Solar Oxford Challenge

Report No: CAO 2017-12 CAO/CLERK Council Date: September 13, 2017

To: Warden and Members of County Council

From: Chief Administrative Officer

. RECOMMENDATIONS

1. That County Council authorize staff to promote and conduct a renewable energy and conservation challenge referred to as the “Solar Oxford Challenge” as outlined in Report No. CAO 2017-12;

2. And further, that County Council authorize staff to offer a financial contribution of up to $500.00 as a performance incentive for up to 16 residents/businesses, representing each of the eight municipalities in Oxford County who participate and meet the eligibility criteria of the “Solar Oxford Challenge”.

REPORT HIGHLIGHTS

. This report seeks Council authority to pilot the Solar Oxford Challenge, a 100% Renewable Energy education and technology demonstration project. . The Solar Oxford Challenge will provide a program that encourages a controlled demonstration of the potential of renewable energy in combination with a culture of conservation. . Customer education and awareness must be based on first-hand knowledge or alternatively, through the actions of others that can be experienced through reporting and physical illustration. . This pilot demonstration will enable a more broadly inclusive participation by other County electricity consumers based on performance results and experiential learning.

Implementation Points

With Council adoption of this report, the Solar Oxford Challenge will be launched by fall 2017, with participant orientation, training and installation work completed by the first quarter 2018.

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Report No: CAO 2017-12 CAO/CLERK Council Date: September 13, 2017

Financial Impact

The Solar Oxford Challenge (SOC) requires full capital cost investment by participants. To encourage conservation and efficiency performance, staff suggest a contribution of up to $500 per participant based on a sliding scale of performance - net zero annual performance will attract full contribution.

Total pilot program costs, excluding staff time, will be limited to $13,000 for the pilot program with contribution costs being limited to $8,000 (16 residents at $500./resident) and communications costs estimated at $5,000. The program was included within the 2017 approved operating budget for Strategic Initiatives as part of the 100% Renewable Energy program.

The Treasurer has reviewed this report and agrees with the financial impact information.

Risks/Implications

Participants in the Solar Oxford Challenge are required to invest in renewable energy technologies and energy conservation measures that when used effectively, will drive electricity consumption to net zero over the course of a full year. Success of the program is largely based on consumer participation and financial investment. Given the intent of the pilot is to assess obstacles to broader residential applications of solar energy and to encourage early adopters to demonstrate the ability to manage home energy demands, risk to the County is limited.

Strategic Plan (2015-2018) County Council adopted the County of Oxford Strategic Plan (2015-2018) at its regular meeting held May 27, 2015. The initiative contained within this report supports the Values and Strategic Directions as set out in the Strategic Plan as it pertains to the following Strategic Directions:

1. i. A County that Works Together – Strengthen, diversify and broaden the economic/prosperity base through: - Strategies to retain and support existing businesses and grow our green economy - Increased collaborative promotion of investment opportunities 3. i. A County that Thinks Ahead and Wisely Shapes the Future – Influence federal and provincial policy with implications for the County by: - Advocating for human and health care services, facilities and resources, support for local industry, etc. - Advocating for federal and provincial initiatives that are appropriate to our county

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Report No: CAO 2017-12 CAO/CLERK Council Date: September 13, 2017

3. iii. A County that Thinks Ahead and Wisely Shapes the Future - Demonstrated commitment to sustainability by: - Ensuring that all significant decisions are informed by assessing all options with regard to the community, economic and environmental implications including: o Potential impacts to the vulnerable population in our community o Responsible environmental leadership and stewardship o Supporting the community implementation of the Community Sustainability Plan

4. i. A County that Informs and Engages - Harness the power of the community through conversation and dialogue by: - Providing multiple opportunities for public participation and a meaningful voice in civic affairs - Fostering greater involvement in County and community events and/or program/project implementation - Understanding and addressing public aspirations for a more livable community

DISCUSSION

Background

By creating a community based challenge that combines conservation and efficiency, smart metering, renewable energy, net metering and/or energy storage, consumers will take ownership of their electricity usage habits with a reward of significant long-term cost and energy savings.

Conservation has become a means to an end, with the result of consumer fatigue and ambivalence. This is creating a barrier to further advancement in energy conservation results. Consumers need a well-defined objective and sense of accomplishment. The Solar Oxford Challenge provides this opportunity through direct participation and direct benefit through action.

Comments

The Solar Oxford Challenge inspires consumers to reduce electricity consumption by up to 50% with the goal of achieving net zero electricity consumption over the course of a year (based on Ontario’s Net Metering regulations).

Ultimately, the Solar Oxford Challenge will create a scalable and repeatable program that will result in a significant reduction in electricity consumption through conservation, efficiency, renewable energy and culture change.

The Solar Oxford Challenge can be considered a gateway to greater and more efficient renewable energy adoption in Ontario. Conservation and efficiency are always the first critical step when considering an investment in renewable energy. Net metering inherently drives this level of efficiency: every watt of electricity a consumer generates from renewable energy that is not required by their home or business is a unit of electricity that can be sent to

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Report No: CAO 2017-12 CAO/CLERK Council Date: September 13, 2017 the electric utility for financial credit. Similarly, the less consumption a consumer has, the smaller the investment required for a solar photovoltaic system. As consumers become more efficient in their use of electricity, they can eventually decide to expand their solar system to carry additional electrical loads (for example, electric mobility).

Program Opportunity and Anticipated Steps

Conservation and efficiency are critical components of sustainable energy harvest and end use, however conservation and efficiency without a clear goal leads to consumer fatigue. In spite of the fact that all Ontarians now have access to their hourly electricity consumption online, current to midnight of the previous day, it is our opinion that the majority of people are not aware of this resource, or do not understand how to interpret the information.

The strength of our Solar Oxford Challenge is based on the following points:

 Establish an educational program that involves Smart metering, conservation & efficiency and renewable energy;  Identify existing annual consumption and calculate required solar to offset annual electricity usage. Estimate total cost of required solar to displace existing annual consumption;  Create an achievable target of reducing electricity consumption by 50% - most consumers can meet this objective with modest effort and minimal cost (and by leveraging existing energy conservation programs);  Re-assess total required solar amount and estimated cost to displace the equivalent electricity consumption after accounting for 50% reduction in annual kwh’s;  Provide education and training resources required to assess best (and possibly most creative) approach to install solar capacity to meet reduced kwh result;  Install solar under one of two scenarios: net metering agreement with local electric utility or energy storage system designed to avoid grid connected export of renewable energy to grid (where grid constraint prevents net metering opportunities);  In the case of net metering, with new solar system in place, work with consumer to help reduce annual kwh by 50% in order to meet net zero electricity consumption over a 12 month period;  In the case of energy storage, with new solar and storage system in place, work with consumer to optimize solar harvest and off-peak charging of energy storage device.

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Report No: CAO 2017-12 CAO/CLERK Council Date: September 13, 2017

Marketing and Promotion – Western MBA report

Oxford County had the opportunity to work with a small group of Western University Executive MBA (IVEY MBA) students as part of their program case study requirements. Their work is a consolidation of thoughts, ideas and recommendations.

Their work suggests Oxford consumers are interested and prepared to invest in renewable energy, but do not know where to start.

The Solar Oxford Challenge will create a critical starting point for customers. The very nature of this program is to develop a starting point for consumers and to further develop a process that can be followed for those interested in renewable energy adoption.

