MicroFIT program sows seeds of interest among homeowners
Scott Bennett says that when it came to time to exploring alternative energy options for his home, "I looked at everything under the sun."
Obvious puns aside, Bennett, an environmental sustainability professional who also runs his own green consultancy, Carbon Diet, launched a solar installation on his home in Brooklin, Ont., last November.
As an early participant in the Ontario Power Authority’s (OPA) microFIT (feed-in tariff) program, Bennett is a proponent of the microgeneration movement for residential use. He also appreciates the fledgling efforts on the part of some provinces and utilities to encourage alternative energy investment for homeowners.
"It’s these programs that make [microgeneration] financially viable," he says.
Microgeneration is the small-scale production of heat and/or electricity from a low-carbon source, which can include solar, wind, geothermal, biomass or others. It’s used by larger commercial operations, rural residents, or individual homeowners as a means to offset costs, or reduce reliance on conventional energy sources — or both.
In terms of electricity production, microgeneration has been commonly used for "off the grid" applications for years, such as vacation property owners faced with prohibitive utility hook-up costs; or alternative energy enthusiasts who prefer to go their own way.
Give and take
Microgeneration on the grid is a slightly different story. In that scenario, business owners or residents hook up their renewable electricity generation source to the local utility, and sell their power at a higher rate than what they get billed.
"It’s simple. You get paid for the power you put on the grid, and you pay for what you take from the grid," Bennett explains. "We generate about 5000 kilowatts a month and buy about 6000 kilowatts."
In Ontario, that means applying for a 20-year contract with the OPA’s FIT program for applications over 10 kW; or microFIT program for smaller residential and business projects.
Once the deal is approved and your technology of choice is installed, the resident then applies to their local utility for a connection to the grid. A dual meter is used to measure the electricity generated and consumed.
The utility sends a bill for monthly usage based on the going rate (typically 11 to 12 cents per kWh). In a separate process, it sends out a cheque for the power purchased at a rate of 80.2 cents per kWh.
Upping the appeal
Making renewable energy a more attractive investment for homeowners is the whole idea behind microgeneration programs, says Ben Chin, former vice-president of corporate communications for the OPA in Toronto.
"The intention is to make it easier to get over the financial hurdle and encourage greater interest," he says. "Usually you can pay your project costs within 11 years over a 20-year contract with us, which translates into a 10 per cent return on your equity."
Utility provider ENMAX Corp. in Calgary has recently embarked on a commercial solar and microwind program for the province’s residential market. The ENMAX model differs from the OPA program in that it offers a lease option and maintains the solution for a small up front cost and ongoing monthly fee. The energy from their microgeneration system is credited to the resident’s bill.
A 1.2 kW solar power system will typically deliver up to 20 to 30 per cent of the energy needed, depending on the size of the house, explains Helen Bremner, executive vice president of smart grid technologies for ENMAX. "Wind can take you up to a 2.4 kW system, but you need space and decent wind regime for it to work."
While the seeds of interest may have been sown, microgeneration still represents a very small portion of the energy picture, Chin reports. To date, installed capacity for the program has reached 20 MW, a large portion of which are solar photovoltaic (PV) applications. "Considering we have a 35,000 MW system, that’s a tiny amount."
Interest is growing strong however. To date, the OPA has received almost 27,000 applications since October 2009 accounting for over 245 MW worth of microgeneration projects.
The ENMAX program’s goal of 10,000 installations represents a mere one per cent of the market, Bremner admits. "But it’s a starting point. Then we can look to grow it from there."
Labour of love
Beyond the costs, one of the biggest hurdles for homeowners to overcome is the processes that go with it.
"Applying for a conditional offer from [the OPA] is the easy part," Chin says. "But you can’t just wave a magic wand to make it happen. There is work involved."
That includes choosing a system, hiring a contractor to install it, applying for municipal permits (where applicable), arranging inspections, and contacting your local utility to see if it has the capacity to connect you to the grid.
Getting experts to perform your system installation can be a significant challenge, notes Kevin Whitehead, vice president of engineering/business services for Whitby Hydro Energy Services Corporation.
"Qualifications are a main issue. A lot of people are coming out of the woodwork and selling systems regardless of how they perform. You can’t just stick these things anywhere; so you need to do your screening up front to understand the load on your roof, structural needs, orientation of the panels and permits."
"Finding the contractor is in itself a full challenge," Bennett confirms. "There used to be two solar companies around here; now there are 40, from roofing companies to electricians. It took one farm west of me a year to get his solar system running because the supplier changed ownership twice."
It’s also work for the utilities, Whitehead notes. "There is extra effort in terms of tracking, setting up billing systems, putting a second meter on an account, etc. And there can be some glitches in terms of municipal bylaws, etc. that have needed to be worked out."
Chin notes that despite the work, utilities are on board. "It’s a whole new line of business for them. But they’ve been supportive from the beginning. For each challenge, they also see opportunities to support the system."
Logistics aside, utilities are on board and residents keen to take part, Whitehead confirms. "I know that the first few people we talked to who joined the program were quite excited, because they saw the green benefit."
Bremner believes that microgeneration programs are an important and necessary means to feed the growing interest in sustainable energy provision and alternative energy choices. For her, it’s a simple formula: "If we can make it easy, understandable and affordable, they will engage."