Canada: Five wind contracts totalling 299.5 MW awarded

The Independent Electricity System Operator (IESO) released today the list of 16 contracts that have been offered under the Large Renewable Procurement (LRP), a competitive process for procuring large renewable energy projects generally greater than 500 kilowatts.a

The 16 contracts offered represent 454.885 megawatts (MW) of clean renewable energy capacity. This capacity contributes to the achievement of the province’s renewable energy targets. The results include:

• five wind contracts totalling 299.5 MW, with a weighted average price of 8.59 cents/kWh;
• seven solar contracts totalling 139.885 MW, with a weighted average price of 15.67 cents/kWh; and
• four hydroelectric contracts totalling 15.5 MW, with a weighted average price of 17.59 cents/kWh.

Of these, more than 80 percent or 13 projects (336.8 MW) include participation from one or more Aboriginal communities, including five with more than 50 percent Aboriginal participation. Additionally, more than 75 percent of the successful proposals had received support from local municipalities, and more than 60 percent had support from abutting landowners.

The full list of contract offers, including project locations and contact information, can be viewed here.

The development and design of the program’s requirements, including those for community and municipal engagement, were informed by broad engagement with municipalities, Aboriginal communities, industry associations, the general public and other stakeholders. The LRP program requirements were designed to strike a balance between early community engagement and achieving value for ratepayers. Local support – either from the municipality, Aboriginal community and/or from landowners abutting the project – was a factor in project evaluation.

“This LRP process introduced strong competition among developers of large renewable projects, helping to drive down price and secure clean, reliable generation for the province,” said Bruce Campbell, President and CEO, IESO.

The price ranges for the contracts in each fuel category are:

• wind -- approximate weighted price range of 6.45 to 10.55 cents/kWh;
• solar -- approximate weighted price range of 14.15 to 17.85 cents/kWh;
• hydroelectric -- approximate weighted price range of 17.35 to 17.70 cents/kWh.

For context, these prices are lower than the Feed-in Tariff rates, found here.

The LRP process was administered by the IESO and overseen by an external fairness advisor. Robust and transparent public procurement practices were followed throughout the process, and each proposal was carefully evaluated for compliance against a list of specific mandatory requirements and rated criteria.

Once the contracts are executed, project proponents will need to meet a number of contractual requirements as well as environmental and permitting approvals before they can build their projects. This will include additional community engagement.

The IESO intends to seek feedback from stakeholders, municipalities and Aboriginal communities now that this LRP process is completed to understand what improvements can be made for future procurements. Formal engagement on the lessons learned from this LRP procurement and the development of the next round is expected to commence in late March 2016. An engagement plan has been posted at www.ieso.ca with additional details.