In their summary report Promoting the Oxford County Solar Challenge: Part 1: Case Study (Attachment 1) student authors John Crockett, Daniel Suranyi and Allen Nizi provide a summary of their research and outcomes of a survey they conducted in Oxford County. From their survey they note that 66% of Oxford residents believe individuals should play a significant role in efficiency of electricity use in Ontario, while over 70% indicated they have already taken significant steps toward energy conservation and efficiency measures.

In addition, they found 60% of Oxford residents have considered installing solar panels on their property but lacked information and understanding of the technology, costs and associated savings and therefore did not follow through with an installation.

Ideation Workshop

As part of their work, the IVEY MBA team also lead a workshop with Oxford County staff for the purpose of summarizing survey results and research which led to the following three key success factors:

1. Drive public awareness and participation in the Solar Challenge program 2. Attract community and business leader endorsement 3. Align with other Oxford County initiatives

Finally, in Part 2: Analytical Report (Attachment 2), their recommendations align with current Oxford County and Future Oxford initiatives. Among the recommendations, the authors note that “….the County is likely better served by focussing on deeper engagement with early adopters of solar PV and community stakeholders…”.

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Report No: CAO 2017-12 CAO/CLERK Council Date: September 13, 2017

Participation

 Up to 16 residents/businesses with representation from each of the eight municipalities;  Screening of applicants to ensure demonstrated interest and commitment toward goal of net zero electricity over the course of a 12 month period;  Ability to document experience from beginning to end of pilot and to share story including actions taken and results toward a net zero electricity outcome;  Willingness to invest in the project.

Financial Incentive from Oxford County

 Up to $500 following first year of demonstrated performance to an annual net zero electricity result;  At least one participant representing each of the eight municipalities;  Incentive will be prorated based on performance to net zero electricity over the course of one year;  Capital financing available through partnership with Scotiabank (Attachment 3).

Major Deliverables

 Evidence of consumer engagement resulting from coordination of conservation, renewable energy and net metering/energy storage;  Provide reporting of energy savings, cost savings and innovative outcomes from consumer engagement;  Provide evidence of program scalability and repeatability;  Assess opportunities to expand concept.

Business Case Scenarios, Home Energy Solutions (HES) report

Renewable energy in Ontario is presently in a state of flux. Ontario’s Green Energy Act has done much to advance renewable energy in Ontario to the point that Ontario now leads Canada in the deployment of both solar and wind energy, however the final feed-in-tariff contract program must now give way to a more mature and self-sufficient renewable energy paradigm.

The Green Energy Act provided a relatively stable and secure investment opportunity for Ontario residents, yet it failed somewhat in terms of education and awareness of the very technology itself and arguably, fell short in terms of instilling a culture of conservation during deployment of renewable technologies.

While governments and other stakeholders can create programming and provide investment incentives, much of the heavy lifting (including customer education, assessments and installation) is carried out by private sector professionals.

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Report No: CAO 2017-12 CAO/CLERK Council Date: September 13, 2017

To better understand these challenges and to begin the process of developing a customer education and awareness program, we reached out to a nation-wide solar supplier/installer, Home Energy Solutions (HES).

In their report (Attachment 4) HES outlines the challenges and opportunities facing us as we engage our residents in the development of a culture of renewable energy and conservation awareness.

Included in the HES report are several business case scenarios that address everything from municipal building permit fees and utility connection costs, through to the impact of low and high interest rates. This report is intended to highlight the physical costs associated with solar PV installations as compared to ‘soft-costs’ (permits, education, connection fees, etc), many of which are considered excessive and contribute to higher than necessary final installation costs.

The report from HES is intended to be a starting point – a high level assessment by a professional installation firm to raise awareness of the many costs and fees associated with solar power installations – many of which, if reduced or eliminated, have the potential to accelerate deployment of solar power in Oxford and beyond.

Conclusions

Renewable energy is emerging as a cost effective means of providing net electricity requirements for homeowners and businesses. While many recognize the value of renewable energy and accept the fact that conservation and efficiency can further reduce costs, a common question prevails: How do I get started?

The Solar Oxford Challenge is an opportunity to engage a limited number of consumers toward net zero electricity consumption, with the ultimate goal of enabling all electricity consumers to learn from early participation and eventually supply all of their own electricity requirements from renewable sources of energy.

SIGNATURE

Report Author:

Original signed by

Jay Heaman Manager, Strategic Initiatives

Approved for submission:

Original signed by Peter M. Crockett, P.Eng. Chief Administrative Officer

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Report No: CAO 2017-12 CAO/CLERK Council Date: September 13, 2017

ATTACHMENTS

Attachment No. 1 - Promoting Solar Oxford Challenge – Part 1 Case Study Attachment No. 2 - Promoting Solar Oxford challenge – Part 2 Analytic Report Attachment No. 3 – Scotiabank Loan Program Flyer Attachment No. 4 – Home Energy Solutions Report - Solar Oxford Challenge

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CAO 2017-12 Attachment 1

PROMOTING THE OXFORD COUNTY SOLAR CHALLENGE PART 1: CASE STUDY

John Crockett, Daniel Suranyi, and Allen Nizi wrote this case under the supervision of Professor Derrick Neufeld solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality.

This publication may not be transmitted, photocopied, digitized or otherwise reproduced in any form or by any means without the permission of the copyright holder. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Ivey Business School, Western University, London, Ontario, Canada, N6G 0N1; (t) 519.661.3208; (e) [email protected]; www.iveycases.com.

The boardroom was now empty as Jay Heaman and Peter Crockett reclined in their chairs and reflected on the meeting that had just ended. They had just finished meeting with three Ivey MBA candidates to discuss the desired outcomes for the Oxford County Solar Challenge project. With ideas still running through their head, Heaman and Crockett glanced at the large collection of sticky-notes that had been arranged on the whiteboard. They both knew the Solar Challenge was an opportunity for their community to take a big step forward in their commitment to 100% renewable energy; but needed to find a way to promote the project in a cost-effective way. The activities written down in their ideation workshop activity seemed to glow with flashing lights: A website? A community advisory board? Incentives? Where would they begin?

SUSTAINABLE COMMUNITIES

As the realities of climate change become increasingly apparent, more and more communities are looking to local and regional governments to develop policies and strategic plans that can mitigate or at least manage the impact their communities have on their environment. Over the past decade, initiatives such as expanded waste diversion programs, promotion of reduced resource consumption, and investment in sustainable infrastructure have been an important functions of government activities across Canada. While most, if not all, branches of government have some initiatives in place, a few communities have stood out as leaders in creating sustainable communities.

In Canada, there is a clear segmentation between the roles of the various levels of governments in relation to renewable energy. Federal governments are tasked to create and implement various laws and taxes, which include legislation that regulates the economics of Renewable Energy on a national level. Provincial governments are in control of managing the natural resources within their geographical territories. Finally, the municipal/local government which does not have same level of authority to act and enact laws as the provincial and federal government, but does hold a massive influence in the policy making and implementation process.

