We are glad anyway that we decided last year to cease installing solar thermal systems since the last remaining incentive was cancelled last week (The Eco-Energy programme was giving a rebate). This Federal Programme was cancelled 2 months early and will peter out in March.

The prices we have to pay for solar panels is creeping up again, one supplier is shipping unwanted product to the USA rather than dump it in Ontario where demand has died.

Our new web site is up and running but the e-store hasnt been activated–shouldnt be long now. We aim to supply Torontonians with the 12 volt panels,  inverters, charge controllers and batteries for their cottages and cabins.

Changes have been made in the ownership of our company and the 2 co-owners now are Bharat Desai and Mark Ogilvie. Rick Balmer is Sales Manager and Prasenjit Pal is a Solar Consultant.

We will be looking at FIT projects going forward, and now have access to excellent financing for our clients.

Mark Ogilvie

In Ontario some folks who prepared submissions to Ontario Power Authority to be considered in their review of the Feed-In Tariff based their proposed rates on reaching grid parity within 20 years.

Meanwhile the price of solar panels has been falling rapidly because of a drop in the cost of silicon cells and manufacturing efficiencies.

So, as solar arrays become cheaper and more of a commodity, the public will expect lower installed prices. The rates paid for solar electricity will be lower. So labor and electrical and administrative costs will be squeezed. Margins will be lower, volume higher. Installers will need to be busy, moving from one job to the next, working with low profit margins, and there will be consolidation as well as installers falling by the wayside. It’s becoming a mean business, a “real” business, no more “gold rush”. No more “feel good”. A good thing perhaps if volume increases as prices drop.

Today’s Toronto Star Headline “Denied hike, Hydro axes jobs” could have repercussions in the form of delays connecting microfit projects to the grid. I hope I am wrong about this but seems that microfit projects will probably continue to be low on the priority list so barring a change in priorities I think it is safe to assume that the wait for connection will be longer.

Solar projects deliver energy where its needed since the electrons don’t go further than neighbors’ homes so theoretically, the more pv systems connected, the less the need to upgrade the local distribution system. If Toronto Hydro sees it this way perhaps they will place more importance on making our connections.

High Finance.

A meeting with a financier last week-end was very favorable and it looks like we can soon arrange financing for FIT systems at 6% over 18 years. An excellent deal for owners of large flat roofs seeking to invest in the guaranteed returns offered by the Feed-In Tariff.

During 2012 we will be approaching holders of unbuilt FIT projects that are stranded by lack of financing to offer this excellent package in tandem with our very experienced installer partner.

Jan 11,2012

Our installers are finishing the remaining tasks on our projects and it appears there wont be any carry-over into 2012.

What will the next year of business be like for Down-To-Earth Solar?

The last 2 years both began with high expectations but foundered on the shoals of uncertainty and delays emanating from the regulatory side of things. It seems we are in an industry that is dependent for its well being on political interests, a factor I did not fully appreciate when I started the company. Ontario’s  Green Energy Act and its offspring the Feed-in-Tariff provide the incentives and the programme is an excellent one in principle. As they say, the devil is in the details and the details keep hanging up the programme because whenever a snag is encountered the preferred way to fix it is to stop granting conditional offers, thereby starving the industry while the means is found to make whatever changes are eventually deemed necessary.

Probably, the large and experienced foreign companies that have set up business in Ontario to exploit Ontario’s Green Energy Act can wait it out and keep their staff employed but a small company like ours need stability in order to keep in business. By way of example, we started a commissioned salesman in September. He has proved exceptionally able and is working with a number of clients who were great prospects for investing is Solar installations. Then at the end of October came an announcement from the Ontario Power Authority that not only was their 2-year review underway but applicants who applied as much as 60 days prior would not be granted contracts under the existing terms but under whatever the new terms are when agreed in January of February. Without new customers how does our salesman pay his mortgage? How do we pay the rent?

We are concerned that to avoid flack from ratepayer groups and the opposition Conservative party, the new feed-in-tariffs may be too low to provide any incentive to buyers. Input from optimistic industry groups are pegging the new rate for microFit projects  at $0.70 per kWh. I say if we get $0.70 and some regulatory stability, 2012 should be a good year for us.

Buyers can be greedy! With the current rate of $0.802 per kWh we were able to show a simple payback in one case of 7.5 years and to our amazement, the homeowner said that was not good enough!  Where else in today’s economy can you get 12% return on investment? To be fair, occasionally we do run into some very nice people whose primary concern is the environment rather than the money.

Let’s hope 2012 bring us lots of those customers.

The owners and staff at Down-To-Earth Solar wish all readers a Happy New Year.