review of Ontario’s Climate Change Mitigation and Low-Carbon Economy Act, 2016

Overview

Released February 25th, 2016, Ontario’s proposed legislative vehicle for its cap and trade regime is largely a list of strong signals of regulatory action. While leaving most things to be detailed in regulation, one of the more important things that the Act establishes (for the most part) is a strong penalty regime. Comprised of 4:1 premiums for under-submitting, fines upwards of $10 million per day, imprisonment for up to 5 years, and administrative penalties of up to $1 million, the consequences to regulatees who don’t comply can be significant.

GHG Coverage, Emission Targets, Reviews, and Progress Reports

Other than the awkward use of “types of greenhouse gas” language, the first few sections of the Act are fairly basic. All seven typical greenhouse gases are covered by the regulations – carbon dioxide, methane, nitrous oxide, HFCs, PFCs, SF6, and NF3. The province-wide GHG reduction targets are codified at section 6 followed by a requirement to develop a living climate change plan that is reviewed every 5 years. In addition to the climate plan review, under section 8 the Minister must publish a progress report on the status of actions in the climate plan.

Duties for Regulatees                                        

The next sections of the Act set out duties and obligations for regulatees. First, is a duty to quantify in accordance with the Province’s Guideline for Greenhouse Gas Emissions Reporting. There are two types of emissions to be quantified: (1) emissions during prescribed activities; and, (2) emissions associated with activities. Both will have their own activities-specific quantification methodologies. Accompanying this duty to quantify is a duty to retain records. Second, is a duty to report followed by a duty to verify. Reporting and verification requirements are the same as the reporting regulation.

Requirement to Submit Allowances and/or Credits

The next group of provisions starts with a duty to submit allowances/credits in an amount equal to the attributed GHG emissions. Past spelling out this duty, the provision goes on to signal that there will be a compliance period, a deadline for submission of allowances/credits, and a mechanism whereby a participant can be exempted from submitting all or part of the quantity of allowances/credits required – but details of these elements will be spelled out in the regulation.

Another important paragraph in this provision sets out the consequences for a failure to submit the required amount of allowances/credits. Those consequences include: (1) Minister may remove allowances/credits from the participant’s accounts equal to the shortfall; (2) participant must repay the shortfall plus a premium of 3 more allowances/credits for each tonne not submitted (i.e. a total of 4:1 repayment for any shortfall); (3) Minister may remove allowance/credits from the participant’s accounts to fulfill the premium; and, (4) participant’s authority to ‘deal’ with allowances/credits in its accounts will be restricted. Following these consequences, if a participant does not submit correctly or does not repay shortfalls or premiums, the Minister may: (1) by order, require the participant to pay an amount (in accordance with the regulation)  to satisfy the outstanding obligations; (2) decline to distribute any free allowances; and, (3) by order, impose any other consequence allowed by the regulation.

Registration as Mandatory, Voluntary, and Market Participants

Mandatory participants will be those intended to be covered by the regulation (i.e. industrial facilities >25kt of emissions, electricity importation, natural gas distribution, and petroleum product supply). Voluntary participants will be limited to entities in the same sectors but those facilities with >10kt but <25kt. Market participants are those that meet conditions set out in the regulation (i.e. not an employee of a mandatory or voluntary participant).

Accounts and Transactions

The first provision in this group restricts buying, selling, trading of allowances and credits to only those entities that are registered participants. Upon registration, the Director shall establish on or more accounts for the purposes of dealing with the allowances and credits (buy, sell, trade, submit to the Minister). Each corporate participant must designate an account representative. This group of provisions ends with a section on fair market practices. The section prohibits fraud, market manipulation (i.e. misleading appearance of trading activity or artificial market price), and false or misleading statements.

Emission Allowances and Credits

The first sections send signals about the creation and distribution of allowances – essentially explaining that details are left to the regulations. You’ll find the actual regulation making powers in section 75.