Canada’s current Renewable Energy generation initiatives include Hydroelectricity, Solar Power, Wind Power, and Bio-energy. Canada has plentiful solar energy resources, with the most extensive resources Page 2 being found in southern Ontario, Quebec and the Prairies.1 Until recently, the main applications of solar energy technologies in Canada have been for non-electric active solar system applications for space heating, water heating and drying crops and lumber. In 2001, there were more than 12,000 residential solar water heating systems and 300 commercial/ industrial solar hot water systems in use. These systems presently comprise a small fraction of Canada’s energy use, but some government studies suggest they could make up as much as five per cent of the country’s energy needs by the year 2025.2

Next to Canada’s Renewable Energy initiatives, communities on both the municipal and federal level have been focusing on developing innovative infrastructure, paving the way for the effective implementation of sustainable energy on a larger scale. On a federal level, Infrastructure Canada has a current challenge with a significant prize value of $50 million awarded to the best idea a community can come up with, starting in 2017 November. As per the Smart Cities Challenge, the government is looking for proposals using technology and data to improve livability and opportunities for the city and its people, how they interact with the natural environment, and how they create safe and secure public spaces.3

Internationally, there are eight jurisdictions regarded as leaders in their Renewable Energy initiatives. These jurisdictions differ in locations, sizes, population, and political status, but all have a progressive mindset working towards achieving fully sustainable communities operating on 100% Renewable Energy. While some locations, such as Frankfurt, and the Rhein-Hunsrück Region, both located in Germany, have started their initiatives as early as 1990, later adopters such as Denmark and San Francisco are making considerable advancements, making agile adjustments as they go along. The reasons these areas are working towards full Renewable Energy implementation are to mitigate risk and increase resiliency towards geopolitical and climate issues, generate new jobs in a new sector, and of course significant cost savings as a result. There are numerous characteristics all these locations share; political leadership and citizenship involvement is significant, the implementation strategy involves local influencers and the young population, preferred sustainability taxes, and transparency in adopting an integrated approach to fiscal, economic, and energy policy is always evident.4

All eight jurisdictions had barriers in their initial implementations, which they overcame in various ways. In Frankfurt, the city moved gradually with their efforts, engaging stakeholders and communicating results to the wider population thereby generating momentum. In San Francisco, utility and electricity providers are regulated at the State level, so the city introduced green leases, virtual net metering, and community based solar financing schemes that allow individuals to collectively finance larger projects in locations other than their primary residence. In Rhein-Hunsruck, local energy and electricity systems are currently being modernized to increase the efficient use of the excess power generated. In the Fukushima prefecture, where the whole sustainability initiative was introduced after the nuclear crisis in 2011 causing significant out-migration, a shared commitment to reconstruction and revitalization was established early in the rebuilding process. Cape Verde, an island off the coast of Africa, failed to attract foreign investment, so the government partnered with a donor-funded, privately managed infrastructure company to focus on solar power. Denmark’s high taxes and energy costs impact lower income residents, so the country is expanding transmission links with Germany and Sweden to allow for greater imports/exports with Germany and Sweden. Denmark is the only place in the world where next to electricity, their Renewable Energy focus has also been on transportation and heating/cooling, providing them with an advantage and significant cost savings.5

1Centre For Energy “Solar power in Canada” accessed on June 22, 2017 http://www.centreforenergy.com 2 Ibid 3 Infrastructure Canada “Smart Cities Challenge - Get Ready!” accessed on June 30, 2017 http://www.infrastructure.gc.ca/plan/cities-villes-eng.html 4 World Future Council. “How to Achieve 100% Renewable Energy” accessed on June 30, 2017 http://www.medspring.eu/sites/default/files/How-to-achieve-100-percent-renewable-energy.pdf 5 Ibid Page 3

ROLE OF TECHNOLOGY

Technological advancements have of course played a pivotal role in achieving progressively aggressive targets. First, governments have been using social media to effectively communicate with their stakeholders and keep up with their transparent approach. Focused web sites are continuously established guiding the population among the various incentives, resources, and useful links. San Francisco was among the first jurisdictions to introduce virtual net metering, an online based billing mechanism that credits the generators of Renewable Energy for the electricity they add to the local power grid against the electricity they consume; homeowners who place solar panels on their roof can earn credits generated by those panels offsetting the energy they consume. El Hierro, a small Spanish Island’s current strategy is to replace the island’s 4,500 cars with electric vehicles to reduce reliance on imported fuels and further promote sustainability.6

One recurring theme with all markets focusing on sustainability is their focus on modernization and heavy dependence on technological advancements. With the newly revamped, added focus on both transportation and heating/cooling, using technology to enable, communicate, and reduce costs are essential in successful future changes and implementations. As this will ideally become a global initiative, collective collaboration enhanced by ever-evolving information systems will be key in the future.

SOLAR PV TECHNOLOGY

Solar cells, also called photovoltaic (PV) cells by scientists, convert sunlight directly into electricity. PV gets its name from the process of converting light (photons) to electricity (voltage), which is called the PV effect. The PV effect was discovered in 1954, when scientists at Bell Telephone discovered that silicon (an element found in sand) created an electric charge when exposed to sunlight.7 PV systems range from smaller output technologies such as rooftop-mounted or building-integrated systems to significant energy producers such as utility-scale power stations. A rooftop system is the most common among private and commercial properties presently; it recoups the invested energy for its manufacturing and installation within 0.7 to 2 years and produces about ninety-five percent of net clean renewable energy over a 30-year service lifetime.8

OXFORD COUNTY

Oxford County is a regional municipality in Ontario that serves a population of 105,710. Located in the heart of Southwestern Ontario, Oxford County is home to several thriving communities (Exhibit 1). Oxford County is defined by the intersection of unique urban and rural communities. The business centres of Ingersoll, Tillsonburg and Woodstock support an abundance of franchise operations and small businesses, while the surrounding area is rich in natural resources and home to state-of-the-art farming operations because of first-class soils and climate.9

On June 24, 2015, Oxford County Council unanimously passed a motion to achieve 100% renewable energy by 2050, becoming the first municipality in Ontario to commit to such a target. To guide this initiative, they formed Smart Energy Oxford (a coalition of municipalities, sustainable energy businesses, local distribution companies, sustainable energy advocates and private citizens) to pursue and promote the partnerships and opportunities that will help meet this goal.

6 Ibid 7 National Renewable Energy Laboratory “Solar Photovoltaic Technology Basics” accessed June 30, 2017 https://www.nrel.gov/workingwithus/re-photovoltaics.html 8 Fraunhofer Institute for Solar Energy Systems, “Photovoltaics Report” November 2016, accessed on June 30 2017 http://www.ise.fraunhofer.de/en/downloads-englisch/pdf-files-englisch/photovoltaics-report-slides.pdf 9 Oxford County. County Profile http://www.oxfordcounty.ca/Business-in-Oxford/County-Profile Page 4

The Future Oxford Sustainability plan is grounded in the concept that economic and social development must take place within our limited environment (Exhibit 2). It assumes that energy is fundamental to the everyday lives of citizens and business and it stands to reason that the source and application of that energy must likely wise be sustainable and efficient.10 That being said, the existing sources of energy used to power business and homes is largely based on non-renewable forms of energy. To effect change, Oxford County recognizes that they need to connect with the consumer at a grassroots level.

