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| NEWSLETTER # 42,
JUNE 2006 |
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INVESTING IN RENEWABLE ENERGY
The greatest obstacle to many who have decided to purchase a renewable energy system is the upfront capital cost. Usually, when one finds out the cost of producing electricity, they wonder, 'how will I manage the cost?' Unfortunately, the current state of affairs in Ontario places a heavy economic burden upon those who wish to generate electricity from renewable sources. The most important step toward renewable energy generation must therefore involve a very intensive examination of personal energy use and the role of conservation. Once the size of the system required is determined, one must figure out how to finance it. If one has the financial means to purchase their system outright, or has a plan to purchase portions of their system over time as their finances allow, then no outside financial help is required. However, if one is not in such a strong financial position but has other assets, there are other options available. If one owns their own home, its value can be used to obtain funds in the form of a mortgage. With mortgage rates fairly low at this time, a mortgage may prove an acceptable option. The borrowing costs, however, add to the total cost of the energy system. But, what if your mortgage interest can be paid back to you? Let's examine a possible scenario. If anyone has invested into an RRSP, this tax saving opportunity can be used to the advantage of your renewable energy system. Initially, one must convert sufficient funds in their RRSP into a self-directed type of investment plan (which most financial institutions allow). Then one applies for a mortgage and borrows from their RRSP, which now becomes the mortgagor. Ironically, ones interest cost goes back as income into their RRSP fund. All the regulations involved in a standard mortgage must be followed. But since this scenario is considered a non-aims length agreement, other rules also apply. The mortgage must be approved by the CMHA (Canadian Mortgage and Housing Authority) and the bank. The interest charged must be the posted mortgage rate of the bank. The mortgage must be insured. A one time set-up fee and a yearly administration cost is charged to the RRSP fund. But, in order to make this type of mortgage financially competitive, a mortgage amount of at least $30,000 would be required. The advantage of this type of financing is very subtle. The individual takes greater control of where their money is being invested. Their RRSP fund is being used for renewable energy production and to promote a greener, more environmentally friendly lifestyle. Making such a philosophical decision with one's assets can be expanded to help others as well. If one possesses extra RRSP funds, why not invest in the renewable energy dreams of others by offering them a mortgage under this self-directed RRSP approach? Too often we give money to the banks for investing and only care about our return on investment and forget where and in what the money has been invested to get that return. What a great way to become more pro-active in our finances, investments and future. But, this proposal is only one possible approach that awaits the green genius of our time. We look forward for the green genius in all of us to appear. If you have any questions please contact Vitold at 519-923-3005
ASK THE EXPERT - Electricity and Cooking Q: Is there any way to cut down on electricity use for cooking?" A: We have been experimenting with cooking in a blanket for a couple of years now with excellent success. This method saves approximately 75% of the cooking energy. It does take a little more time and planning. You take your dry beans (pre-soaked), potatoes beets (no matter how big), rutabaga, soup, grains, (even rice - with a little less water and some practice), bring them to a rolling boil for at least one minute and wrap the pot in a blanket to continue cooking. This can happen worry-free overnight or you can put your food in the blanket in the morning and come home to something cooked. Dry beans depending on the type and the freshness sometimes need more cooking time initially or a second round in the blanket. Potatoes will be suitable for mashing if left in too long. Practice with timing of different foods will result in best results. Woolen or even cotton blankets work the best and keep the heat in. This is also an option to wrap up cooked food to keep warm (vs. an oven). Nylon blankets smell bad - they start to melt with the heat! When our house is built we plan to have a drawer in the kitchen lined with fleece with a felted fleece cover as a permanent cooking drawer. It's worth a try and works well for most things. If you have any questions please call Christine Forand or Lynn Stoltzfus 519-369-1440
THE ART OF ADVOCACY
Many people wrongly assume that the politicians run everything, and if you want something changed, all you need to do is write to the politicians. Nothing could be further from the truth. Especially in the electricity sector. I am the founder of Sky Generation, a wind development company that erected the Ferndale wind turbine. I came to the wind business from the computer wholesale business. In the computer business, you compete based on your wits. If you have the right product, the right sales people, treat your customers well, and good cost control, you will succeed. Government is largely out of the way. When I entered the wind business, I studied the industry. The conventional wisdom was that the key issue is wind resource. If you have better winds, you produce more power. I set out to find good winds. You also need connection at low cost, and that means you need to be near the power grid, at a voltage and conductor size that would accommodate the output of the turbine. But then I ran into a barrier. The price of electricity in Ontario was too low to build wind. But it was not that the cost of wind was too high. It was the subsidies lavished on the nuclear plants, and the failure to recognize the health and climate change cost of burning coal in the price of power. Wind did not have the right policy environment to participate. Property taxes taxed wind out of existence. Connection fees were high. Utilities required expensive protection and control systems that were unnecessary. Zoning rules were a hodge- podge. Crown land had no policy to allow construction of wind, and was 87% of Ontario's land mass. And the price from other competing sources were too low. So I became a part time volunteer lobbyist. We formed the Ontario Wind Power Task Force. We obtained the co-operation of the Ministry of Finance, the Ministry of Natural Resources, the Ministry of Municipal Affairs, and the Ministry of Energy, who sent representatives to sit on the task force. We studied the policy environment elsewhere, to see what works. We analyzed the potential for wind energy to make a contribution to supply in Ontario. We reviewed the jobs and economic development opportunity. We studied taxation issues. And we prepared a report. And it was the report that began the reform of some of Ontario's policies. It was a document based on reason, not political pressure. It built the case for wind in Ontario. And it was well received. In the process, we educated numerous bureaucrats, who provide advice to the politicians. It was this education of the bureaucracy that perhaps