Are Operating Feed-in-Tariff Projects Safe from Termination by the Ford Government?

Are Operating Feed-in-Tariff Projects Safe from Termination by the Ford Government?

 

Rachelle McCann, P.Eng.

Senior Consultant at Compass EnergyConsulting

 

The Ford government has proven that it is taking all available opportunities to go after executed FIT contracts, with the termination of 758 renewable energy contracts in July 2018 and the recent release of MCOD letters from the IESO for FIT contracts that have not yet reached Commercial Operation (COD), effectively removing up to 18 months of development time depending on the renewable fuel type.

Now the Independent Electricity System Operator (IESO) has launched a new round of audits focusing on Domestic Content compliance. Wind and solar Feed-in-Tariff contracts from round 1 and 2 (FIT1 and FIT2) are subject to domestic content requirements, which accounts for over 2,300 wind and solar contracts currently operating in Ontario. The IESO audit request typically requires a short turn around time to provide the numerous required documents. The required documents typically include manufacturing records, shipping records, purchase orders and invoices, prescribed forms, and in some cases statutory declarations and labour hour timesheets. This can result in a significant amount of paper. Be prepared by ensuring your domestic content supporting documentation is sufficient and ready for submission.

Compass has evaluated numerous manufacturing supply chains for local content, assembled the required documentation, delivered domestic content reports and audit binders, and reduced domestic content risk for over 200 MW of FIT contracts.

How Can I Reduce My Risk?

Do you know if your Domestic Content documentation is prepared and ready to be quickly submitted to the IESO upon receiving an audit notification? In most cases the important documents and information are not maintained in-house by the current FIT Contract owner. This leaves you open for exposure to delays and possible non-compliance with IESO deadlines. In some cases, the companies involved in the supply chain could be out of business or not have maintained the required documentation. This can result in significant delays and increase risk of non-compliance in gathering the information and documents that the IESO needs to see.

Compass can reduce your risk of non-compliance by working with you to gather the required audit binder materials and review and evaluate them for completeness and accuracy. Compass will identify gaps in documentation from your supply chains and suggest remedies or alternate documents to be gathered.

Reach out today to Compass and give yourself more time to collect the required audit binder materials. Feel free to contact myself, Rachelle McCann at rachelle@compassenergyconsulting.ca for more information on how Compass can help you reduce your risk.