A COMMUNITY READY TO ACT

There has been increased public dialogue around the environment and sustainable initiatives in Oxford County since 2013 when residents expressed concern about a proposed new landfill site.11 Since that time, the dialogue between the County and residents has led to the development of a new Waste Management Strategy12and a commitment to 100% renewable energy by 2050.13 The degree to which the community has been involved in the planning of these new environmental initiatives suggests that the residents of Oxford County are readily engaged in the idea that they can and must make contributions to protect the environment for future generations

A 2016 survey by Environics Research found that Ontario residents were split as to who they believed should play the most significant role in the reduction of energy usage. Half believed “the demand for electricity can be significantly reduced if individuals voluntarily change their behavior” while the other half believed that “Governments will have to introduce new regulations or provide financial incentives to really get people to change their behavior and reduce their energy usage”14 However, the Oxford residents polled in May 2017 leaned more towards the idea that individuals should play a significant role (66% agreed with this statement).15 Perhaps not surprisingly then, three quarters (74%) of Oxford residents indicated that they have made changes to their behavior, by doing things like running appliances to take advantage of off- peak rates or putting lights on a timer. Further, one-third (33%) of residents indicated they had made physical improvements to their home (such as installing new insulation or windows) with the intention of reducing their overall energy consumption.16

The high level of engagement and ownership for environmental stewardship found among the residents of Oxford County indicates that there is a receptive audience for future initiatives that encourage residents to act and impact their own energy footprint.

THE OXFORD SOLAR CHALLENGE

10 Heaman, Jay. Oxford Solar Challenge. Interview via email by John Crockett. April 11, 2017 11 Residents opposed to Oxford County landfill stage “letter dump” CTV Kitchener. Published October 25, 2013. Accessed June 15 2017. http://kitchener.ctvnews.ca/residents-opposed-to-oxford-county-landfill-stage-letter-dump-1.1513186

12Chessell, B. Ocford County council votes to amend official plan regarding waste management. Woodstock Sentinel Review. Published June 9 2016. Accessed June 15 2017 http://www.woodstocksentinelreview.com/2016/06/09/oxford-county-council-votes-to-amend-official-plan- regarding-waste-management 13Oxford County commits to 100% renewable energy by 2050. Accessed June 17 2017 http://www.oxfordcounty.ca/Home/Newsroom/News-Details/ArticleId/4395/Oxford-County-commits-to-100- renewable-energy-by-2050 14Environics Research. Canadian Environmental Barometer. June 2016 15 Oxford County Community Energy Survey. May 2017 16 Ibid Page 5

Oxford County plans to embark on a demonstration project in 2017 to illustrate opportunities to engage the community in efforts to adopt more sustainable energy behaviours. The County has developed a program called the Oxford Solar Challenge which will encourage residents to cut their energy use by up to 50% over a year and then to satisfy their remaining energy needs by installing solar PV panels on their homes.17 Oxford County has kicked off this initiative by partnering with local banks to offer special lending rates for green home improvements18; however, there is a need to develop a promotional strategy for the Oxford Solar Challenge that can drive awareness of the initiative as well as the benefits for reduced energy consumption and green home renovations.

According to Peter Crockett, Chief Administrative Officer of Oxford County:

“Oxford County is leading the work to advance the role of net metering and virtual net-metering because of our commitment to 100% renewable energy by 2050, and because we are a prime example of the potential value local energy conservation and renewable energy generation can provide to a community, it's residents and businesses.

The Oxford Solar Challenge is envisioned as a mechanism to further engage our community in energy conservation and renewable energy outcomes. Our vision of a community actively conserving energy while optimizing their property, building and renewable energy investment resources will be a model for ensuring a community has access to the energy residents and businesses need at an affordable and sustainable cost.”

At the outset of this project, Oxford County earmarked $20,000 to promote the program. They had concluded the program should be rolled out in late August to capitalize on citizen engagement opportunities during the busy fall fair season. However, with their limited budget, it was even more important they execute the most effective promotion strategy that would drive awareness and participation in the Oxford Solar Challenge. A high level of active engagement with the community was important to creating an impactful demonstration project that could be shared with partners and provincial governments to secure funding for future projects.

SOLAR PV & NET METERING IN ONTARIO

Net metering is a billing mechanism that credits the generators of renewable energy for the electricity they add to the local power grid against the electricity they consume. To date, net metering programs have been focused on individual customers or small-scale operations at a single site; however, recent regulatory changes now permit larger customers to right-size their renewable energy system to their load.

Rooftop systems are the most common among private and commercial properties presently; it recoups the invested energy for its manufacturing and installation within 0.7 to 2 years and produces about ninety-five percent of net clean renewable energy over a 30-year service lifetime. In Ontario, net metering has been present for a few years; the users’ electrical meter is replaced with a new meter that can run forward and backward. All electricity produced by a solar system is first used by the owner of the system. If there is a surplus, it runs onto the electrical grid and the electrical meter runs backwards. While Residential solar systems are typically sized to cover less than half of the total electrical needs of a household, it is possible

17 Foreman, G. Ontario’s Oxford County a renewable energy pioneer. David Suzuki Foundation. Published August 22, 2017. Accessed June 17 2017. http://www.davidsuzuki.org/blogs/climate-blog/2016/08/ontarios-oxford-county- a-renewable-energy-pioneer/

18Lending support for sustainable home improvements. Accessed June 17 2017 http://www.oxfordcounty.ca/Home/Newsroom/News-Details/ArticleId/7600/Lending-support-for-sustainable-home- improvements-1 Page 6 to get a credit for the extra electricity generated based on one’s usage.19

For off-grid applications, PV systems are often cost-effective as they are competing against fuel-powered generators or power line extensions, which typically cost $5,000 to $10,000 per kilometer. However, for grid-connected PV systems, it is difficult to justify the installation of PV systems purely based on current economics, given the current relatively low cost of grid electricity in most areas of Canada. However, some people are starting to treat PV systems like any other house upgrade. Instead of deciding whether it is cost- effective at the time of purchase, they are deciding whether they can afford it and considering their future needs along with the associated benefits of reducing one’s overall environmental impact. The current cost of PV systems ranges from $8,000 to $10,000 per installed kilowatt, including all system components. To help accelerate the uptake of PV systems and drive down costs, some provinces and utilities are considering various incentive measures. One such measure is a feed-in-tariff (FIT), where a renewable energy generator is offered a premium for electricity produced, for a set term.20

PROMOTING THE OXFORD SOLAR CHALLENGE

Feedback from residents via the Speak Up. Oxford! virtual town hall identified that three in five residents (60%) had considered installing solar panels on their property to generate renewable energy for their home.21 Qualitatively, reducing their environmental impact was a key motivator for these individuals as the desire to reduce their reliance on centralized power and reduce their home energy costs. However, while the audience who participated in the virtual town hall exercise represented an engaged group, many indicated that they had not gone through with a Solar PV installation because of either the high perceived costs of the activity or because they felt they lacked sufficient information/understanding of the grant/Micro-Fit applications.22 Therefore, any attempt to drive awareness and participation in the Solar Challenge would need to address these key pain points.

PROMOTIONAL ACTIVITIES:

An ideation workshop with Oxford County, led by the three students in the Ivey Executive MBA program, identified three key success factors for the Solar Challenge:

1. Drive public awareness and participation in the Solar Challenge program 2. Attract community and business leader endorsement 3. Align (in terms of presentation and messaging) with other Oxford County initiatives

All three of the above themes could be categorized under awareness, information and education.

Based on input from the workshop, three promotional activities were considered to support the Oxford Solar Challenge.

1) Traditional Media Campaign - A combination of press releases, newspaper/radio advertisements or advertorials aimed at driving awareness of the program among Oxford County residents. Oxford County has a communications team that is currently tasked with these kinds of activities for a range of County initiatives. Oxford County is served by four media outlets including the Oxford Sentinel

19 Ontario Solar Farms. Residential Solar PV Systems Accessed on June 30 2017 http://www.ontariosolarfarms.com/residential.html 20 Canadian Mortgage and Housing Corporation. Photovoltaic (PV) Systems Accessed on June 30 2017 https://www.cmhc-schl.gc.ca/en/co/grho/grho_009.cfm 21 Oxford County Community Energy Survey. May 2017 22 Ibid Page 7

Review (newspaper) and three radio stations.

