SOP: FAQ

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About our FAQ

These FAQs are for general information and don't constitute legal or other advice. If there's a conflict between an answer and the Program Rules or the Standard Form Electricity Purchase Agreement (EPA), the Rules and Standard Form EPA govern.  

General

How is the Standing Offer Program different from a Call for Tenders (CFT)?

The difference between the Standing Offer Program and previous BC Hydro CFTs is that developers are not competing against each other for an EPA in the Standing Offer Program. Developers who are offered an EPA in the Standing Offer Program will be paid a pre-determined price. Unlike a CFT process, the Standing Offer Program does not create any legal obligations for the parties until a Project EPA has been signed by both BC Hydro and the developer.

When does the Standing Offer Program expire?

There is currently no specified expiry date for the Standing Offer Program.

We are preparing an application for a customer who is currently selling power in short-term increments to Powerex, a wholly-owned subsidiary of BC Hydro. Is Powerex considered to be BC Hydro or a third party?

For the purposes of the Standing Offer Program, Powerex is considered to be "a party other than BC Hydro" and so, in answer to your specific question concerning section 2.4 of the Application Form, an existing or previous electricity purchase agreement with Powerex for electricity generated by the project should be submitted in Exhibit 11, and section 2.4.c of the Application Form is the relevant section in which to respond with respect to the previous or existing contract(s) with Powerex.

What are the costs involved in leasing a revenue meter?

The details of the revenue metering equipment required vary depending on each project's situation.

Lease costs are generally in the range of $100/month per meter. However, some projects may require more than one meter depending on the circumstances. For example, instances where power is being produced behind a load or where the electricity is being transmitted on a private power line (which serves other generators or loads) may require more than one revenue meter for proper measurement. For questions, please contact BC Hydro Revenue Metering.

 

Eligibility

What are the eligibility requirements for the Standing Offer Program?

The eligibility requirements are detailed in Section 2 of the Program Rules.

How can a developer demonstrate site control for a project?

At the time of application, the developer must demonstrate that it has obtained the right to use the site for the project (including all areas where the generating facility and related access roads, transmission lines and other project facilities will be built) for a period generally consistent with the term of the EPA.

For projects on Crown land, a licence of occupation is generally required. Requirements on Crown land may also include leases, right of ways, easements and/or permits under the Land Act (B.C.), Forest Act (B.C.) Transportation Act (B.C.), Federal Real Property and Federal Immovables Act, Canada Marine Act, Indian Act or other provincial or federal legislation requiring land tenure for any aspect of the project.

For projects on private land, Developers should provide a copy of fee simple title, option to purchase, lease or option to lease, joint venture agreement or other contract granting occupancy rights for private land. Interest in property must be registered on title to be considered acceptable evidence of site control.

If additional capacity becomes available, can I apply to the Program again for the same site?

No. As outlined in the Program Rules, two Standing Offer Program contracts cannot be issued for the same site, or for a Common Generation Facility. However, applicants can approach Energy Procurement at BC Hydro to discuss the terms, if any, under which their existing Standing Offer Program EPA may be amended.

Under the Clean Energy Act the definition of "clean or renewable resource" as biomass, biogas, geothermal heat, hydro, solar, ocean, wind or any other prescribed resource is not exhaustive enough and open to interpretation. What is BC Hydro doing about this?

The SOP will only accept clean or renewable energy as defined in the Clean Energy Act. The list of defined resources also includes "any other prescribed resource". If you have a resource that you believe should be prescribed as clean or renewable, please contact the Ministry of Energy to make this request. If you are not sure that a particular technology is included in the clean or renewable definition, you could send us a detailed inquiry through the SOP website.

How will BC Hydro view multiple projects where the combined nameplate capacity of the project cluster exceeds the 15 MW SOP maximum size?