Provisions around the creation of allowances include signals that there may be limit on the amount of allowances created (i.e. set emissions caps) and that the Minister may retire and/or redistribute allowances removed from a participant’s account. Interesting to note that there is no explicit requirement in the Act to limit the number of allowances created or what that limit should be, only that the regulation may set a limit for a period.

Provisions for the distribution of allowances start with a curious reference to distributing allowances for ‘valuable consideration’ – a fancy way to say they are auction/selling allowances. The distribution of free allowances is also signaled here, prefaced by the idea that free allowances are need to support transition to a low-carbon economy – i.e. free allowances will be used to mitigate price impacts for businesses and consumers.

Other signals related to allowances include that there may be a limit on the allowances for sale or distributed for free, that free allowances to a participant may be restricted, requirements for purchasers at auction, purchase limits, and general auction rules. Concluding the provisions on allowances is the standard requirement not to disclose information related to a person’s participation, strategy, bids in an auction(Ontario will be using a sealed bid auction similar to Quebec and California).

The next provisions deal with credits including offset registries and registration, creation of offset and early reduction credits, applications for credits, and issuing and cancelling credits. All of which are fairly standard.

Inspections and Investigations

Powers for inspections and investigations are comprehensive and mirror many of the powers used in the Environmental Protection Act (EPA). Notably, here the power to inspect requires a warrant or court order – different from the power as it exists in the EPA.

Offences and Penalties

Most offences are subject to the following maximum penalties:

            First Offence Subsequent Offence
Individual $50k/day $100k/day and/or 1 year prison
Corporations $250k/day $500k/day

Specified offences are subject to stricter penalties. These offences include:

  • failing to submit allowances/credits;
  • fraud or market manipulation;
  • disclosure of information related to auctions; and,
  • obstruction of an officer.

All specified offences (for individuals) are subject to a maximum of 5 years (less a day) imprisonment. In addition, specified offences are subject to the following minimum penalties:

  First Offence Second Offence Subsequent Offence
Individual $5k/day $10k/day $20k/day
Corporations $25k/day $50k/day $100k/day

Specified offences are also subject to the following maximum penalties:

  First Offence Second Offence Subsequent Offence
Individual $4 million/day $6 million/day $6 million/day
Corporations $6 million/day $10 million/day $10 million/day

Notably, offences under Ontario’s other environmental statutes (mirrored from the EPA) as well as under the Province’s Commodities Futures Act and Securities Act will be considered a previous conviction for the purpose of penalties.

In addition to the penalties on conviction of an offence, the Act provides for administrative penalties. These are absolute liability penalties that can be levied where the Director is of the opinion that a person has contravened or failed to comply with a requirement of the Act or the regulations. They can be imposed independent of a conviction for the offence. The Act sets a one year limitation period for administrative penalties. It also provides for relief from by giving the Director the power to enter into agreements that can cancel or reduce the penalty. The limit for any administrative penalty under the Act is $1 million. The details of how these penalties are applied and how much they will be set at is left to regulation.

Administration

The last sections of the Act provide from general housekeeping and administrative authorities. The first is that the Environmental Review Tribunal will hear appeals of certain order and/or decisions under the Act. These include decisions related to registration, closing cap and trade accounts, levying of administrative penalties, and compliance orders.

The next key provisions relate to agreements with other jurisdictions and administration/enforcement agreements. The Minister has the authority to enter into either type of agreement – notably, the Minister alone appears to have the authority to harmonize/integrate with other cap and trade systems.

The last of these provisions are the regulation making authorities. These include all the key powers signaled throughout the Act, including: creating and distributing allowances and credits; registration; quantification; and, the purchase, sale, and trade of allowances and credits. Regulations may also exempt ‘a person or class of persons’ from specific requirements of the Act or regulations.

Overall the Act sets out broad statutory boundaries and leaves much of the details to regulation. The Act does establish details of a robust enforcement and penalty regime, signalling to regulatees that compliance is crucial.