2) UpfortheChallenge.com - The creation of a microsite that can serve as the promotional centerpiece for the Solar Challenge. This site would serve as a hub for information and education about the use solar PV in Oxford County. The site would also contain a few interactive elements such as a mini-game that would allow users to track their energy consumption and interactions with social channels such as Facebook, Instagram and Twitter to foster engagement and participation in the program. The microsite could be built off the existing http://www.oxfordcounty.ca/ website infrastructure, but it is estimated that it would cost about $10,000 in development costs to upgrade the site design and implement some of the key interactive elements.

3) Establish a Community Liaison Panel - The creation of a board of residents and local business owners who can provide input on County efforts to grow the adoption of solar PV. The board would be asked for input on information materials and incentives and asked to provide support in attracting corporate partners for the project. Oxford County currently manages an online town hall called Speak Up, Oxford! that is used to solicit citizen input on a range of activities. From time to time the County posts content on the town hall platform and asks for resident input via surveys or email comments. This town hall platform generates significant interest from the community and could be leveraged to recruit members for the Community Liaison Panel.

DECISION TIME

There was a knock on the boardroom door at Oxford County Municipal building where Heaman and Crockett had both still been contemplating the many possibilities of what the Solar Challenge could be. Fifteen minutes had passed since the Ivey team had left the meeting and coming into the room now was Chloe, Mr. Crockett’s executive assistant, advising him that his next meeting was about to begin. Gathering their items, it was clear that the two Oxford County executives were still reflecting on the last two-hour discussion about the road ahead to becoming a leader in renewable energy. What moves would need to be made at the leadership level to successfully implement Net Metering county wide and secure full adoption and support from Oxford residents? The County and its leadership had publicly stated its intentions to be a leader not only among the local surrounding regions but to be provincial or even a national or international example of renewable energy use. Other cities around the world had been successful but were they different? Did Oxford County have the right tools to make this happen? Were the citizens up for the challenge? Crockett and Heaman knew from the initial research conducted by the Ivey team that general awareness of the County’s net metering initiative was low and needed to vastly improve on all fronts for any chance of achieving their goals. Their highest priority task at hand, how to best promote the upcoming Oxford County Solar Challenge. Page 8

EXHIBIT 1: OXFORD COUNTY MUNICIPAL BOUNDARIES

Source: Wikipedia, Oxford County, Ontario https://en.wikipedia.org/wiki/Oxford_County,_Ontario

EXHIBIT 2: SUSTAINABILITY FRAMEWORK

Source: Future Oxford Sustainability Plan http://www.futureoxford.ca/General/SustainabilityPlan/index.htm Page 9

EXHIBIT 3: SURVEY RESULTS

Source: SpeakUp! Oxford Town Hall Survey (n=133) Environics Canadian Environmental Barometer (n=776) Page 10

EXHIBIT 4: IDEATION WORKSHOP WITH COUNTY STAFF

On Monday May 29th, the Ivey MBA team organized an executive meeting at Oxford County City Hall where we led an idea workshop with the leadership team who will be spearheading the Solar Challenge. Our workshop asked all participants to list out ten features of the Oxford Solar Challenge Promotion that they deemed to be a priority. Upon the initial listing exercise, the participants were then asked to prioritize the ten must-haves into priority from 1-10. The bottom four were then discarded and the participants were then asked to map their remaining ideas on a two by two quadrant labelled as Complex to Less Complex (on an X- Axis) and Impact to Less Impact (Y-Axis). The purpose of this activity was to learn from the Oxford team what they deemed as most important but also help them understand what paths they should pursue first for the most impact and least amount of complexity.

Photos of the output from the workshop. The question was “What are the key success criteria for promotion of Oxford Solar Challenge?” Page 11

EXHIBIT 5: SPEAK, UP OXFORD! VIRTUAL TOWN HALL

To better understand the perceptions of renewable energy solutions and consumer pain-points, we leveraged Oxford County’s virtual town hall, Speak Up, Oxford! From May 3 to May 12, 2017 we invited residents to participate in a 5-minute survey. The survey measured awareness of solar PV, net metering, and asked for input as to how residents thought Oxford County should promote the Solar Challenge. While the survey was an opportunity to gather feedback from n=130 residents, it was executed using a convenience sample and it not considered to be representative of the population of Oxford County. Participation in the survey was promoted on the Oxford County website, social media accounts and featured in the local media. To encourage participation in the survey, participants were entered a draw for a $100 gift card to a local restaurant.

Source: http://www.oxfordcounty.ca/Your-Government/Speak-up-Oxford/Campaign-Details/ArticleId/7498/Energy- Consumption-at-h CAO 2017-12 Attachment 2

PROMOTING THE OXFORD COUNTY SOLAR CHALLENGE: PART 2: ANALYTICAL REPORT

SUMMARY

Oxford County seeks to build on the enthusiasm of residents towards sustainable energy consumption. To this end, Oxford County should focus its promotional activities for the Oxford Solar on the development of a microsite that can educate and connect interested residents with the information and services they need. Further, they should continue to engage residents to inform the evolution of the Solar Challenge and other SmartEnergyOxford programs through the creation of Community Liaison Panel the will ensure that their efforts to become a more sustainable community continue to be community-driven.

PROBLEM IDENTIFICATION

Oxford County plans to embark on a demonstration project in 2017 to illustrate opportunities to engage the community in efforts to adopt more sustainable energy behaviours. At the outset of this project, Oxford County earmarked $20,000 to promote the Oxford Solar Challenge project and seek input on the most effective way to increased public awareness about solar PV while also driving increased community and business leader engagement with the program.

EVALUATION CRITERIA

An ideation workshop with Oxford County, led by three students in the Ivey Executive MBA program identified three key success factors for the Solar Challenge:

The ideal solution(s) will address the following criteria:

Criteria Explanation Measurement Page 2

Potential exposures An effective promotional activity will Reach maximize the number of citizens exposed Opportunity to initiate meaningful to the program engagement

Strategy has features/elements that allow for opportunity to educate or Engagement and participation in the Solar inform. Address Consumer Pain- challenge will result if promotional Points activity alleviates pain-points w/ solar PV Activity provides flexibility to address a range of consumer-centric issues

Long-term success for solar PV will be Demonstrates potential to generate Is Community-Driven more sustainable if “pull” strategies community input and ownership of generate market demand program

Required Resources Promotional budget of $20,000 needs to be Capital costs associated with the managed responsibly and generate the activity. most bang for the buck. Resources/effort required to implement and sustain the activity.

ALTERNATIVES

Option 1: Traditional Media Campaign

The first option available to Oxford County is to leverage the various media outlets available to them (newspapers/online, location radio stations, and OxfordCounty.ca to generate awareness for the Oxford Solar Challenge. A combination of press releases, newspaper/radio advertisements or advertorials could be used to drive attention to the Challenge and make citizens aware of the funding alternatives and incentives being made available.

