar feed tariff program.