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WFC Grades North American Feed-in Tariff Programs

Posted on Thursday, May 27th, 2010 at 3:33 pm by Paul Gipe

Ontario and Vermont Pass—California & Oregon Fail

The World Future Council has issued a report grading North American feed-in tariffs for renewable energy. Only Ontario and Vermont make a passing grade. All other programs in the US and Canada failed to pass.

The report, Grading North American Feed-in Tariffs by renewable energy industry analyst Paul Gipe, compares North American programs to successful policies in Europe.

Gipe evaluated the programs using ten criteria that have been found critical in creating successful renewable energy policy. He then devised a weighting system to reflect the relative importance of each criterion. Most criteria received 10 points, some less. Tariff differentiation by size or application, a hallmark of successful programs, received 20 points.

  • Program caps, 10 points
  • Project size caps, 10 points
  • Contract terms, 10 points
  • Technologies included, 10 points
  • Tariffs based on cost of generation, 10 points
  • Tariffs differentiated by technology, 10 points
  • Tariffs differentiated by size or application for each technology, 20 points
  • Tariffs differentiated by resource intensity for wind energy, 10 points
  • Inflation indexing, 6 points
  • Bonus or social adders, 5 points

Subsequently, Gipe compared the programs found in Germany, France, and Spain. Worldwide, the policies in these countries are considered the gold standard of feed-in tariff design. These programs are top in their class and are known to work well.

In Gipe’s arbitrary grading system, France and Germany each earned 90 points and were both awarded an “A”. Spain’s program earned slightly less, 80 points, and was awarded an “A-”(A minus).

For the report, Gipe then graded the feed-in tariff programs in various US states and Canadian provinces and ranked them. He did not grade municipal programs like that in Gainesville, Florida.

In the American system of grading “A” is excellent; “B” and “C” are good; “D” is poor, but passing; and “F” is for failing, or unacceptable performance.

Ontario, which has a sophisticated program modeled after those in Europe, ranked the highest with a total score of 84 points for a grade of “A-”. Oregon ranked the lowest with a score of 16 winning it a very solid “F”.

Vermont was the only program in the US to pass. Gipe gave Vermont with a score of 54 a “D” for effort and noted that Ontario’s first attempt at a feed-in tariff policy, the Standard Offer Contract Program, also qualified for a “D”. Most jurisdictions take several attempts to get their programs working right and Vermont is no exception.

Onetime trendsetter California pulls up the rear with only 28 points. At last count the Golden State’s feed-in tariff resulted in the installation of only 14 MW.

  • Ontario (2009): 84, A-
  • Vermont: 54, D
  • Maine: 43, F
  • Wisconsin IOUs: 36, F
  • California: 28, F
  • Oregon: 16, F

The report also examined proposed legislation in Indiana and California using the same criteria. Indiana’s AB 1190 introduced by Representative Matt Pierce qualified for an “A-” with 82 points. California’s AB 1106 introduced by Representatives Felipe Fuentes and Ira Ruskin earned only 54 points giving the proposal a “D” grade.

The World Future Council is an EnNGO based in Hamburg, Germany with offices in Washington, DC and San Francisco, California.

Gipe is an independent analyst and renewable energy advocate in Bakersfield, California.

-End-

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