Reach Traditional media activities likely represents one of the most effective ways for Oxford County to reach residents. Whether residents get their news in print, online or over the radio, local media efforts can do an effective job of getting the word out about a new campaign. Additionally, a traditional media campaign would be suitable to deliver focused message around the importance of renewable energy. However, while a media campaign might be the best approach for raising awareness, activities like press releases and advertisements or advertorials present a limited opportunity to present citizens with in-depth information. Much of the feedback from the Speak Up, Oxford! survey indicated that residents are quite familiar with solar PV and the County’s efforts to engage the community on the topic of renewable energy. Therefore, while the opportunity to for exposure for the Oxford Solar Challenge may be high, the opportunity to initiate meaningful engagement about the topic (e.g. discussion of key pain-points) is probably insufficient.

Addressing Pain-Points Traditional media activities likely represents a limited opportunity to alleviate pain-points of potential solar PV users. While an advertorial may be able to tout the benefits of reduced energy consumption and provide basic information on pay back periods for installing solar panels on one’s property, many of the residents we spoke to suggested that they have very specific questions (often unique to their own property) that they Page 3 sought answers to. The “static” nature of a traditional media campaign would not provide the sufficient depth or flexibility for interested citizens to find answers to their questions without also involving some other kind of promotional activity.

Community-Driven Traditional media activities offer some opportunity to generate “pull” demand for the Oxford Challenge by driving awareness. While not-necessarily directly correlated, it would follow that effectively generating awareness of an issue that resonates with the public would create demand for the outcomes and incentives of the Oxford Solar Challenge. However, the demand that this activity would generate would not be all that different from the demand for sustainable initiatives that already exists within the community. More realistically, this kind of promotional activity should be a “push” activity which would be more appropriate for driving residents to seek out more information about solar PV instead of an activity that seeks to educate.

Required Resources Oxford County has an in-house communications team that produces web content and press releases for many communications activities. The utilization of in-house expertise would ensure that the positioning and implementation of the communications are consistent with other Oxford County initiatives. The capital residents about public consultations and other activities and has a well-established website to disseminate news. To really drive awareness Oxford County might consider some paid advertising in out-of-home advertising like radio or billboards; however, these activities are not likely to offer opportunities to communicate the depth of information consumers are looking for and thus likely represent wasted efforts.

Option 2: Solar Challenge Microsite

Oxford County could create a microsite to support the Solar Challenge which would engage and educate the public about the benefits of solar PV and provide information about making an investment in solar PV for their own property. The site could also contain a few interactive elements such as a mini-game that would allow users to track their energy consumption and interactions with social channels such as Facebook, Instagram and Twitter to foster engagement and participation in the program.

Reach A microsite would be dependent on other activities to drive reach. In and of itself, the only reach the microsite would generate would be the organic search traffic that it generates (e.g. people who are searching for information on solar PV would end up on the site). However, Oxford County would be able to generate reach for the microsite by promoting the microsite on their existing website and social media. Visitors to the site would represent meaningful engagement. In these cases, it is the consumer who must take the initiative to seek out the information, but this also means they have a high degree of interest in the topic and would represent meaningful engagement with the program. Additionally, Oxford County could leverage social media, either through promotion on their Facebook/Twitter pages or by seeding conversations with blogs and influencers to drive attention to the Solar Challenge. Similarly, identifying and engaging with bloggers who focus on local or sustainability issues can be an effective way to promote the Solar Challenge microsite at a grassroots level.

Addressing Pain-Points A microsite dedicated to the Oxford Solar Challenge would represent an excellent opportunity to educate consumers about renewable energy and alleviate the pain-points associated with solar PV. Residents identified a lack of understanding about investment and paybacks as the chief barrier to solar PV and therefore would benefit from an activity that allows them to explore their options in more detail. The microsite could include tools and mini-games that provide users with an opportunity to see how solar PV impacts their individual needs. Interactive calculators could be used to demonstrate payback period, size of equipment required while more lighter activities could quiz users on tips to reduce their energy consumption. The microsite also presents a unique opportunity to connect consumers with the business that Page 4 can source and install solar PV equipment. The County could use the site to promote corporate partners and vetted service providers which would make the Solar Challenge more attractive to third-party sponsorship/support. Oxford County should look to innovative web designs such as WealthSimple.ca (which won the 2017 Webby award for Best Financial Services website1) that can serve as examples of how to share complex information to consumers in interactive and compelling ways.

Community-Driven The microsite is community driven in that it would be a direct response to some of the needs and pain- points voiced in the Speak Up, Oxford! energy survey. However, it could also incorporate elements of community involvement by acting as a conduit to further discussions about renewable energy and solar PV in the Oxford Community. The microsite could include a forum/message board function where those interested in the topic can ask questions and discuss with other like-minded individuals or could even provide a conduit into existing Facebook groups. The microsite could allow participants in the program to post the results of their efforts to reduce energy consumption by logging information from utility bills or to provide feedback to the County on their experience working with program partners. In many respects, the microsite has the potential to evolve with the needs and interests of those interested and participating in the program.

Required Resources Designing and deploying an interactive website would be the most resource-intensive activity among the proposed options. The development for a new site with the features and function described above could cost more than $20,000. However, building on the existing OxfordCounty.ca web infrastructure and content management system and developing a priority list of features could likely be completed for about half as much. Oxford County would likely need the support of external web programmers to develop some of the proposed features but could utilize in-house resources for ongoing management and maintenance.

Option 3: Community Liaison Panel (CLP)

The creation of a board of residents and local business owners who can provide input on County efforts to grow the adoption of solar PV. The panel would be asked for input on information materials and incentives and asked to provide support in attracting corporate partners for the project.

Reach The CLP would not, at least initially, drive broad awareness of the Solar Challenge. Overtime, the members of the CLP would engage with other residents and stakeholders and awareness would grow organically, but this activity would not drive reach to the same degree of the other activities. That being said, the awareness that is created (either among CLP itself or their networks) would result in meaningful engagement with the Solar Challenge. It would give those on the CLP an intimate opportunity to connect with program staff and other like-minded individuals. This rich engagement would likely lead to a high degree of participation in the program by members who ultimately can serve as examples for others in the community.

Addressing Pain-Points The main objective of the CLP would make significant contributions to the County’s understanding of consumer pain-points and the development of financing, incentive and partnership programs that would be tailored to the unique needs of Oxford County residents. The CLP would provide Oxford County with a committed group of residents who can give meaningful feedback on County initiatives. Their input could contribute the positioning of program communications to ensure that they resonate with residents. Another objective of the CLP would be to drive closer collaboration between residents, corporate partners and businesses providing solar PV products and installation. The CLP gives Oxford County an opportunity to

1http://www.webbyawards.com/winners/2017/websites/general-website/financial-servicesbanking/wealthsimple- website/ Page 5 cultivate relationships between these groups which will directly impact the adoption rate of solar PV in the future. The more these stakeholder groups have an opportunity to collaborate at this early stage the more likely: ● vendors will be to develop offerings that meet the needs of homeowners, ● corporate partners will be to recognize the value of sponsoring programs like the Oxford Solar Challenge, and ● residents will feel their voice is being heard.

Community-Driven Another important objective of the CLP is that it underscores to residents the significance of their role in protecting their local environment. The high degree of engagement among CLP members would ensure that the related activities and outcomes are deemed relevant by the broader community. More than just a token gesture though, the CLP will bring considerable credibility to the Solar Challenge program and future efforts to engage the community on initiatives to drive the adoption of solar PV initiatives.

