ONT ONLY - microFIT solar panel program: 10-14% return for 20 yrs * FAT LADY HAS SUNG
With the required approvals, if you install up to 10kW of solar panels the Ontario Power Authority (OPA) will commit to paying you a fixed kWh you produce for 20 years. It is much higher than you pay your hydro company because it is designed to compensate you for the cost of the panels/equipment.
An application only costs $10-30 (to get your parcel register) and commits you to nothing. It does however give you the opportunity to get in on the the microFIT program at the current price. Once you've applied you can start getting quotes from and interviewing installers so that you are ready to go when you are approved.
If you are interested in NET METERING, check out this thread.
microFIT price/thread history
Program paid $0.802 per kWh for rooftop solar installations ($0.642 for non-rooftop). Price of equipment was roughly double what it is today.
April 5 2012
Prices of Equipment dropped and program rate was reduced to $0.549 per kWh.
April - June 2013
Prices of equipment dropped but program rate hadn't so rate of return was estimated at 18-20%. I got into the program (panels went live June 20, 2013) and started this thread to let others know about the great opportunity.
August 26, 2013
Program rate was reduced to $0.39.6 per kWh. Estimated rate of return was 10-14%
September 30, 2014
Program rate was reduced to $0.384 per kWh. Estimated rate of return was 10-14%
January 1, 2016
Program rate was reduced to $0.296 per kWh. Estimated rate of return is 8%. After taxes works out to the equivalent of a 7% total return on stocks (dividends + Capital Gain). Not so great considering the illiquidity of the investment.
- Great return, quasi-government guaranteed
- Panels will continue to generate electricity after 20 years, so you'll go from generating revenue to saving electricity expenses
- Most people don't like the look (unless you are into conspicuous conservation)
- Illiquid investment. Although there are different options on what you can do if you sell your home after installing the panels it is difficult to be certain how much your value would be increased. Options are: take the panels with you (but contract is terminated), rent the roof from the buyer for the remainder of the contract, sell the panels and contract.
- Upfront cost is about $30K.
Useful e-book from OttawaSolarPower.com that has lots of answers.
Link to microFIT program site: http://microfit.powerauthority.on.ca/
Suggestions on how to complete your microFIT application (based on 2013 application)
Instructions on how to do the annual tax reporting.
Instructions and tips on how to do your HST reporting.
A bit of background on how/why I started this thread
- Found out about the program and did my research. Decided it was a crazy good opportunity for investment as panel costs had dropped and the OPA was still paying 54.9 cents. Posted the thread here.
- Completed my OPA and local hydro company applications. Installers will do this for you but I didn't want to feel obligated to an installer and also it was pretty easy (instructions below)
- Interviewed 5 local installers and focused on the ones that had been in business the longest. Selected Downunder Solar.
- Had my panels installed with Enphase micro-inverters and the went online June 20, 2013.
- My forecast return after costs is 17.5% a year for 20 years.
- I was generating 15-20% above estimated output through November, but as a result of the unusual ice and snow in Dec 2013 and Jan 2014 I ended up with 100% of estimated.
- As of December 2015 my panels have generated 103% of estimated production (lifetime).