In keeping with our intent to reinforce the original spirit and intent of the SOP (to enable small, standalone clean energy projects in B.C.), projects that have a combined total capacity exceeding 15 MW are not considered small project developments, and therefore aren't eligible for the SOP.

How will BC Hydro determine whether a cluster of projects where the combined nameplate capacity of the cluster exceeds 15 MW will be eligible?

A Project Cluster means two or more existing or proposed Projects that we determine in our discretion are so closely related to each other that they should be considered a project cluster for the purposes of the SOP. We describe the factors we consider when determining a project cluster exists in the Glossary of the SOP rules.

Potential applicants to the SOP may request an optional preliminary assessment of whether the developer and/or the project meet particular eligibility requirements of the SOP. Please refer to section 4.1 of the updated SOP Rules for further information.

For examples of project clusters and SOP eligibility implications, please see: Standing Offer Program: Cluster Configurations [PDF, 32 KB].

If I have an existing EPA with BC Hydro that is about to expire, would this project be able to participate in the SOP?

No. Projects with an existing EPA with BC Hydro that are about to expire are not eligible to proceed in the SOP.  Existing operational projects with expiring EPAs should contact their BC Hydro contract manager.

When can projects with terminated EPAs from previous calls for power submit an application for the SOP?

If BC Hydro signed an EPA for a Project, that Project is eligible for the SOP, provided that it didn't achieve commercial operation while the original EPA was in effect, and the original EPA has been terminated in accordance with its terms and all other post-termination conditions and restrictions in that EPA have been satisfied.

Is BC Hydro retaining all the Environmental Attributes from clean or renewable electricity purchases?

Our current policy is to retain all the Environmental Attributes from clean or renewable purchases, and the value is included in the price paid for the energy.

Certain clean or renewable electricity purchases such as biogas, landfill gas and anaerobic digester projects have upfront greenhouse gas (GHG) emission reductions that are associated with the capture and destruction of methane that is not common to other forms of clean or renewable electricity such as small hydropower or wind. Currently it's an industry practice to separate this GHG emission reduction for use or sale, while still considering the electricity as clean or renewable.

For Projects where GHG emissions can be reduced in the process of methane capture and combustion, we'll allow Developers to retain any rights associated with this upfront GHG reduction.  The Environmental Attributes associated with the generated renewable electricity including any future deemed GHG emission reductions from displaced grid energy, will be transferred to BC Hydro via the EPA.

I'm a BC Hydro customer and I'd like to submit a project to the SOP. Am I still able to participate?

Projects located behind a BC Hydro Customer Load are eligible to apply under the SOP; however BC Hydro will only purchase energy on a Net-of-Load basis.

 

Interconnection

Can I connect my off-grid house to the power line I intend to build for my project?

Possibly, depending on the interconnection circumstances involved.

Who should I contact with my questions about interconnecting my Standing Offer Program project?

Information on obtaining an interconnection for a project is available in the interconnection section of the Standing Offer Program Rules and on the Distribution Generator Interconnections website.

For all inquiries regarding feasibility discussions, interconnection applications, screening processes, preliminary studies and interconnection impact studies, applicants are encouraged to contact BC Hydro Transmission Generator Interconnections or Distribution Generator Interconnections.

What kind of interest is paid on Network Upgrade Security?

We require Standing Offer Program participants to provide Network Upgrade Security in the form of a letter of credit. The required form for the Network Upgrade Security is contained in Appendix 6 to the Standard Form EPA.

These letters of credit are guarantees from a lender that they have the necessary funds to cover the Network Upgrade Security on the developer's behalf. Since no actual funds are received by BC Hydro via the letter of credit, there is no need to pay interest.

Are there any optional interconnection studies I can undertake prior to submitting my application?

Developers of projects that will connect to the Distribution System may choose to undergo an optional interconnection screening study prior to submitting their Standing Offer Program Application. The Screening Study gives a high level technical review of your project, including a preliminary assessment of risks associated with your project and an initial assessment of interconnection costs on the distribution system.