Required Resources The CLP has very few capital costs associated with it; however, the recruitment and coordination of the panel would take a significant amount of time. Local politicians, and the networks of County staff could be tapped to nominate or recruit members of the panel, but at least half of the seats should come from an open call for volunteers. Regular meetings will require staff coordination and participation as well as meeting facilities; however, County staff are already well experienced with these kinds of activities.

IMPLEMENTATION

Recommendation

Choosing the appropriate promotion activities for the Oxford Solar Challenge is dependent on the desired outcomes. While, on one hand, Oxford County would benefit from increased awareness of its programming, the County is likely better served by focusing on deeper engagement with early adopters of solar PV and community stakeholders. Therefore optimum promotion strategy for the Oxford Solar Challenge would combine a microsite that generates meaningful engagement with residents while also establishing a community liaison panel to drive the ongoing evolution of this program as well as other SmartEnergyOxford programs.

Page 6

Workplan

Activity - Timing Level of Effort Capital Community Liaison Panel Costs

Post a call for CLP applications 1-2 days to draft application N/A on Oxford County website and in criteria local newspaper

Select 6-8 CLP members from 4 - 6 weeks 2-3 days to review applicants N/A applicant pool and 4-6 members 7 days to interview shortlist from key staff/stakeholder contacts

Schedule 1st bi-monthly meeting 1-2 days to prepare agenda N/A with CLP

Activity - Timing Level of Effort Capital Microsite Costs

Meet with webmaster to identify 1 day - initial meeting N/A opportunities & barriers for 1 day - follow-up discussion microsite

Post RFP for required web design 2 weeks for RFP scoping N/A support 1 week to evaluate and select winning bid

Crowdsource energy min-game 1 week to connect with computer $1000 in

(concurrent with RFP process) science faculty at local academic prize for

institutions winning entry 16-20 weeks 1 week to develop “specification” for min-game (e.g. platform, data inputs, etc.).

4 weeks for student design

1 week to select winning application

Page 7

Design and implement microsite 2 weeks Develop wire frames for $15,000 to microsite $17,000 2 weeks Program first pass of code 2 weeks Review feedback from stakeholders 2 weeks finalize content for site 2 weeks to implement changes 2 weeks to Pilot test Launch

Promote microsite on social 2 days to develop marketing copy $500 media and Oxford website promoted ad spend on Facebook

Risk/Contingencies

The main risk associated with the proposed activities is that the development of the microsite expands beyond the original scope and budget. To carefully manage costs, Oxford County should establish a clear set of specifications at the outset of the project so that content and development efforts address the key pain-points expressed by residents interested in solar PV. Oxford County should seek a web development partner who can build a flexible web infrastructure and who will utilize an agile development process to get a basic microsite to market quickly, while leaving the door open for expansion of content as the program matures.

The Community Liaison Panel could run the risk of becoming political if guidelines are not put in place with respect to the rules of order, length of term served on the panel, and the availability of incentives to panel members. To this end Oxford County is encouraged to recruit and manage the CLP in a transparent fashion and ensure that any solar PV financing and incentives offered to CLP members are equally available to all residents.

CAO 2017-12 Attachment 3

Want help with an energy-efficient reno?

If you’re thinking about making In support of the Future Oxford Community Sustainability Plan†, Scotiabank is pleased to offer the following special rates to help you energy-efficient home with your green home improvements: improvements – like adding • ScotiaLine® Personal Line of Credit: prime +1.00% for six months.* insulation, getting a high efficiency • Scotia Plan® Personal Loan: 6% Fixed or Prime +3.30% variable for a five-year term** (up to $35,000 unsecured; higher limits available furnace, or window replacement – dependent on security) we’re offering special rates on a Make your home a little greener. Call us or come in and talk personal loan or line of credit to to a Scotiabank Advisor today.

help make it happen. 385 Springbank Avenue N. 485 Dundas Street 199 Broadway Street, Woodstock, ON N4T 1R3 Woodstock, ON N4S 1C3 Tillsonburg, ON N4G 3P9 Tel: 519-537-2900 Tel: 519-537-3473 Tel: 519-688-6400

® Registered trademarks of the Bank of Nova Scotia. † In partnership with Oxford County. For details visit FutureOxford.ca All Credit applications are subject to credit approval and meeting the Bank’s standard documentation requirements. * The introductory interest rate of Prime + 1.00% takes effect when the account is opened and will then continue for six months from that date. After the promotional period, the rate for your balances that were at Prime + 1.00% will increase to the regular interest rate that applies to your ScotiaLine Personal Line of Credit account (“Account”) of Scotiabank Prime plus an adjustment factor of up to 8.9% (the adjustment factor will be disclosed to you after credit adjudication for the Account and prior to your Account acceptance). Offer applies to new personal Accounts only (business and student Accounts are not eligible for this offer). Existing ScotiaLine Personal Line of Credit customers are not eligible for this offer. The minimum monthly payment will be the interest charge amount, or $50, whichever is greater. You can pay off the entire balance without penalty. There is no interest-free grace period on a ScotiaLine of Credit account. Scotiabank Prime is the prime lending rate of The Bank of Nova Scotia and is subject to change without notice. We may also change the adjustment factor, but we will give you prior written notice of this with the effective date change. Scotiabank Prime is 2.70% as of July 16, 2015. No annual fee, subject to change. For current rates and information on fees and interest, call 1-888-882-8958. ** The fixed rate stated above is based on a term of five years only and may be higher for a different term or subsequent term. “Prime” is Scotiabank Prime which is the prime lending rate of The Bank of Nova Scotia and is subject to change without notice. We may also change the adjustment factor, but we will give you prior written notice of this. Scotiabank Prime is 2.70% as of July 16, 2015. Should you visit a branch and apply for this loan, then, among other things: (i) We may obtain a credit bureau report concerning you in connection with this loan; (ii)during the term of the loan, you may not withdraw your consent to our ongoing collection, use or disclosure of your personal information in connection with the loan; and (iii) we can continue to disclose your personal information to credit bureaus even after the loan has been retired, and you may not withdraw your consent to our doing so, all of which we do to help maintain the accuracy, completeness and integrity of the credit reporting system. This offer is only available to those who have reached the age of majority in the province in which they reside and excludes existing Scotia Plan Personal Loan customers. Offer applies to new personal accounts only (business and student accounts are not eligible for this offer). You will need to agree to abide by the Agreements which govern the Scotia Plan Personal Loan, including the Scotiabank Privacy Agreement, copies of which will be provided to you at the time of application and in the meantime can also be obtained at any Scotiabank branch. No annual fee, subject to change. For current rates and information on fees and interest, call 1-888-882-8958. CAO 2017-12 Attachment 4

Solar Oxford Challenge

Summary Solar Oxford Challenge (SOC) would look at reducing the current barriers to PV installations within the region in order to advance the installation of PV Net Metered systems as a method of conservation. In order to create a scalable and repeatable program that will result in a significant reduction in electricity consumption, four main areas of improvement have been identified:, consumer education, building permits, utility interconnection and system financing.

Introduction

Oxford County has committed to only using 100% renewable energy by 2050 and was the first community in Ontario to do so. The Solar Oxford Challenge inspires consumers to reduce electricity consumption by up to 50% through the installation of a PV system, with the goal of eventually achieving net zero electricity consumption over the course of a year (based on Ontario’s Net Metering and additional conservation). Ultimately, the Solar Oxford Challenge will create a scalable and repeatable program that will result in a significant reduction in electricity consumption through renewable energy, conservation, efficiency and culture change.

