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FAQs & Useful Information

Feed-in tariff (FIT)

About Community Power

Rooftop Solar PV


Why is greenTbiz putting on an educational series about community power?

With the transition in Ontario’s energy supply from large fossil fuel plants to smaller scale distributed generation consisting of renewable energy, an opportunity has opened up for individuals, small businesses and community groups to benefit by generating electricity and profits. To assist small businesses and BIA communities in taking advantage of this opportunity, TABIA’s greenTbiz Program has launched this seminar series to educate BIAs, BIA members and local residents on how and why they should consider the development of rooftop solar PV projects in local BIA communities.

Who can I contact to arrange a seminar?

Please get in touch with greenTbiz Program Manager Robert Wakulat. He can be reached via email at robert@wakulat.ca or by phone at 416-458-4841.

Feed-in tariff (FIT)

What is a feed-in tariff?

A feed-in tariff (FIT) enables anyone who generates renewable electricity to connect their project to the public electricity grid and sell all the electricity they generate to the Province of Ontario under a long-term fixed contract at a guaranteed rate. Their revenue is calculated per kWh fed into the grid, making the system owner a true generator of electricity. Typically a generator has two meters, one for the electricity bought from the grid and one for that sold to the grid.

Ontario adopted feed-in tariffs for roof- and ground-mounted solar PV, wind, small hydro, biomass and biogas with passage of the Green Energy and Green Economy Act, 2009.  Under the Ontario program, the microFIT program covers systems with total AC power output of 10 kW and under. It is aimed at homeowners and small businesses and offers premium rates and a streamlined application process.  The FIT program is geared toward larger, commercial applications over 10 kW.

How do I connect to the electricity grid?

Your renewable energy project can either be “directly connected” to the electricity distribution system or “indirectly connected”. A direct connection is where your project is connected to the grid separately from any other customer or building. An indirect connection is where your project is connected to an existing building that is connected to the distribution system. Your renewable energy project(s) will be connected to the grid through an electricity meter that will be different from the meter that measures your consumption. This meter will allow your local electricity distribution company to measure the electricity you generate and pay you accordingly.

Can I use the energy I produce myself?

Not under a FIT program. The energy you produce and the energy you consume are metered separately. You pay your regular rates for the energy you consume and get paid the specified tariff for the energy you produce. In reality, especially for rooftop solar PV systems, a household or a business that has installed such a system may well end up using the energy they have just fed into the grid.

Other jurisdictions in Canada and the United States have introduced incentive schemes under which generators actually use the energy they produce themselves. Under a ‘net metering’ system, generators of renewable energy do indeed only have one meter that runs either backwards or forwards depending on whether more energy is consumed or produced at a given time. Net-metering is usually combined with a tax incentive scheme.

True ‘off-grid’ systems currently make financial sense in very remote locations only. Everywhere else feed-in tariffs or tax incentives are needed to further a more widespread adoption of renewable energy technologies. Over time, prices for hardware will and have come down significantly already, eventually making off-grid a more viable option for the future.

How much will my energy bill be reduced?

See above. Your local distribution company (LDC) (e.g. Toronto Hydro) will meter and account for the energy you consume and produce separately. Your LDC will charge you a nominal monthly administrative fee to manage your FIT account.

How much electricity does a home need?

The average Canadian household uses about 11,000 kWh of electricity a year. To compare, an ideally placed 10 kW solar PV system will feed about 13,000 kWh of electricity per year into the grid in Ontario. A 10 kW system is comparatively large for a roof-mounted residential system.

Is solar thermal (hot water) covered by the Ontario FIT?

No, solar thermal is not currently part of the FIT program.

When is the right time to apply for a FIT or microFIT contract?

The Ontario Power Authority is currently reviewing the FIT program and will not process any applications until further notice. Completion of the review is expected by May 2012. The OPA is looking at changes in pricing structure as well as regulatory requirements. Nevertheless, it is currently possible to submit a FIT application. This will get you a time stamp and put your project in approval queue once the OPA resumes processing applications. If you want to be sure of the economics of your project and your contractual obligations, it is safer to wait until the review is complete.

