Disclaimer: The views expressed are those of Paul Gipeand are not necessarily those of the sponsor.

Disclosure: Paul Gipe has worked with Aerovironment,ANZSES, APROMA, ASES, AusWEA, AWEA, BWEA,BWE, CanWEA, Canadian Co-operative Assoc., CAW,CEERT, DGW, DSF, EECA, ES&T, GEO, GPI Atlantic,IREQ, KWEA, MADE, Microsoft, ManSEA, MSU, NRCan,NRG Systems, NASA, NREL, NZWEA, ORWWG, OSEA,Pembina, PG&E, SeaWest, SEI, TREC, USDOE, WAWWG,WE Energies, the Folkecenter, the Izaak Walton League,the Minnesota Project, the Sierra Club, and ZondSystems, and written for magazines in the USA, Canada,France, Denmark, and Germany.

Paul Gipe, wind-works.org

Carleton College V82, Northfield, Minnesota

Ontario’s Feed-in Tariffs:Setting the Standard in North America

byPaul Gipe

Paul Gipe, wind-works.org

Höhe Westerwald, Germany

Setting the Stage

Paul Gipe, wind-works.org

Renewables Can Be Added Quickly

Paul Gipe, wind-works.org

Germany Renewables: 10 Years--5% to 15%Spain: 10 Years--0% to 10%

Wind 5 yrs Wind 10 yrs Solar 5 yrs

Germany 15 TWh/yr 35 TWh/yr 5 TWh/yr

Spain 15 TWh/yr 28 TWh/yr 5 TWh/yr

2008 North American Wind MarketOntario 6th Largest Market

7.1

2.8

2.5

1.8

1.5

1.0

Texas

Iowa

California

Minnesota

Washington

Ontario

Total MW Thousands

0.0 2.0 4.0 6.0 8.0

Paul Gipe, wind-works.org

North American Solar PV MarketOntario Moves to Top of List

California

Ontario (2009)

New Jersey

Colorado

Nevada

0 50 100 150 200

2008 MW/yr

Paul Gipe, wind-works.org

Paul Gipe, wind-works.org

*Loose translation of “On résiste à l'invasion desarmées; on ne résiste pas à l'invasion des idées.

“Nothing is as powerful as an ideawhose time has come.”-- Victor Hugo

Renewable Tariffs in North America . . Unthinkable?

• Yes--Just 6 years ago“You’re Absolutely Nuts!”

Andy Karsner, DOE, 2006

• Today? No

• Now Possible

• Growing Trendin North America

& Developing World

China, India, Mongolia

Paul Gipe, wind-works.org Gaspé, Quebec

Toronto, Ontario

Renewable Tariffs . . .Developing Momementum

Paul Gipe, wind-works.org

Ontario Moved First

First Modern Systemof Advanced Renewable Tariffs

in North America

Paul Gipe, wind-works.org Montfort, Wisconsin

Goderich, Ontario

Ontario “Gets It”

Paul Gipe, wind-works.org

• Closing Coal Plants

• Delaying Nuclear Build

• Putting Renewables FirstGroundbreaking in North America

Ontario’s Green Energy& Green Economy Act

• Multi-faceted

• Efficiency & Conservation

• Renewable EnergyProcure Through Feed-in Tariffs

Paul Gipe, wind-works.org

Goderich, Ontario

Ontario’s Green Energy Act

The Most Progressive RenewableEnergy Policy in North America

in Two Three Decades

Paul Gipe, wind-works.org

Ontario’s Green Energy Act

• Changes Public Policy on ElectricityIncludes Industrial & Environmental Policy

• Gives Renewables PriorityIn Utility Procurement & System Design

• Targets Industrial Development

• Targets Job CreationGoal: 50,000 Jobs in 3 Years

Paul Gipe, wind-works.org

Ontario’s Feed-in Tariffs

• Differentiated by Size & Technology

• Differentiated by Application

• Tariffs Based on Cost of GenerationPlus Reasonable Profit

• No Program Cap (Bring It On!)

