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Solar modules gain new groundBy Larry Dreiling
Editor's note: High Plains Journal Senior Field Editor Larry Dreiling recently traveled to Canada as a member of the U.S. delegation to the 55th annual congress of the International Federation of Agricultural Journalists, participating in tours and seminars in southern Ontario. In this feature based on his excursions, Dreiling looks at how a local farmers' cooperative has moved from selling seed and fertilizer to selling solar energy, too. While the central part of the U.S. is staking its energy future on expansion of coal-fired energy generation, the Canadian province of Ontario is taking a different route toward increasing its energy capacity. Prior to 2003, Ontario's electrical grid was weakening and unreliable, according to the Ontario Power Authority. Between 1995 and 2003, the system lost 1,800 megawatts of power, or the equivalent of the hydroelectric capability of Niagara Falls running dry. At that time, Ontario relied heavily on five coal-fired electric plants. The province's medical community said coal generation was having an impact on health by increasing the incidence of various respiratory illnesses. A 2005 study prepared for the government found that the average annual health-related damages due to coal could top $3 billion. It was then the provincial government voted to end coal-fired electrical generation for Canada's most populous province by 2014. Since then, Ontario has seen the single largest climate change initiative in North America, reducing the use of coal by 70 percent. In 2010, greenhouse gas emissions from the electricity sector reached the lowest they have been in 45 years. In 2009, the last time figures were available, more than 80 percent of Ontario's electrical generation came from wind, water, solar, biogas and nuclear sources--all of them considered emissions-free. Between 2005 and 2010, electrical prices to consumers in Ontario have seen an increase of 4.5 percent. This has happened despite the buildup of new infrastructure, particularly the installation of more than 3,000 miles of new, more efficient, high-voltage transmission lines, and lots of incentives for homeowners and businesses to make their places more energy efficient, as well as build small solar and wind generating facilities. The agricultural producers of Ontario are taking advantage of these incentives as well, using a solar cell purchasing scheme developed by a local cooperative. AGRIS Co-operative, a Chatham, Ontario-based co-op with more than 1,200 members, is now the sponsor of AGRIS Solar, a 400-member co-op representing farm and rural properties across Ontario. The Green Energy and Green Economy Act established in Ontario in February 2009 included a proposal for a new renewable energy supply procurement program known as a Feed-In Tariff Program that will further encourage the development of renewable energy supply. Under a feed-in tariff, eligible renewable electricity generators (which can include homeowners and businesses) are paid a premium price for any renewable electricity they produce. Typically, regional or national electric grid utilities are obliged to take the electricity and pay for it. The province offers what are called "MicroFIT" contracts to those entities whose energy generation projects are 10 kilowatts of power or smaller. AGRIS Solar is the province's largest manager of ground-mounted solar MicroFIT contracts. The province of Ontario has invested $4.6 billion in new renewable energy projects since 2003. More than 30 solar manufacturing companies have launched or expanded in Ontario since 2009, when the Green Energy Act was passed. Solar energy systems installed in Ontario in 2010 resulted in over $750 million being injected into Ontario's economy. The tariff pays 44.3 to 80.2 cents per kilowatt-hour for electricity from solar installations. Rooftop installations earn a higher rate than those on the ground; smaller projects get more than larger ones. All the rates are far above the wholesale price for electricity, about four cents per kilowatt-hour, or what residential customers pay: less than 7.5 cents. That power will be sold directly to Ontario Hydro One at 64 cents per kilowatt-hour, a drop of 16 cents from the rate first established by the Ontario government cut back a year ago. The lower price is still enough to provide the owner of each site with an income estimated at $3,700 a year together with a $1,500 annual lease payment. Farmers will pay AGRIS Solar $20,000 for a unit, with an estimated payout in five years. It is believed the incentives will allow all types of generators--such as private developers, businesses and homeowners--to participate. The program is reasonable enough that prices will cover total project costs and provide a reasonable rate of return over a long-term, 20-year, contract. By offering long-term price guarantees, investor confidence and access to financing has been good, according to Jim Campbell, general manager of AGRIS Cooperative Ltd. "We're a 90-year co-op," Campbell said. "We've been in the traditional farmer cooperative business all those years, selling all the things to farmers every co-op sells, but we're pretty pleased with this new venture. We're part of the provincial Green Energy Act, which works to promote clean, renewable energy." What AGRIS Solar brings to farmers who wish to enter into a MicroTIF agreement with Ontario HydroOne for a solar installation is diversification and spreading of risk, using the co-op's connection with the local Farm Credit Bank. Only one panel is allowed per farm. "We bring volume purchasing and commercial debt. We found the technology and equipment suitable for our cooperators," said Andrew Clark, general manager of AGRIS Solar. "What we ask of our cooperators is that they give us a piece of land and $20,000 to install that unit. The co-op takes it from there. "We take the person who has a steep learning curve on something like this and we flatten it out for them, plus we promise to run it for them for 20 years. We currently have 400 members and 700 installations, representing $65 million in capital investment, and we are looking to grow the cooperative." One unique characteristic of the solar panels used at these farms is their control systems that adjust the solar installation to face the brightest point in the sky to maximize power yield. As for the look of a solar panel on a farmer's land, Clark said neighbors have few objections compared with the erection of wind turbines. "People around here do object very strongly to wind generation," Clark said. "We've found that there's fewer objections to solar." This despite, in the case of the landowner the excursion visited, having the panel installed on the lawn near to the homestead, located close to a major road. Despite farmer objections to small wind generation installation, Ontario is at the forefront of wind energy in Canada, with more than 2,600 MW of wind generation capacity expected to be in service by the end of 2011. Four of Canada's largest wind farms are located in Ontario. The Canadian Wind Energy Association has outlined a future strategy for wind energy that would reach a capacity of 55,000 MW by 2025, meeting 20 percent of the country's energy needs. Still, the people at AGRIS Solar are excited about growing their project. "Farmers have been harvesting the sun since the first crop of corn was planted," Campbell said. "For us to convert solar energy into something else was pretty natural." Larry Dreiling can be reached by phone at 785-628-1117, or by email at ldreiling@aol.com.
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