What is the REAL cost of MicroFIT
Major media outlets do a disservice to the public when they don't check their facts before they run with stories. In an editorial yesterday entitled "The Solar Divide", the Toronto Star picked up the government's refrain that the original MicroFIT feed-in tariff rate for ground mounted solar projects was exorbitantly expensive for Ontario taxpayers. The editorial argued that the rate needed to be cut from $0.80 to $0.58 per kilowatt hour before "it ends up costing electricity ratepayers an unnecessary $1 billion in extra costs."
The $1 billion in extra costs which is cited in government press releases and picked up in the Star editorial sounds like a very big number indeed, but closer examination of the numbers released by the government tells a different story.
There are approximately 10,000 MicroFIT projects that applied for contracts at the original $0.80 rate but which have not yet been approved yet. Assume for a moment that these are ALL ground mount solar projects. The Ontario Power Authority published figures which show that the difference per project between the original tariff and the reduced tariff is $2,950 per year in electrical cost (averaged for tracking and non-tracking installations). 10,000 projects x $2,950 per year = $29.5 million dollars per year in extra power cost. By comparison, in its 2009 financial report, HydroOne reported total costs of $3.9 billion per year.
The cost to meet the government's MicroFIT feed-in tariff commitment for the 10,000 existing projects is less than 1% of HydroOne's annual cost. Is that too much to pay to maintain investor confidence in the future of community solar energy in Ontario...especially in comparison with the government's $7 billion backroom deal offered to corporate giant Samsung?