Check back here for more in-depth review and analysis of Ontario’s proposed cap and trade program.

www.envlaw.ca

 

 

Ontario proposes cap and trade details

Ontario released it’s proposed cap and trade legislation today – they also released accompanying regulations that will serve to operationalize the cap and trade regime.

For now, here are the quick hits of some key provisions of the regulation:

Section 2 – The first compliance period is 4 years (2017-2020), all others will be 3 years.

Section 3 – Covered activities include chemicals, cement and lime, base metals (copper, nickel, lead, zinc), glass, hydrogen, iron and steel, refining, pulp and paper, electricity import, natural gas distribution, and fuel distribution. Fuel distribution will be the same as in the Reporting Regulation – petroleum refineries, natural gas processing, importing fuel.

Section 4 – In lieu of emissions, regulatees can submit an allowance or what is being called an ‘Ontario credit’. Allowances are created for each tonne under the cap. Credits are created for reductions achieved by offset projects or early action (i.e. reductions made prior to the Act receiving Royal Assent).

Section 14 – Most existing entities need to register by November 2016. Electricity generation facilities are for the most part not covered.

Section 15 – Only certain voluntary participants can opt-in to the system – limited to covered activities.

Section 16 – The system will allow ‘market participants’ which seems to be everyone other than an employee of a mandatory or voluntary participant.

Section 21 – Holding limits will start at about 5.4Mt and will decrease with the cap.

Section 34 – Emission caps (out to 2020) will be 142Mt in 2017, 136Mt in 2018, 131Mt in 2019, and 125Mt in 2020.

Section 35 – The market stability reserve will be 5% of total allowances created in a year and reserved allowances shall be sold to regualtees quarterly. Unsold allowances from a quarterly sale are rolled over to the next sale.

Section 36 – Allowances will be auctioned and any unsold will be rolled over to the next auction. Auctions will be blind (i.e. sealed bid).

Section 50 – Minimum price at auction will start at between $14-$15/t and will rise with inflation.

Free Allowances – From the Appendix to the regulation, most industry will receive free allowances based on facility-specific historic emissions and declining over time. Industry with high fixed process emissions (e.g. aluminum, cement, lime, steel, chemicals) will use a benchmark based approach – similar to Quebec.

Check back regularly for more detailed review and analyais of Ontario’s proposed cap and trade legislation and regulation.

www.envlaw.ca

 

Ontario prepares to release cap and trade details

It has been almost a year since Ontario began talking again about cap and trade. In the fall of 2015 the province released a design options paper complete with high-level policy proposals – see here for an overview. We are now awaiting the release of design details, expected before the forthcoming Ontario budget.

What we think we know…

  • broad coverage including emissions from industry, electricity generation, institutions, buildings, and transportation
  • aligned with Quebec and California – prices effectively dictated by California market
  • free allowances  for all  industry (not electricity) – based on a yet to be determined benchmark and reducing over time (via a cap adjustment factor) in line with the overall emissions cap
  • offsets – limited use but broad list of project types
  • allowances are mostly auctioned – likely use the CITSS trading platform used by California and Quebec
  • strategic reserve will hold allowances back from general distribution (i.e. not sent to auction or given for free) in order to help keep costs down
  • regulatees must register
  • allowance purchase and holding limits

What we’re watching for…

  • level of the cap – it will be interesting to see what is built into the 2017 emissions cap/forecast
  • stringency of benchmarks – the use of historic facility-specific emissions and production will likely be less strict than benchmarks using a sector average or better.
  • similar or different methodologies across sectors for distributing allowances
  • precise coverage of fuel distributors
  • provision of free allowances to electricity distributors – along with any consignment/monetization requirements (i.e. must sell and use $ to the benefit of consumers)
  • Different cap adjustment factors for sectors with high fixed process emissions (FPE) – definition of FPE and use of different rates of decline for sectors like cement, steel, lime, aluminum
  • early reduction credits – limits on use and criteria for creation
  • use of unsold strategic reserve allowances
  • use or signals towards the use of border adjustments for other sectors (e.g. cement, steel) – this is an interesting area given the recent trade issues in the steel sector
  • expanded eligibility for opt-in
  • measures to address conflict between the use of Quebec and California allowances and the achievement of Ontario’s emission reduction targets
  • length of first compliance period
  • treatment of energy-from-waste facilities (i.e. landfill gas electricity generation)
  • extension or shortening of the new facility grace period (e.g. change from current 3 year period)