Paul Gipe, wind-works.org

Sarnia, Ontario

Ontario’s Feed-in Tariffs

• First Offshore Wind Tariffs in NA

• First Aboriginal Bonus in NAFirst NA Policy for First Nations

• First Differentiated Solar PV Tariffs5 Tranches or Classes

• Best Wind, Solar, & Biogas Tariffs in NACompetitive Internationally

Paul Gipe, wind-works.org

Prices Paid for Wind Energy in Europe

Paul Gipe, wind-works.org

Germany

France

Spain

Ontario

$CAD/kWh

0 0.02 0.04 0.06 0.08 0.1 0.12 0.14 0.16

Prices Paid for Offshore Wind Energy

Germany

France

Ontario

$CAD/kWh

0 0.05 0.1 0.15 0.2 0.25

Paul Gipe, wind-works.org Middelgrunden, DenmarkGoogle Maps

Solar PV Tariffs Worldwide

Paul Gipe, wind-works.org

Washington State*

Italy

South Korea

Ontario

Czech Republic

France

Germany

Austria

Spain

California*

South Australia*

0 0.2 0.4 0.6 0.8 1 1.2 1.4

$CAD/kWh

Solar PV Yields

Paul Gipe, wind-works.org

Hamburg, D

Nuremburg, D

Stuttgart, D

Reims, F

Toronto, ON

Halifax, NS

Nice, F

Madrid, E

0 200 400 600 800 1000 1200 1400 1600

kWh/kW/yr

Source: RetScreen

Ontario’s Feed-in Tariffs

• No Subsidies or Grants

• Costs Borne by ConsumersNot Taxpayers--More Egalitarian

• Community Wind BonusThird Jurisdiction in North America

Paul Gipe, wind-works.org

Grading North American FITs10 Criteria

• Program Caps

• Project Size Caps

• Contract Term

• Technologies Included

• Tariffs Based on Cost of Generation

• Tariffs Differentiated by Technology

• Tariffs Differentiated within Technology

• Wind Tariffs Differentiated by Resource

• Inflation Indexing

• Bonus Payments or Adders

Paul Gipe, wind-works.org

Grading North American FITsThe Gold Standard

Score Grade

Germany 90 A

France 90 A

Spain (Fixed Tariff) 80 A-

Fuchskaute, GermanyPaul Gipe, wind-works.org

Grading North American FITs Historical FITs

Paul Gipe, wind-works.org

Score Grade

Cal ISO4 (1983-1984) 43 F

Ontario SOC (2006-2008) 55 D

Ontario SOC--Good First Start for North America

Grading North American FITs

Criteria Germany France Ontario

Program Caps 10 10 10

Project Size Caps 10 8 8

Contract Term 10 10 10

Technologies Included 10 10 8

Tariffs Based on Cost of Generation 10 10 10

Paul Gipe, wind-works.org

Grading North American FITs

Paul Gipe, wind-works.org

Criteria Germany France Ontario

Tariffs Differentiated by Technology 10 10 10

Tariffs Differentiated within Technology 20 16 20

Wind Tariffs Differentiated by Resource 10 10 0

Inflation Indexing 0 6 3

Bonus Payments or Adders 0 0 5

Grading North American FITs Existing FITs

Paul Gipe, wind-works.org

Score Grade

Ontario (2009) 84 A-

Vermont 54 D

Maine 43 F

Wisconsin IOUs 36 F

California 28 F

Oregon 16 F

Ontario Success Due To

• Push for Renewable PolicyNot a Solar PV or a Wind Policy

• Push for Conservation & EfficiencyReduces Program Costs to Ratepayers

(Danes Pay Less for Electricity Than Ontarians)

• Collaborative StrategyGreen Energy Act Alliance: Green NGOs & Labor

Trade Groups: CanSIA, CanWEA, OWA

• Public Consultation

Paul Gipe, wind-works.org

Ontario’s FITs--Issues Remaining

• Domestic ContentLocal Choice

• Differentiating Wind Tariffsby Resource Intensity

• Samsung Deal

Paul Gipe, wind-works.org Wolfe Island, Ontario

San Gorgonio Pass, California

Differentiated Tariffs for Wind

• Distributed Benefits

Only Accrue From Distributed Generation

Differentiated Tariffs = Distributed Wind

• Reduces Pressure on Windiest Sites

Profitability Still Higher at Windy Sites

• Reduces NIMBYism

By Enabling Greater Participation

Paul Gipe, wind-works.org

Differentiated Tariffs for Wind

• Increases Program FlexibilityLessens Pressure to Get Prices Right the First Time

• Reduces Development RiskDetermining Final Price After 5 Years of Operation

• Spreads Opportunity to AllNot Just to Elite Few

• Provides Fair Profits at Modest Wind Sites

• Limits "Excessive Profits" at Windy Sites

Paul Gipe, wind-works.org

Igny, Lorraine, France

French Wind Tariffs Resource Productivity Method

• Fair Profits at Medium Wind Sites

• Not “Undue” Profits at Windy Sites

• Price Adjusted for Inflation 60%

• Profitability Index Method (Chabot)Not Discounted Cash Flow Model

Paul Gipe, wind-works.org

French Wind Tariffs by Specific Yield

Paul Gipe, wind-works.org

960 1000 1040 1080 1120 1160 1200 1240 1280 1320 1360 1400 1440

Specific Yield (kWh/m2/yr)

0

0.05

0.1

0.15$CAD/kWh

Base Medium High

Chateau de Lastours, France

French Wind Tariffs 2006

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Year

0

0.05

0.1

0.15$CAD/kWh

27% CF (900 kWh/m2)

32% CF (1,100 kWh/m2)

41% CF (1,400 kWh/m2)

Paul Gipe, wind-works.org

Ontario’s Samsung Deal--Troubling

• Non TransparentHallmark of FITs is Transparency

• Preferential Grid AccessHallmark of FITs is Equal Access

• Preferential Tariff (EDA)Non Transparent Price Setting

No Public Discussion of $0.01/kWh Adder

May Pay Too Much at Windy Sites

Must Have Differentiated Wind Tariffs toAvoid Overpayment

Paul Gipe, wind-works.org

Ontario’s Samsung Deal

• Must Not JeopardizeFIT Program

Community & Aboriginal Projects

Dynamic & Competitive Market

• Could Be Model for Other Mfgrs.Could Stimulate Interest by Other Players

Paul Gipe, wind-works.org St. Olaf College V82, Northfield, Minnesota

Ontario’s FIT ProgramWorld Class

“Made in Canada”

Ferndale, Ontario

Paul Gipe, wind-works.org

Move FromA Culture of Consumption

toA Culture of Conservation

Paul Gipe, wind-works.org

--Ontario Premier Dalton McGuinty

Montfort, Wisconsin

Move From

A Nation of Consumers

to

A Nation of Producers

Paul Gipe, wind-works.org Lackawanna, New York

We Need A Lot More Wind . . .

Paul Gipe, wind-works.org

Matane, Quebec

. . . A Lot More Solar

Paul Gipe, wind-works.org

Hinesburg, Vermont

. . . A Lot More Renewable Energy

Technology for Life*

*from N.F.S. Grundtvig, Danish Theologian

Paul Gipe, wind-works.org

Ontario’s

Feed-in Tariffs

. . . Setting the

Standard in

North America

www.wind-works.org

Manawatu Gorge, New Zealand