Can you briefly introduce yourself and your company?
PURE Energies is a Canadian company based in Toronto. PURE Energies brings international experience to Ontario in order to provide a full turnkey solution for residential solar PV. Our solution is simple: we design, install, finance and operate residential rooftop systems with a twenty-year performance guarantee without any upfront cash and without any credit checks. PURE Energies provides only the highest quality solar components and uses best practices for installation in Ontario. PURE Energies offers home owners across Ontario a hassle-free solution for adopting solar PV that is both economically viable and aesthetically pleasing. With PURE Energies everybody saves money and makes a difference.
How was 2010 for your company?
2010 was awesome. We exceeded our forecasts on the customer acquisition front and received a lot of media exposure across Ontario. We started to install during late fall and have not stopped since.
What are your expectations for the PV market in Ontario in 2011?
I am not in the prediction business but 2011 will be an important year in Ontario as we will see after a year how many MicroFIT contracts (MicroFIT projects are micro-generation projects that are less than 10 kW and receive a FIT of 80.2 cents a kWh) will actually materialize and get connected to the grid. The number of contracts approved is pretty impressive but capital, connection, and availability of systems meeting the domestic content requirements will be the limiting factors for some. 2012 will be the year of market consolidation and it should start this coming fall.
How is the division of market shares in Ontario between residential, commercial and utility scale PV plants? What trends do you see?
Since the beginning of the Program launch, the 1 MW + ground mount utility scale contracts have been awarded first in substantial quantities but up to now only a few have been ready to implement under the FIT Program. Everything that has been commissioned so far has been under the RESOP Program that was first launched in 2006. From an activity perspective, last year we saw the greatest competition occurring in the commercial rooftop segment (sub 250 kW) and in the rural ground mount (10 kW). Now, due to some connection restrictions in rural areas and some industrial parks, many players are becoming more interested in smaller-size systems in urban areas.
What do you expect to happen next year (with respect to demand)?
On the equipment side the demand for solar PV systems will be peaking next year as a lot of utility scale projects awarded over last 18 months will need to be installed.
Is there any risk that the authorities will reduce the FIT because of its success, like what happened in Germany and Italy?
We believe that over time, if the IRR improves for developers, the Ontario Government will reduce the FIT rates based on the cost of equipment available meeting the required domestic content laws.
Some resistance seems to exist in the USA against the lease model for residential PV systems. Do Ontarian customers prefer the lease model over buying and owning a PV system of their own?
We do not have any pushback on the leasing model. Ontario is a different market as electricity costs are in the sub-$0.10/kWh and solar PV + snow is perceived as a risky business to be in. Also, PURE Energies’ model is different to the leasing model in the US. We do not take homeowner credit risks therefore we do not annoy them with harsh credit requirements. We have a feed-in tariff based on two meters (a revenue meter and a consumption meter) - no net metering PPA. Actually the customer buying the system in Ontario is in a different market segment (higher net income, high awareness and knowledge of Solar PV, very green).
How is the PV market developing in other Provinces in Canada?
Some rumbling in the west. We are following it very carefully.
How is the 'local content requirement' working out in Ontario? What is your opinion?
As a developer in Ontario, I would prefer to pay less for a PV system and not have the DC requirement, as DC-compliant components are significantly more expensive. As an Ontario ratepayer, I believe it makes sense and it is the trade-off for a good FIT rate. So, if we believe that having a DC requirement can build a sustainable industry in Ontario, and we keep the FIT Program open longer – that’s a good thing.
What, in your opinion, are the biggest challenges in your market today? And what should be done to solve the current problems?
Political “wrestling” using the Green Energy Act, bureaucracy and permitting costs with some municipalities, connection issues with local distribution companies, insurance companies not yet understanding solar PV... I believe awareness through exposure and education is key in order to ensure a streamlined solar PV ecosystem in Ontario. It takes time and it’s a burden to our business.
What system prices will be needed to make solar PV a competitive solution for residential customers in Ontario, without the need for a FIT?
It’s a tough one. From a customer perspective, with insulations in the 1300 kWh per kW and utility costs in the sub-$0.10 per kWh it will still take some major cost improvements to get a reasonable payback with subsidies. But the perspective from the point of view of the OPA (Ontario Power Authority) and the MEI (Ministry of Energy and Infrastructure) is quite different because peak power during some summertime in Ontario costs $0,50-01,90 per kWh to produce. Also, the grid would require some improvements if we decide to build some massive nuclear or natural gas plants. Therefore we believe that the Government will be inclined to procure power through developers such as PURE Energies who are working in highly dense areas.
Finally, where will the position of your company be 3 years from now and what will be the biggest challenges to achieving your goal?
PURE Energies will be the number one solar residential developer in Ontario, and one of the top 3 in North America (in MW) and we will be looking at new jurisdictions to continue growth. In order to achieve this, we need to continue our awareness work inside the ecosystem; we need the FIT Program to continue - and a lot of work and luck...
More information on PURE Energies can be found on www.pure-energies.com