It may look like we’re waiting on a lot details here but in reality, we (think we) know the majority of the system from the fall design options released by the government. The close alignment with California sheds light on most of the key system elements.

The finer points identified here will help us judge how strict the system will be. It will also give us a better appreciation for the distributional impacts of the system – which sectors win and which sectors lose.

Check back soon for a breakdown of those new details and how the system will ultimately impact businesses and individuals in Ontario.

www.envlaw.ca

 

cap and trade talk again in ontario

Ontario’s planned cap and trade system will put a price on carbon in Ontario. The system will be part of the larger Western Climate Initiative and will be linked with Quebec’s cap and trade system.  The Quebec system is linked with California’s system, so look to Ontario to work towards alignment with them as well. Details are expected in Fall 2015 but some broad strokes can be gleaned from Quebec’s experience.

What price can we expect?

A February 2015 auction in Quebec/California yielded a price of around $15CDN/tonne. Futures (out to 2018 vintage) are trading at roughly the same price. Offsets are pricing at between $13-$14CDN/tonne. If Ontario joins California and Quebec the price impact will depend on the liquidity brought to the market by the Ontario allowances, offsets and other credits. If the system is too lax, the price will creep lower. If there aren’t enough allowances and credits created in Ontario to meet the province’s demand, the price will creep higher.

Who will be covered?

Expect only major industry to be covered – at least in the initial years. Quebec expanded their system after the first 3 years from just major industry to include fossil fuel distributors. Fossil fuel distributors could include gasoline, diesel, and/or natural gas distributors.

How will it work?

The government will set a mandatory limit or cap (in tonnes of CO2 equivalent) on the total amount of greehouse gases (GHGs) that can be released by covered industry. An allowance (emissions credit) will be created for each tonne under the cap. Those allowances will be distributed to various entities based on policies set by the government. Covered entities must remit an allowance for each tonne of GHGs emitted throughout the compliance period (e.g. the previous year). In addition to allowances created under the cap, covered entities will also likely be able to use offset credits for compliance. Offset credits will be created from reductions achieved by activities not covered by the cap and trade system.

How will allowances be distributed?

In Quebec, most allowances are either distributed free to certain industry or sold at government-led auctions. Some allowances may be directed to a reserve fund that could be used to ensure liquidity, protect competitiveness, or accomodate new facilities or major expansions. In Quebec, a reserve is auctioned four times a year and is limited to only covered entities. Ontario would likely follow the same approach.

Who will get free allowances?

Typically, free allowances, usually in the form of output-based rebates, are used to protect against competitiveness impacts in industries determined to be ‘trade exposed’. Ultimately, the Ontario government will decide who, if anyone, gets free allowances and how many. In Quebec, mining and manufacturing sectors, including aluminum, steel, cement, chemicals, pulp and paper, and petroleum refining, receive free allowances along with some thermal power producers. Measures such as these are essential for protecting industries against competitiveness impacts from other jurisdictions either inside Canada or internationally that don’t put a price on carbon.

What other credits will be available?

Aside from allowances created under the cap, Ontario’s system will likely issue offset credits for reductions in unregulated sectors/activities and could explore the use of early action credits to recognize reductions that occur prior to the cap and trade regulations coming into force. A substantive but credible offset system will help ensure liquidity in the credit market and will help keep costs in check.

How will allowances and credits be bought and sold?

