Banff’s production based top-up incentive program to encourage residents and businesses to install rooftop solar systems is switching to an upfront rebate program.
On Tuesday (May 23), council approved the change following an administrative recommendation, with a new up-front program matching a new provincial solar rebate to a maximum of 7.5kW.
The provincial rate is widely anticipated to be about 0.75 cents per watt of solar capacity, and predicted to reduce residential solar installation costs by up to 30 per cent and up to 25 per cent for businesses and non-profits.
Councillor Grant Canning said he believes more people are likely to participate if they get the money up front at the time a solar system is installed, noting there’s $150,000 in the environmental reserve to fund this.
“I think it’s a lot better to get the money up front, rather than being paid over a longer period of time,” he said. “I like the idea of matching what the provincial rate will be.”
There have been 21 rooftop solar photovoltaic systems installed in Banff since the top-up incentive program began in 2015. Banff was the first municipality in Canada to offer such a program.
Shannon Ripley, the Town of Banff’s environmental services manager, said it has proven popular.
“It’s a clean energy source,” she said.
The original program model, with a budget of $300,000, was designed to set a top-up payment rate that would support participants in getting a seven-year simple payback on their solar systems.
A recent third party review indicated top-up payments over seven years for 2015-16 participants would be $310,000. Between 2017-2022, top-up payments will amount to between $43,000 and $45,000, meaning the program is currently fully subscribed.
Ripley said the review also showed several participants are not on target to reach a seven-year payback because their solar systems were affected by significant shading or weren’t south facing.
She said systems facing south with minimal shading are expected to generate 1,000 kWh or more of electricity per kW of capacity installed; however, those with generation rates of 800 and in less optimal locations would see a 12 to 14-year payback.
“There were, however, three participants that have generated more than 1,000 kWh electricity for every kW of solar installed,” said Ripley, noting they generated between four and 24 per cent more electricity than expected.
On top of that, electricity costs on the provincial grid are at an all-time low and, while energy analysts predict they’ll climb again, the timeframe for that is uncertain.
“The lower the average price of electricity, the lower the cost of the electricity that a solar energy generation system offsets, and therefore, the longer the payback period,” Ripley said.
“The drop in electricity prices adds approximately one year to the projected payback period for most solar PV installations.”
The change to the incentive program will have no immediate implications for 2015 and 2016. Administration plans to explore options to pay out current participants more quickly than over the seven years to reduce an administrative burden.
Ripley said administration has found it increasingly challenging to administer the program, noting there have been various technical difficulties for the e-gauge devices installed to measure solar generation.
Mayor Karen Sorensen declared a conflict on the issue because she has applied to be part of the next round of funding, and Coun. Chip Olver also declared a conflict because she took advantage of the program in 2015.