Developers of projects that will connect to the Transmission System may choose to obtain an optional feasibility study which provides a high level assessment of technical requirements and potential interconnection network upgrade costs.

A screening study or feasibility study does not replace the need to conduct the more detailed interconnection System Impact Study required for a Standing Offer Program EPA.

Process

I have a project that's ready to go. How do I apply to the Standing Offer Program?

Developers must submit an Application Form and supporting documentation for their project. See How to Apply.

Is there an application fee for the Program?

There's no application fee for the Standing Offer Program. However, there will be other costs associated with the application process. As part of the process, the developer is responsible for paying the costs of required interconnection studies. Developers should contact Distribution Generator Interconnections group in the early stages of preparing their Application to determine what studies are required and the costs.

Do I have to specify how much energy I'll generate?

Yes, all applicants need to provide us with their project capacity and estimated monthly energy production and related energy calculations.

Can I start my interconnection study before I apply?

We recommend Developers file their System Impact Study application with our Distribution Generator Interconnections group at the time they submit their Application to the SOP. Developers may commence the interconnection System Impact Study process prior to filing a Standing Offer Program Application. However, developers should be aware that depending on the circumstances, we may not accept such an interconnection impact study for purposes of the SOP without further verification or restudy to ensure that the earlier study remains valid and accurate based on current information. The developer is responsible for the costs of obtaining any such verification or restudy.

What is a preliminary assessment? Why is BC Hydro providing this as an option?

We recognize that some developers may require clarity as to whether their unique project meets the SOP eligibility requirements. Developers have also requested that we provide an initial indicative review of certain aspects of their project to help guide them in their decision making. Potential applicants may now request a preliminary assessment of whether the developer and/or the project meet certain eligibility requirements of the SOP. Refer to section 4.1 of the updated SOP Rules for further details.

First Nations Consultation

Where can I obtain information about First Nation consultation requirements?

Developers should contact their local FrontCounter BC office in the Ministry of Forests, Lands and Natural Resource Operations to obtain information on consultation requirements associated with the permits they will require.

When should I be consulting with First Nations?

Developers are encouraged to commence consultation with First Nations as early as possible.

What material should be included in the First Nations consultation record?

A typical First Nations consultation record includes copies of correspondence with First Nations concerning the project, dates of meetings with First Nations, as well as minutes or meeting notes and presentation materials. A typical First Nations consultation record also includes any concerns that First Nations have identified with the project and responses by the developer to those concerns. Similar communications with Crown permitting agencies regarding First Nations issues and concerns should also be included.

Permitting

How can a Developer demonstrate site control for a project?

At the time of Application, the Developer must demonstrate that it has obtained the right to use the site for the Project (including all areas where the generating facility and related access roads, Transmission lines and other Project facilities will be built) for a period generally consistent with the term of the EPA.

For Projects on Crown Land, a licence of occupation is generally required. Requirements on Crown Land may also include leases, right of ways, easements and/or permits under the Land Act (BC), Forest Act (BC) Transportation Act (BC), Federal Real Property and Federal Immovables Act, Canada Marine Act, Indian Act or other provincial or federal legislation requiring land tenure for any aspect of the project.

For Projects on private land, Developers must provide a copy of fee simple title, option to purchase, lease or option to lease, joint venture agreement or other contract granting occupancy rights for private land. Interest in the Project site property must be registered on title before BC Hydro will accept as evidence of site control.

Will permits, zoning and site information be required when submitting the Application Form?

The Program Rules state that documents with respect to a project's permits, site control and zoning must be provided at the time an Application is submitted. Please refer to the Application Form for more details with respect to which documents will be required. Where the project consists of a Completed Prototype Generation Facility, BC Hydro reserves the discretion to identify the permits that are required prior to an offer of an EPA following a review of the project.

Generation Technology

What types of generation technologies are eligible?