The cap and trade system in Quebec and California uses the Compliance Instrument Tracking System Service (CITSS) which is an emissions trading registry and tracking system. The CITSS track allowances and credits (compliance units) from government issuance to distrubtion, transfer, and ultimate retirement. All complaince units are housed in the CITSS. The standard form contract for the transfer of compliance units is the California Emissions Trading Master Agreement. This provides the basic building blocks for an effective compliance unit purchase agreement.

Questions? Worried about compliance? Interested in registering offset projects? Call Graystone Environmental and talk one on one with a climate change lawyer who can navigate clients through any aspect of climate change law in Canada.

the impact of the SCC decision in Hryniak

The Supreme Court of Canada released it’s decision in Hryniak v Mauldin last year and it’s impact is being felt across litigation circles and particular in complicated actions like environmental litigation.

The ability to launch a motion for summary judgment, while in most situations will increase access to justice and ensure proportionality in legal processes, can now have a chilling effect on the litigation of complex issues. Recent decisions have seen courts toss aside actions for failure to show sufficient evidence at hearing of a motion for summary judgment.

In the litigation of complicated issues requiring evidence of cause and damage related to pollution or contamination, there is almost always a reliance on expert evidence. The formulation of this evidence is usually furthered by full and fair disclosure between the parties. The ability to launch a motion for summary judgment before disclosure can handicap plaintiffs, particular where key facts necessary to show causation and damage lie in the hands of the defendant.

The Hryniak decision and the subsequent interpretation of that decision by courts have, in instances where there is a reliance on experts and particularly where key information in the hands of the defendant has not been disclosed, can actually serve to limit access to justice for those impacted by pollution or other environmental issues.

Combining this with the Inco case on damages and the bar to even get to trial has become significantly higher. Plaintiffs must be prepared to and able to present a significant portion of their case prior to any trial. In instances where judges use their fact finding powers under Rule 20, this ‘summary trial’ can put significant onus on the plaintiff to establish his/her case. It also puts significant reliance on the judge to search for and find the necessary facts and evidence that would otherwise be found through a more fulsome discovery process.

Environmental litigants need to be aware of this higher bar and many may rethink their action where the issues are overly complicated and/or where evidence lies in the hands of the defendants.  Environmental counsel will now need to be even more adept at distilling environmental issues into precise facts and combing through complicated or incomplete expert evidence to pick out the necessary elements needed to support an action through an early motion for summary judgment.

riparian rights

In the middle of such a cold winter it’s hard to think about water. But in a few months, snow and ice will be melting and rivers and streams will be overflowing. Every spring brings a new wave of people affected by the changing waterways, particularly following winters with heavy snowfalls. Heading into the fall, most of Ontario was wet. It was a wet summer in most places which kept normally dry creeks and streams, flowing strong in August and September. This meant more mosquitoes (As late as Thanksgiving on Lake Superior we had to use bug spray) and, more importantly, means that the ground was likely fairly well charged with water when everything went into deep freeze. With the ground filled with water and the significant snowfall we’ve had in most of the province this year, we can probably expect a lot of flooding this spring,  bringing with it damage and, no doubt, disputes.

So let’s do a refresher on riparian rights and how they can help us understand how we can protect our land in the face of flooding and protect our water in the face of measures taken to mitigate that flooding.

There are four relevant rights that will attach to any property that abuts a waterway.

Right to Quantity – Riparian landowners have rights to customary flows of water entering and exiting their property.

Right to Quality – Water should enter and leave a property in its natural state.

Right to Proper Drainage – Water should be properly drained onto and off of a property.

Right to Accretion/Erosion – As the waterways naturally change levels, the land exposed by natural drops in water levels become should become property of the landowner. Similarly, as shoreline is eroded this land is lost to the bed of the waterway and becomes property of the Crown. Note that for most waterways in Ontario, issues with these rights are mostly avoided based on the use of the ‘high water mark’ to determine property (vs. the use of the waters edge).

