Hydro One addresses grid connection problems

Wednesday, March 4, 2009

© AgMedia Inc.

by GEOFF DALE

A Wednesday meeting between Hydro One officials and members of the AgriEnergy Producers’ Association of Ontario was a productive first step in addressing energy connection problems facing farmers, says the association’s executive coordinator.

“Hydro One certainly wanted to talk to those people who have been taking their complaints public . . . because this has given them a black eye,” says Nicole Foss.

She says Hydro One officials admitted improvements to the connection system will take considerable time and agreed to rectify some technical concerns such as dropping the requirement for farmers to cover the costs of high voltage interrupters (switches for disconnecting transformers), which can cost $250,000 to more than $1 million. Such costs can make energy projects uneconomical for farmers and small community-based operations, she explains.

Hydro One has also agreed to look into establishing connection standards. “Hydro One never says exactly what it wants from a project, leaving the producer guessing what is acceptable. It’s like re-inventing the wheel every time.”

With no set standards in place, Foss says farmers must absorb the cost of engineering work. If officials say reject their projects, it means going back to the drawing board, resulting in “hugely disproportionate” costs.

This week’s meeting comes on the heels of an Ontario Energy Board February announcement that it would amend the distribution system code to make it easier for smaller-sized generation projects to connect to the grid.

But Foss says many farm and community-based projects still face roadblocks.

The board changes fast-track smaller generation projects of up to and including 250 kilowatts on lines less than 15 kilovolts or projects of up to and including 500 kW on lines greater than or equal to 15 kV.

“Because the limit is 15 kV for the line, that really doesn’t help an enormous amount of farmers because lines in rural Ontario are usually 8.3 or 12.5 kV,” Foss explains.

She says securing a spot in the queue can also add costs, pointing to one farmer who was saddled with a more than $1-million connection impact assessment fee.

Paul Klaesi, a Cobden-based dairy farmer, says connecting to the grid took more than two years, adding he has already spent more than $400,000 for a project he hopes will generate a yearly gross of $200,000-$300,000.

“At 500 kW we are fairly small but we still face deep entry costs like replacements, equipment upgrades and building a power line,” he says. “If you’re lucky you might get a cost-shared agreement with Hydro One but only if you can prove they can use the line.”

Another APAO member, New Hawkesbury dairy farmer George Heinzle, says the biggest problems he faces are the lengthy timeframe and costs, noting he has been waiting for 13 months since applying to hook-up a second 180kW generator.

“It cost me $34,000 for the first generator and all Hydro One did was to put a pole in and plug in wires,” he says. “It will cost me another $100,000 for the second generator and we’re being told we also need to change transformers, which means more costs.”

Following Wednesday’s meeting Foss sounded a note of optimism, saying Hydro One officials are acknowledging there are problems and want to attend the association’s next meeting which has yet to be scheduled. BF