. /.   WORLD TRADE  
ORGANIZATION  G/SCM/Q2/CAN/44 
10 June 2010 
 (10-3176) 
Committee on Subsidies 
and Countervailing Measures Original:   English 
 
 
 
SUBSIDIES 
 
Replies to Questions Posed by JAPAN1 Regarding the New  
and Full Notification of CANADA  
 
  The following communication, dated 8 June 2010, is being circulated at the request of the 
Delegation of Canada.  
_______________ 
 
 
 (i)   Is it a correct understanding that th e OPA ensures the payment of the "contract 
price" if the suppliers of renewable energy run the Contract Facilities which are developed and constructed such that the Domestic Content Level is equal to or 
greater than the Minimum Required Domestic Content Level"? 
 
Reply
 
  Under the Feed in Tariff program the OPA will enter into contracts with renewable energy 
suppliers.  The FIT program provides a price schedule for renewable generating facilities by 
technology (onshore wind, offshore wind etc.).  The FIT program includes a domestic content requirement for wind power projects with a capacity greater than 10kW and solar projects.    
 (ii)   Is it a correct understanding that the "contract price" is set to support the 
income of the suppliers or the price of renewable energy, which is traded at the 
market price without the FIT Programme? 
 
Reply
 
  The FIT tariff is calculated so as to provide a price that will allow the generator to recover all 
of its capital and operating costs and ear n a commercial return on equity.   
 
 (iii)   Is the "contract price" higher than the market price?  
 
Reply
 
 
 As indicated above, the FIT tariff is calculated  so as to provide a price that will allow the 
generator to recover all of its capital and operating costs and earn a commercial return on equity.   
                                                      
1 G/SCM/136.   G/SCM/Q2/CAN/44 
Page 2  
 
   (iv)   Is the OPA, established by the Electricity Restructuring Act, 2004, a public body 
owned by the Government of Ontario? 
 
Reply
 
 
 The Ontario Power Authority is a corporation without share capital ( Electricity Act  (25.1 (1)).  
It has the capacity, rights, powers and privileges of a natural person ( Electricity Act  (25.2(4)).  It has 
the right to enter into contracts relating to the procurement of electricity supply and capacity using 
alternative energy sources or renewable energy sources to assist the Government of Ontario in achieving goals in the development and use of al ternative or renewable energy technology and 
resources (25.2 (5) (c)).   
 
 (v)   Is it a correct understanding that th e "contract price" is not applicable to 
suppliers who run the Contract Facilities which do not meet the Minimum Required Domestic Content Level? 
 
Reply
 
  The contract price under FIT is applicable to projects meeting the program's eligibility 
requirements.  For wind power projects with a capacity greater than 10kW and solar projects, 
eligibility requirements include mee ting a domestic content level.   
 
     (vi)  Are there any supplier who has met the Minimum Required Domestic Content 
Level since last October when the FIT programme was initiated?  If any, what percentage of FIT contractors has met it? 
 Reply
 
  In April 2010, 184 contracts were approved under the FIT program (contracts were approved 
earlier for smaller projects under the microfit and capac ity exempt categories).  In agreeing to these 
contract conditions these suppliers have accepted th e domestic content requirements.  Projects have 
not yet been built given approvals  and construction requirements. 
 
__________