The applicability of each of these rights will depend on the jurisdiction you live in. While Ontario law recognizes, at least in part, these rights, other jurisdictions have overridden some or all of these rights with specific legislation. All these rights can be relevant when trying to protect your land or your water from flooding and/or contamination.

Disputes around flooding are based in a numbers of different causes of action. Everything from beaver dams restricting flow, to improper/negligent release of blocked water/ice dams can cause an infringement of riparian rights. It is important to know your rights as a landowner on a waterway. Not only flooding/restiction of flow but also water contamination can infringement those rights. Those with the proper understanding and advice on their rights will be able to best ensure their water-front property remains a natural and pristine piece of paradise.

ontario climate policy discussion paper

Ontario has released a broad discussion paper on the potential provincial regulation of industrial GHG emissions. Past the need for reductions that “support the province’s economic goals”, the paper highlights the desire for ‘equivalency’ with federal government. Equivalency in a mechanism under section 10 of the federal Canadian Environmental Protection Act, 1999, that allows the federal Governor in Council (read Cabinet) to pass an order suspending the application of federal law in a province or territory. This mechanism has not been used under the current act and has only been used once under earlier versions of the statue. But given the recent federal action on equivalency and its multiple references in the Ontario discussion paper, we should be looking for equivalency to be one of the key drivers that will influence Ontario’s climate policy. The implication being that the bar set by federal government could be as strict as the province will be willing to go.

The discussion paper begins with a short update of U.S. climate initiatives as well as other provincial and domestic (federal) action. It goes on to identify ‘principles’ that will be used as a basis for Ontario’s efforts – some notable ones being: achieving absolute reductions; equity across sectors and facilities; recognizing early action, consideration of alignment with other systems; and incenting investment in technologies that will reduce emissions. Next in the paper is a review of the potential elements and compliance options for a GHG reduction program, summarized below:

Timing: In an indication of how important federal equivalency will be, the province plans to ensure that any provincial regulations will in place a full year prior to any federal action. This is explicitly to allow the province to ” negotiate and finalize an equivalency agreement with the federal government”.

Scope: The program will aim to regulate emissions of the Kyoto six GHGs in at least the same industrial sectors regulated by the federal government with the paper identifying thermal electricity, refining, chemicals, fertilizers, steel, cement, and pulp and paper. Addressing a broader set of sectors is identified as an option and would follow the coverage of Ontario’s current GHG mandatory reporting regulation. The paper specifically excludes transportation and residential heating from its current thinking.

Targets: The emission limit for most sectors will be set at expected emissions at implementation, declining 5% per year for 5 years. The paper signals that a variety of limits could be used to “motivate reductions” including production-based benchmarks (read emission intensity limits), energy benchmarks, and reduction from a historic baseline. The paper again specifically mentions equivalency with federal performance standards (emission intensity limits) as influencing the choice of emissions limit.

Compliance Options: The paper mentions the use of in-house reductions, emissions trading, and offsets. No surprises there.

Some commentary…

The paper seems to be setting up an opportunity for the province to move away from its previously discussed cap and trade system. The emphasis on federal equivalency and the repeating concern about technology investment (which may open the door to an Alberta-like technology fund) all point to a system far different than cap and trade and one that more closely resembles the federal government’s sector-by-sector emission intensity limit approach.

Next steps…

The government is asking for comment on the paper until April 21, 2013. Given the ‘one year before federal’ timelines the paper proposes, it will be a tall order to get regulations out the door by 2015 (or so). As the government responds to public comments and further refines its program proposal, Graystone Environmental will be watching closely to provide you and our clients the most detailed and informed advice to react appropriately to whichever measures the government takes.

microFIT 2.0 directive – launch expected soon UPDATED

UPDATE (December 6th): The MicroFIT application window will open on December 14th.

Finally, the OPA’s microFIT program is expected to start again processing applications. After a considerable hiatus, the program has been re-booted and is ready again to start issuing new conditional offers for microFIT contracts.