New generators using any generation technology that meets the requirements to be considered either Commercial Operation Generation Technology or Completed Prototype Generation Technology are eligible.

How does BC Hydro define Commercial Operation Generation Technology?

Commercial Operation Generation Technology means that the generation technology is readily available in commercial markets and in commercial use (not demonstration use only) as evidenced by at least one generation plant (which need not be owned or operated by the developer) generating energy for a period of not less than one year, to a standard of reliability generally required by Good Utility Practice (as defined in the Standard Form EPA).

Are emerging technology projects eligible for the Standing Offer Program? What is Completed Prototype Generation Technology?

Emerging technologies are eligible if they meet the criteria for Completed Prototype Generation Technology, which means that the generation technology has completed a program of testing, with satisfactory results, using a sub-scale or full-scale prototype of the technology to simulate real-world conditions, which sufficiently demonstrates technical viability and safe performance of the technology at full-scale and under real-world conditions, as evidenced by the certification of a professional engineer (or equivalent engineering designation) registered or licensed in a jurisdiction that regulates the practice of engineering.

How can an applicant complete a Completed Prototype Generation Technology certification?

deally, the professional or licensed engineers involved in the testing and development of the applicant's technology are familiar with the formal metrics-based process of technology readiness assessment and have completed a prototype testing protocol in a simulated or controlled environment. Alternatively, a professional or licensed engineer familiar with technology assessment can be retained to review tests completed to date and provide their professional conclusion as to the validity of the tests and their results.

Pricing

What price of energy will my project be receiving?

BC Hydro will pay for each MWh of energy delivered based on:

  1. the base price as determined by the region of the point of interconnection [PDF, 240 KB] 
  2. any CPI escalation applicable to the base price; and
  3. the time of delivery adjustment factor specified in the EPA.

A sample calculation [PDF, 15 KB] is provided as an example.

Will the price vary based on the generation technology used?

BC Hydro offers all generation technologies the same price, with prices differentiated by the region where the energy is delivered to BC Hydro. The prices to be paid to developers under the Standing Offer Program are detailed in Section 3 of the Program Rules.

Where can I find the current British Columbia CPI?

Monthly reports on the British Columbia CPI can be found on the BC Stats website.

Did BC Hydro consider revising the Standing Offer Program to allow flow-throughs of extraordinary increases in government taxes, rentals and levies? This would enable more developers to get financing to build their projects at the set SOP price since these government change risks are beyond the control of developers.

Yes, flow-throughs were considered as part of the SOP Review process but BC Hydro has decided not to make any associated changes to the SOP Standard Form EPA. The SOP price escalation mechanism described in the Standing Offer Program Rules and Standard Form EPA continues to be viewed as a sufficient means of addressing any potential increases in government taxes, rentals and levies.

The Standing Offer Program pricing is based on the levelized bid prices from the Clean Power Call. The Clean Power Call contract contains no provisions for the flow through of increases in government taxes, rentals and levies, so it is reasonable to assume that the Standing Offer Program sufficiently prices this risk into the contract, making the contract financeable.

Why are you applying a loss adjustment to the SOP pricing for projects where the energy is used in the closest load center rather than the Lower Mainland?

Even if a project actually serves a local load, it would be displacing other energy which would have to travel on BC Hydro's grid to serve load elsewhere in the province. For loss adjustment purposes, the load being served is assumed to be the Lower Mainland.

Project energy losses vary depending on location, types of transmission infrastructure, system load conditions, and other generators in the vicinity. Losses can change over time as these parameters change. For BC Hydro's competitive call processes, individual loss studies considering these parameters are conducted and the loss estimates are used to adjust bid prices.

For the SOP, BC Hydro developed a postage stamp losses price adjustment by region using the loss estimates from the studies conducted in the Clean Power Call. This approach simplifies the pricing, provides applicants with price certainty, and avoids the cost and complexity of individual loss studies for each developer.