New Brunswick Community Energy Policy Will Fail to Provide Sufficient Incentive for Renewable Energy Investments
On February 9, 2010 New Brunswick Energy Minister Jack Keir announced a new so-called feed-in tariff that will pay 9.728 cents/kWh for power generated from ”embedded generation” power projects up to 3 kW. Many observers agree that this price is far too low to encourage investment in renewable energy projects, and is not a true feed-tariff like those used in Ontario and in Europe.
“Feed-in tariffs are supposed to be based on the cost of the electricity produced plus a reasonable return for the producer” said David Coon, Executive Director of the Conservation Council of New Brunswick. “The proposed price is too low to enable communities to develop renewable energy projects. They just won’t be able to afford it.” In Ontario, where prices paid reflect the cost of installing renewable power technologies, wind power projects are paid between 13 cents and 19 cents/kWh and solar beteween 40 cents and 80 cents /kWh. These prices have resulted in contracts for over 4700 MW of new renewable power projects in less that 2 years.
The new Community Energy Policy also does not guarantee access to the grid as a true feed-in tariff program should. The initial phase of the will consist of 75 MW, of which 50 MW will be assigned to community-owned projects and the other 25 MW to First Nations projects. To qualify under the policy, projects must not be larger than 15 MW in capacity. They must be majority-owned by First Nations, municipalities, co-operatives, not-for-profit organizations or institutions. New Brunswick-based private corporations and investors may be minority partners.
In September 2010, the Conservation Council of New Brunswick joined with CanREA member Falls Brook Centre and many other organzations to publish a Greenprint – Towards a Sustainable New Brunswick. On energy, the Greenrprint recommended that New Brunswick:
1. Revise the provincial feed-in tariff policy by adjusting the rate structure to ensure that projects can be economically feasible and by expanding the program’s eligibility beyond community-based projects (to individuals, businesses, etc.). Double NB Power’s requirement to supply new renewable energy from 10 to 20%.
2. Provide tax incentives for cooperative and community ownership of renewable energy.