Ontario’s Minister of Energy released a directive to the OPA on November 23, 2012 to continue the microFIT program. The directive also touches on other issues related to ground mounted systems and constrained applicants. The entire directive can be read here.

The new program rules, discussed in an earlier post, will contain the new pricing schedule with rooftop solar priced at 55 cents per kWh.

While the new pricing is less than the initial 80.2 cents, it still represents a significant incentive. In addition, those acting quickly can take advantage of the decreased capital costs – the microFIT’s delay has caused a stockpile of equipment across the province.

Prospective proponents should always seek out a professional before engaging in a microFIT project. Call Graystone Environmental to get professional advice and ensure the success of your microFIT project. Contact Roxie Graystone at (613) 862-0551 or roxie.graystone@envconsult.ca.

Find out more about Graystone Environmental.

summary of new microFIT 2.0 rules

The new MicroFIT 2.0 rules were announced this week to the delight (and relief) of many in Ontario’s solar industry. Read all the new program documents here.

Here is a review of the new process:

1. Register

2. Submit an application

3. Application is reviewed and either ‘Terminated’ for incompleteness or, if complete, OPA will confirm caoacity under the remaining Annual Procurement Target. If there is capacity, the applicant’s status is sent to ‘Pending LDC Offer to Connect’. All applications not obtaining capacity by years end, will be terminated.

4. Applicant has 30 days to request a connection from the applicable LDC and 90 days after that must receive an offer to connect. The LDC communicates this to the OPA. After the 90 day limit is passed without an offer to connect, the application is terminated

5.  OPA will approve the application upon LDC confirmation that an offer to connect has been issued (and provided the application meets all MicroFIT requirements).

6. The applicant will have 180 days to install the project and obtain ESA approval, failing which the application will be terminated.

7. Applicant provides particulars of the project to the OPA and OPA offers a final contract if all requirements have been met.

Other than process, there are of course new prices for the various generation technologies. The prices were detailed in my March 29th post and can be found here.

For any questions or concerns with your MicroFIT project, contact Roxie Graystone at Graystone Environmental.

UPDATED – buying and selling constrained microFIT offers

On Friday, the OPA put a quick halt to the frantic rush to sell or move constrained microFIT offers before the new relocation options expire on May 31st. The OPA scratched the requirement for owners to submit option-specific forms complete with relocation/assignment details in favour of a single form. The new form is essentially just a way to reserve the option to take advantage of one of the 4 relocation options. All that is needed is the reference number, the applicant’s name, and evidence of a connection request that was made on or before August 19, 2011 and that was subsequently denied.  

 

The form will also give the OPA a better sense of how many owners will be take advantage of the ‘built project’ option. As I understand this fourth options (and details are not clear right now), the OPA will be facilitating the purchase of relocation of built solar PV systems that are not connected to the grid and that are in a capacity constrained area. How this will be done is unclear, however it may entail amassing a list of purchasers which may take time if there are a significant number of owners who need this type of relief. 

 

After owners have submitted their form, there will be no movement on the OPA’s part until the final microFIT 2.0 rules and contract are released. Given that the comment period on the draft rules ended on April 27th, I would not be surprised to the see the final rules announced in June. Once the new rules are released, constrained offer holders that submitted the necessary paperwork before the May 31st deadline will have (likely) 30 days to submit another application for the specific option they are choosing. 

 

While this change may have slowed the buy/sell market for constrained offers, once buyers are confident that any new option eligibility requirements are able to be met (or that there will not be any changes to the eligibility requirements) the frenzy will likely again pick up. With buyers willing to pay pwards of  $10k to $12K for an single offer, there will likely be no shortage of opportunities for constrained owners looking to sell or move their conditional offers. 

 

For trusted, professional advice on buying, selling, or relocating your constrained microFIT offer, contact me at roxie.graystone@envconsult.ca.