made the most difference. Politicians come from all walks of life. They are not experts on electricity. When utility engineers tell them the system won't work if they make a change, they have no choice but to listen. So it is critical that the bureaucracy and utility engineers, who offer advice to politicians, understand the issue, and at least acknowledge some of your position. Policy is derived from legislation. It is the politicians who introduce legislation, but of course it is drafted by bureaucrats. The bureaucracy and regulators then operate under the authority of the legislation, and must do so until the legislation changes. And legislation often gives wide latitude to the bureaucracy to make important and significant changes, with or without political direction. If you want tariffs change on connections to wind turbines, it is the local utility, and the Ontario Energy Board who decides. Not the politician. The politician can introduce legislation to make a change, but it is time consuming to do so, and so it rarely happens for micro issues. These issues always remain in the purview of the bureaucracy and regulators. Ontario is not the Shangri-la of wind policy yet. But it much improved over where it was. It has taken years to get to the point where some wind is being deployed, and where major policies such as the Standard Offer Program are underway. If we use an analogy, the advocacy work at the bureaucratic level is the ground war. But at the end of the day, the politicians make the decisions. And they don't always know what the public is thinking. I had a Liberal MPP for a tour of the wind turbine, as she was investigating the opportunity for renewable energy in re-vitalizing the rural economy. She asked me point blank, "Do you think the people of Ontario are ready for a large amount of wind energy?" The question floored me. My project has been very well received by the public, and not just by environmentalists. I was certain that the public was not only ready, but eager. Wind energy just makes sense to a lot of people. But she wasn't certain. That is why writing to politicians also matter. This is the air war, and it is vital to ensure that the politicians understand the viewpoint of the citizens. So letters, phone calls, and emails matter a great deal. That is the key lesson of lobbying. The politicians matter, yes. And making your views known to them is important. But those who provide advice to the politicians, who regulate, who administer, matter just as much. Glen Estill is the Founder of Sky Generation.
QUOTABLES...but some day we will harness the rise and fall of the tides and imprison the rays of the sun." Thomas Edison
The board of CFRE has been re-organized and has been increased to six directors in accordance with the amendment to our by-laws.
The remaining board members are:
Four committees have been created. They are being chaired by members of the board. They are: Workshops/Display Membership Fundraising
QUOTABLES...We have just a small window of opportunity and it is closing rapidly. There is not a moment to lose." Dr. Rajendra Pachauri, Chairman
Keynote speaker Janet Sawin, World watch Institute,
TAKING ACTION ON STANDARD OFFER CONTRACTS
Thank you, CFRE members, for the warm welcome at your 10th anniversary workshop and AGM. It was encouraging to see so many people dedicated to a sustainable energy future gathered in one place, and so many of them interested in the Standard Offer Contract (SOC) program. Although SOCs present an excellent opportunity for generators of renewable electricity, many CFRE members expressed concern regarding the limitations of the contracts. These concerns are valid; barriers still remain to the successful implementation of SOCs, particularly for homeowners who hope to sell electricity from solar photovoltaics. To ensure that embedded solar generation by homeowners will be eligible for the 42 cents per kWh offered for solar electricity under SOCs with a minimum of fuss, there are several steps that members of CFRE can take:
Although barriers remain to the implementation of a successful SOC program, SOCs present a great opportunity. The 42 cents per kWh offered to generators of solar electricity far exceeds the price value of net metering to the generator from a financial standpoint. The challenges that remain on the road to a successful SOC program can be resolved, but like everything, the process is political, and will require your continued support and guidance as the details come to light. In Germany, solar advocates had to push for many months to achieve a winning SOC program, but once they did, Germany quickly became the fastest growing producer of solar electricity worldwide. You are at the forefront of an energy revolution, poised to light the way for all Canadians. With a bit of elbow grease, Ontarians can mold SOCs into a powerful tool for individuals and communities committed to a sustainable future.
No, don't worry, Ziggy, the Coordinator is not gone with all the new positions being created! It is just to get him some help with all the many obligations he has been taking on. Of course, we don't want things to stagnate as it sometimes happens with old age, we need to venture on with new vigour! And, yes, we had a great celebration of our 10th Anniversary on a beautiful warm day, May 28th, at our favourite location YMCA Paradise Lake Outdoors Centre, where we always receive a warm welcome and generous service. After the coordinator took some time to go through the illustrious history of CFRE he received a good 'roasting' from previous and present board members and also a congratulatory message from CFRE's first directors, Hans Albarda and Cathy Stanley, who now live in Wolfville, N.S. Hans, who still is active in consulting our members has, by consensus, been appointed to an honorary director position for his longtime volunteer service. Our keynote speaker, Janet Sawin, from the Worldwatch Institute, Washington, D.C.,gave an interesting presentation " Have we reached the Tipping Point?", covering many issues from early societies to our using up non-renewable resources at a fast rate. She used telling statistics also touching on Climate Change. She graciously supplied the electronic version of her talk so we could display it on our website for those who were unable to attend. After a delicious lunch she made herself available for questions. She was followed by Alex Doukas from OSEA, the Ontario Sustainable Energy Association, which has after long and tedious advocacy finally succeeded to have the government announce a Standard Offer Contract(SOC) program for small generators of renewable energy. He gave an update on this program which is in some ways styled to the European Feed-in Tarriffs. The last presentation kept our audience paying keen attention: Liz and Frank Barningham, who just recently built an 'Albarda-style' off-grid solar powered home enthusiastically described their experience. They showed how an energy-efficient residence can give a comfortable sustainable life style. 'Barney' also went to all length to borrow video equipment to be able to record the morning sessions. 17 members gave of their time to take part in the 2-hour business meeting. The Coordinator's and Treasurer's reports were tabled and the amendments to our by-laws were approved. The Minutes of our AGM are available to our members on request. Have a great summer!
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