microFIT Rights and Responsibilities
The microFIT Program was introduced in Ontario on October 1, 2009, to provide homeowners and other Eligible Participants with the opportunity to develop a “micro” renewable electricity generation project (10 kW or less) on their property in order to become “Suppliers”. As this program stopped accepting new microFIT applications as of December 1, 2017, the information provided below is only intended to provide existing Suppliers and assignees with helpful information and resources about their rights and responsibilities under the microFIT Program.
A microFIT Contract is a commercial agreement entered into between the Independent Electricity System Operator (IESO) and a Supplier for a term of 20 years. It provides a guaranteed price to Suppliers for electricity produced and delivered to the province’s electricity grid over the Contract term.
A Supplier may opt to retain a third-party service provider to assist in administering their microFIT Contract, however, it must be noted that:
- The Supplier is responsible and accountable for the rights and obligations agreed to under the microFIT Contract with the IESO;
- The Supplier remains liable to the IESO for all representations, warranties, obligations, covenants, and liabilities under the microFIT contract;
- A third-party service provider is not permitted to accept, amend, assign or terminate a microFIT Contract on a Supplier’s behalf;
- The Supplier must access their microFIT Contract through the IESO’s Beacon Portal (as described below) using their confidential password and log-in credentials. Suppliers must keep their password and log-in credentials strictly confidential and not share it with other parties, including a third party service provider;
- Any agreement with a third-party service provider is a separate commercial contract and is generally not considered a “consumer transaction”. This means that participants are unlikely to be covered by consumer protection legislation in their dealings with third-party service providers;
- The IESO is not a party to any third-party service agreement that the Supplier enters into and the IESO will not address or mitigate any issues or disputes between a Supplier and its third-party service provider, and
- Where a third-party service provider is a member of, or employed by a member of the Canadian Renewable Energy Association (CanREA), complaints or concerns about the third-party service provider may be sent to CanREA at email@example.com. Please refer to the CanREA Member Code of Conduct website for further information.
Suppliers are encouraged to obtain their own independent legal, business or technical advice related to their rights and obligations under the microFIT Contract. Suppliers are solely responsible for the accountabilities and obligations agreed to under their microFIT Contract. Suppliers are also responsible for all other requirements associated with their project that exist outside of the microFIT Contract, including income tax, property tax, insurance coverage and others.
Please note that the IESO cannot provide advice to Suppliers and the information below should not be interpreted as advice, legal, or otherwise.
Beacon is an online tool that the IESO introduced in 2019 to enable Suppliers to manage their active microFIT Contracts. Beacon is owned and operated by the IESO for the purpose of administering the microFIT Program.
Suppliers are solely responsible for the activity that occurs on their Beacon account and must keep their account password confidential and secure. Suppliers must not allow anyone else to access their Beacon account, or do anything else that might jeopardize the security of the account. By accessing Beacon, Suppliers agree to use commercially reasonable efforts to prevent unauthorized access to or use of Beacon through their account, and will notify the IESO immediately of any such unauthorized access or use.
Managing a microFIT Contract
All aspects of managing a microFIT Contract, including the assignment process, are conducted through Beacon. It is important for a Supplier to keep official contact information up-to-date at all times. The IESO will communicate with a Supplier exclusively through their primary email address or, if unavailable, the mailing address found within the microFIT Contract. As such, Suppliers should:
- Regularly ensure that their contact information is correct and current;
- Update their email address as listed within the microFIT Contract by contacting the IESO at microFIT.firstname.lastname@example.org;
- Update their mailing address as listed within the microFIT Contract by submitting a Change Request via Beacon, and
- Keep Beacon login credentials (e.g., username, password and answer to the challenge questions) confidential and secure.
Selling a property with a microFIT Facility
microFIT Contracts do not automatically transfer to the new owner with the sale of a property. To successfully transfer a microFIT Contract from one Supplier to the next, the microFIT Contract must be assigned from the current Supplier (the “Assignor” or seller of the property) to the prospective Supplier (the “Assignee” or buyer of the property). Suppliers should note that:
- The IESO does not charge a fee to assign a microFIT Contract, although there may be a fee to set up a Generator Account with some Local Distribution Companies;
- The assignment process must be conducted online through Beacon;
- The assignment process requires the cooperation and participation of both the Assignor and Assignee;
- The IESO does not mitigate disputes between Assignors and Assignees, and
- More information may be found at microFIT Contract Assignments.
Under the microFIT Program, Suppliers are paid a guaranteed rate for the electricity they produce in the form of Generation Payments. Generation Payments are issued by the Local Distribution Company which services the area in which the microFIT Facility is located. Suppliers can find their LDC by simply inputting their postal code into the locator tool.
Generation Payments may be considered revenue by the Canada Revenue Agency (CRA). Even if a Supplier is working with a third-party service provider, they are still responsible for all impacts to their income taxes. As such, Suppliers should note that:
- The IESO encourages Suppliers for the microFIT Program to contact an accountant or tax specialist with knowledge of renewable energy projects to address any questions about the potential tax implications of a microFIT Contract.
- Suppliers may wish to refer to the Canada Revenue Agency (CRA) website for additional information. Please refer to the CRA web page with information regarding potential tax implications, and
- Suppliers may also wish to refer to the Municipal Property Assessment Corporation (MPAC) website. Please refer to the MPAC web page for information regarding the potential impacts of solar panels on property taxes.
It is important for Suppliers to check with their insurance company to determine whether additional insurance coverage is required for their home or microFIT Facility. As a homeowner, a Supplier will likely be required to obtain additional insurance coverage. Therefore, Suppliers should consider taking the following steps:
- Update their home or business insurance policy to ensure it covers the microFIT project;
- Ensure that their home or business insurance policy provides proper protection, even if a third-party service provider provides insurance for the microFIT Facility, and
- Refer to the Insurance Bureau of Canada's (IBC) microFIT Program web page for insurance tips from the IBC.
Service and Maintenance
microFIT Suppliers are responsible for the equipment, installation, operation and maintenance of their microFIT Facility. The IESO is not associated or affiliated with any vendors, contractors, manufacturers, installers or third-party service providers in respect of the microFIT Program. The IESO does not endorse or recommend any of these types of third-parties and does not maintain any approved list or recommendations. Suppliers are solely responsible to conduct their own due diligence in retaining any service provider or other third party for any purpose.
Electrical Safety Authority (ESA)
Any renewable energy project can be potentially dangerous, creating the possibility of electrocution and fire hazards. It is important for Suppliers to take appropriate steps to ensure their project is safely installed on their property, noting as follows:
- All project installations require an inspection from the Electrical Safety Authority (ESA) before they can be connected to the electricity grid. The ESA may be contacted at 1-877-372-7233 or by visiting the ESA website.
- Before performing any work on their microFIT Facility, including disconnecting the solar panels to do roof repairs, a Supplier should contact their Local Distribution Company, and
- Suppliers should ensure that all electrical work required for their microFIT Facility is performed by a licensed electrical contractor and if required, obtain an ESA Connection Authorization and/or an ESA Certificate of Inspection.
Please refer to the microFIT program documents page for program-related documents, such as the microFIT Rules and microFIT Contract.
For microFIT Contract-related questions, please contact: microFIT.Contract@ieso.ca.
For microFIT Program-related information, please visit: www.ieso.ca/microfit.
Further information can be found at: microFIT Program: Addressing Marketplace Issues (presentation), and microFIT Program FAQs.