The Ontario Green Energy Act and Bullfrog Power

Recently, Bullfrog Power has received questions about the role of our company and product now that the Green Energy Act is in place in Ontario. The green power produced on behalf of Bullfrog's customers is independent of, and incremental to, the new renewable power being brought online as a result of this new legislation. In addition, by purchasing from Bullfrog Power, our customers are ensuring that 100% of their electricity needs are met with green power, rather than only a small portion (as is the case with the standard mix available to all Ontarians). The following explains this issue in more detail.

What is the GEA?
On May 14, 2010, Ontario's Green Energy Act came into force. It is a landmark piece of legislation — effectively providing North America's first Feed in Tariff approach to procuring electricity supply. It provides for, among other things, fixed tariffs for a number of different types of renewable generation. The feed in tariffs allow individuals to build renewable energy generating facilities and sell the electricity and the associated environmental benefits (i.e., emissions reductions) to the Ontario Power Authority at higher than market rates. For more information on the Green Energy Act, see www.mei.gov.on.ca/en/energy/gea/.

How much impact will the GEA have in Ontario?
Electricity procured under the Green Energy Act, and predecessor programs (the Renewable Energy Supply contracts and the Renewable Energy Standard Offer Program) already supplies about 3% of Ontario's electricity needs. This is estimated to increase to 5% by 2009, 9% by 2012ⁱ and by 2014, it is expected that 12-14% of Ontario's electricity will come from new renewable generation.

Bullfrog Power applauds the GEA
Bullfrog Power's vision is a future powered by renewable energy. As a result, we encourage governments and regulators across Canada to push forward legislation, regulation and policies that increase the percentage of new renewable power in the overall mix. We realize that most of the new renewable power developed in Ontario won't be procured or retailed by Bullfrog Power in the voluntary market — instead it will be built to satisfy government created demand. The GEA will increase the percentage of renewable electricity in the average rate-payer's mix.ⁱⁱ This is a great improvement — think of it as raising the minimum standards for Ontario electricity generation.

Bullfrog Power supplements the GEA
Bullfrog Power supplies consumers who would like 100% renewable electricity rather than the standard mix (for more information on the standard mix, click here). Voluntary purchases by bullfrogpowered homes and businesses supplement the Green Energy Act and increase the amount of renewable energy in the province.

Bullfrog Power's renewable electricity is separate from and incremental to the electricity being purchased by the Ontario Power Authority (OPA) under the Green Energy Act.

As a result, when consumers become bullfrogpowered, they accomplish a few things:

• First, they are choosing renewable electricity for their home or their business, and as a result their electricity is emissions free. This is different than someone who installs a solar panel on their roof under the Green Energy Act. While very commendable, the person who installs solar on their roof has sold the electricity and associated benefits to the OPA, and cannot claim that their own electricity consumption is emissions free (precisely because the OPA has bought that electricity and that right from the homeowner).
  
  
• Second, renewable power generators require more than the market price of conventional electricity to be economic, and a bullfrogpowered home helps to provide that incremental financial support
  
  
• Finally, bullfrogpowered homes and businesses support the development of new renewable generation over and above the Green Energy Act. To date, bullfrogpowered customers have supported the development of three wind farms in Ontario. Green electricity from these wind farms is not purchased by the OPA, and only bullfrogpowered homes and businesses buy the energy from these turbines. As the number of bullfrogpowered customers grows, the number of new turbines can also increase. After the OPA, Bullfrog Power, together with the support of its customers, is already the second largest purchaser of green electricity in Ontario.
  

ⁱ Ontario Wholesale Electricity Market Price Forecast, for the period November 1, 2010 through April 30, 2012, Navigant Consulting Ltd

ⁱⁱ This assumes that the OPA will retire the Environmental Attributes obtained under the GEA on behalf of Ontario rate-payers.