April 3, 2012

FIT Contract Management UpdatePerry Cecchini, Manager FIT/RESOP

Ontario FIT Forum

Outline

1. Contract Milestones:

1. Contract Offer

2. Notice to Proceed

3. Commercial Operation

2. Compliance Audits

3. Questions

Introduction

• Two different teams at the OPA work directly on the FIT Program: – Procurement Team; and

– Contract Management Team.

• OPA Procurement Team looks after FIT Applications from review to offering FIT Contracts.

• Contracts once accepted will be looked after by the Contract Management Team.– There is an analyst is assigned to each FIT Contract

FIT Contract Milestones

1. Contract Offer

Supplier must execute the FIT contract cover page.– Supplier acceptance timelines (including submission of performance

security) must be met

2. Notice to Proceed (NTP) • Complete NTP request submission includes:

– NTP Request Form– Financing Plan– Domestic Content Plan– Applicable environmental approval (Renewable Energy Approval or

equivalent) – Impact assessments (If NTP application is submitted after the expiry of an

impact assessment, evidence of a Connection Cost Recovery Agreement must be submitted).

FIT Contract Milestones

2. NTP (Continued)• There is an NTP Request deadline that Suppliers must meet.

– Milestone Date for Commercial Operation for Small FIT facilities (or Capacity Allocation Exempt facilities under generation one contracts)

– Six months prior to the Milestone Date for Commercial Operation for Large FIT facilities (or Capacity Allocation Required facilities under generation one contracts)

• Failure to meet these deadlines is a Supplier Event of Default. • Incremental Security is required within 30 days of receipt of Notice

to Proceed.

FIT Contract Milestones

3. Commercial Operation Date (COD)• COD Requirements

– Exhibit F – Suppliers Certificate– Exhibit G – Independent Engineer’s Certificate – Single Line Diagram (as built)– Metering Plan (if required) or evidence that meters are

Measurement Canada approved.• Failure to bring a facility into commercial operation on or prior to the

Milestone Date for Commercial Operation could lead to:– Partial loss of Contract Term – Liquidated Damages (in certain situations)– Supplier Event of Default (in certain situations)

Compliance Audits

• The FIT Contract provides the OPA with broad audit rights. • The OPA is currently conducting a Domestic Content

Compliance Audit on certain FIT contracted facilities that reached COD prior to December 31, 2011.

• Facilities chosen for audit were selected randomly and Suppliers were notified on March 23, 2012.

• The deadline for Suppliers of audited facilities to submit requested documents is May 07, 2012.

• The OPA expects to conduct periodic Compliance Audits.

Thank you!

Questions and Comments?