Will the tariffs change after the review?

It is a challenge to anticipate the OPA’s conclusions; however, other jurisdictions with FIT programs, such as Germany, have typically reduced their FIT tariff rates over time to reflect cheaper component prices and improved installation expertise.

About Community Power

What is community power?

A community power project revolves around the financial, conceptual and organisational participation of citizens (local community) in a renewable energy project.

A community power project is a renewable energy project owned in full or in part by local residents. Ownership can be organized narrowly (e.g. through a Limited Partnership) or widely (e.g. through a co-operative). Community power democratizes electricity generation, ensures that investment returns will be enjoyed locally and lays the foundation for a more decentralized and robust electricity grid.

What legal entities are considered community power groups?

Under current FIT rules, the following entities are considered community power groups with a 100% community participation level:

  • one or more individuals resident in Ontario;
  • a registered charity with its head office in Ontario;
  • a not-for-profit organization with its head office in Ontario;
  •  a “co-operative corporation”, as defined in the Co-operative Corporations Act (Ontario), all of whose members are resident in Ontario;
  • a private corporation whose shareholders all fall into the first four categories above, and for whom commercial electricity generation is not their primary business or employment;
  •  a partnership or limited partnership whose partners all fall into the first four categories  above, and for whom commercial electricity generation is not their primary business or employment

In addition, joint ventures with entities that do not fall into the above categories are possible. The community ownership share in the project will determine the community tariff adder applicable to the project.

Can a for-profit organisation be a CP group?

Yes, see previous answer.

Can municipalities be part of a CP project?

They can. However, only as part of a joint venture with the legal entities listed above under question 2.

Where can I find examples of community power projects?

Here are a few projects we know of. Some of them are already fully operational in Toronto:

For a list of other community projects operational and under development, go to the CEEP’s website at http://www.communityenergyprogram.ca/Project_Grants/FITGrants_Awarded.aspx 

Whom can I contact to help me plan my project?

Koenig & Consultants, greenTbiz’s partner in delivering this educational series, helps community groups develop their renewable energy projects. For contact details, please go to www.kci-newenergy.ca.

Rooftop Solar PV

Will the additional load from the panels on the roof be a structural problem?

This depends on the quality and age of the roof you are considering for your solar installation. In any case, it is highly recommended that a structural engineer inspect the roof prior to the installation of any panels to make sure it can bear the additional load.

How heavy are solar panels?

On average, one panel weighs about 20 kg.

What warranties are there for hardware?

A FIT or microFIT contract has a 20-year term; your hardware may be functional over a longer period though. Typical hardware warranties are provided for:

  • Panels: 5-10 years on workmanship and 20 years on productivity
  • Racking system: typically 5 years
  • Inverters: varies widely, minimum 5 years but extended warranty can be acquired

What are the operation and maintenance costs?

Average operation and maintenance (O&M) costs depend on the quality of the hardware chosen for the solar system. Generally speaking, solar requires very little O&M. The main components that might need replacement or repair are the inverters. To be conservative, a reserve fund of 5% of the generated revenue should be established.

How can I finance my project?

If you are planning to individually own your solar project, you may consider financing it through a mortgage on your house. Major banks (e.g. RBC, TD) or credit unions (e.g. Italian Canadian Credit Union) have or are developing specific financing tools for microFIT projects.

As a community power group you will be eligible for up to $200,000 in soft cost grant financing through the Community Energy Partnership program (CEPP). Depending on the size of your project you may consider forming a co-operative and issuing shares or bonds to raise the funds required for hardware and construction.

Do we need insurance?

Yes, you will need insurance. If the solar system is installed on the roof of your property, it will need to be added to your property insurance. More and more insurers are adding insurances for rooftop solar to their standard offering, but you might still experience that some insurers are not moving ahead fast enough.