In spite of the fact that all Ontarians now have access to their hourly electricity consumption online, it is our opinion that the majority of people are not likely using it to set conservation goals. With the addition of a PV system on the Net Metering program, consumers start to monitor their consumption more closely in order to achieve a net export. Once they start to monitor, they start to set goals, reduce usage and implement other energy conservation methods. Every month they try to use less and less power so that they can maximize their generation credits. There are many easy ways to achieve this and conserve energy; from adjusting your thermostat a couple of degrees cooler or warmer depending on the season, to turning off any electronics when not in use, lights bulbs can be changed to more efficient LEDs, and old appliances can be replaced with newer, more efficient models. This strategic initiative would advance Oxford toward the goal of employing 100% renewable energy by demonstrating PV installations as an initial step to conservation. A typical Oxford County home was analyzed to determine the average cost on small scale, net-metered, installations. For this report a sample home was sized for 4.8kW of PV using micro inverters. Installing a small net-metered PV system like this would offset approximately 50% of an average home's annual electricity usage, with the goal to target the other 50% through simple conservation methods. This will enable the participants to achieve net zero electricity consumption.

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The table below shows the installed cost of a 4.8kW PV system as it would be if installed today (WORST CASE) and what that same system would cost if the Solar Oxford Challenge is successful (BEST CASE). The average installation is currently costing ($17,482.36) $3.64/w versus the potential with barriers reduced is ($11,976.06) $2.50/w.

These cost reductions can be easily achieved with minor adjustments and investment by the county; all while drastically improving PV deployment. These four main areas are: customer education, utility interconnection, building permits and financing, are discussed in detail along with the recommendations to improve implementation. These reductions can also be coupled with financing options to make the PV installation available to those without the upfront capitol to implement a system.

A simple method to increase motivation and begin the implementation of the cost reductions above would be to provide a $1 500 incentive to each homeowner to implement a pilot PV system. By subsidizing a small amount of the pilot cost, interest in the project will grow, as more people will have the capital to employ the project. As a result of increased applicability, more consumers will be educated on the project, which in turn reduces the cost of consumer education in the established program. Further guidance on the subject will also aid the dismissal of unnecessary fees such as building permits and engineering costs, as more people learn why they are impractical when putting in place a simple PV system. Overall, the cash incentive decreases costs by the incentive amount ($1 500) in the pilot system, and cuts costs even further in the established system, resulting in an increasing ROI and decreasing the number of payback years.

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The table below demonstrates the impact on the capitol cost and ROI of the pilot incentive. This will make the investment attractive enough for consumers to invest in the pilot.

Through the installation of multiple successful pilot systems, the experience gained can be used to educate other customers and stakeholders, an important step to a successful established program. Documenting the process of installing the initial systems will also allow for the streamlining of subsequent installs and create repeatable program that will result in a significant reduction in electricity consumption. It will also help to gain evidence of consumer engagement resulting from coordination of conservation, renewable energy and net metering. Provide reporting of energy savings, cost savings and innovative outcomes from consumer engagement will prove the programs scalability and repeatability.

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Methodology

In order to analyze the business case for each opportunity, we had to pick an example site. The site selected was used to approximate the installed cost of a PV system. The estimation was assessed using the most frequently used equipment and installation methods in the industry. This means the equipment may not be the lowest costing on the market, but is the most common. The system consisted of 16 PV solar modules rated at 300w each for a total of 4800w. The modules are connected through micro inverters, which convert and blend the solar electricity into the home's system. See the electrical diagram for details.

The system was assumed to be connected to a sloped south facing roof with asphalt shingles. This is common for most solar installations, however the cost would only very slightly for other roof types. See the mounting drawing for details.

The system energy savings were calculated using a software program called PVSYST. This is a frequently used tool for the analysis of PV system production, as there are a number of factors that affect each systems performance throughout the year. The main factors are: location (sunlight available), shading, temperature and orientation. See the PVSYST document for details.

About HES PV

HES PV is a Canadian PV system consultant, designer and equipment supplier, which has been in the Canadian solar industry for over 25 years. Our experience includes numerous grid-tie, micro-grid, off-grid, and net metered projects for the industrial, residential and commercial sectors. Our office locations are in Barrie, Toronto, Montreal, Victoria, and Edmonton, with the team of experts who will help ensure success of this program. HES’s team has the personnel with experience in all aspects of the solar project cycle and dealing with authorities in every province and the territories. We understand the uniqueness of the Canadian environment and all the variables that will produce the best return on investment and customer satisfaction.

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1. Education and Reduction in Costs

Currently, as part of the sales process, installers have to educate the homeowner on how solar works, the net metering program, installation procedures, billing and many more topics. The installers build the expense of educating customers into their profit margin and represent a significant cost reduction for installed systems. Education is also the key factor in public acceptance and adoption, therefore making it one of the first places you should start. It’s simple, has little expenditure, brings down barriers and builds familiarity in your community. Awareness spreads the word on solar, and is one of the best ways of advertising the positive steps a region takes to better the environment. Who should be educated? Municipal workers, utility personnel, inspectors, planners, as well as the homeowners. We found that most communities focus on just teaching the homeowners and miss out of involving everyone associated in the implementation of the system. An example would be the person that processes the building permit packages, if they are more knowledgeable on PV systems, they may be able to process the applications quicker. What specifically should they have an understanding of? How solar works, can you feed solar energy back to the grid, what is net metering, how should solar be installed, how to select an installer, etc. A lot of this can be accomplished through the municipal web site with references to existing site that already have some of these answers. The following are a few of the education materials that should be made available.  Solar PV fact sheet  FAQ (Frequently Asked Questions)  How to select an installer

Building a library of materials is the first step, following that you would need to get them out into the community. Information sessions held at municipal halls have been very successful. It is a great opportunity to bring all the stakeholders together and present useful materials. We have found that installers are quite willing to offer their time to these events to answer the questions.

The pilot program would allow the county to build education materials based on actual installations and demonstrate the results. System overviews, case studies, power savings and processes can all be mapped out through the pilot and will aid new customers when adopting solar. There would also be the potential to show live monitoring of the pilot systems on the web site as part of the education materials.

The table below show the potential savings in system cost from the current situation where the installer has to educate the customer as part of the sales process and the impact if the customer is pre-educated before getting a system installed.

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The average margin installers are currently charging is approximately 30%. We estimate that this can be cut in half. The difference in time commitments for an installer to educate the homeowner easily covers the difference in profit. An installer can also assume an increase in volume of sales with highly educated residents. The difference would be spending weeks to educate one homeowner versus several homeowners requesting very specific quotes.

With a few simple steps to educate the stakeholders, savings on installed cost of almost 15 percent, a payback period of 15 years and an improved ROI of 6.07% would be the result.

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2. Building Permits& Engineering Costs

Building permits and engineering approvals are an absolute necessity for any structural modification, whether it is residential, commercial, or industrial. They are there for a reason – to prevent anyone from making dangerous and potentially fatal modifications to structures, as well as providing a uniform method of structure modification. However, flush mount residential solar installations do not require any structural modification. These systems have a proven track record in the world market for safety and therefore should be exempt from the expensive and time-consuming building permit process. Many municipalities are leading the way in this realm, with Toronto, Calgary, San Jose, San Diego, Palo Alto, and Portland already implementing “no permit and engineering costs” for specific residential situations. These regions are a great example of how members of a municipality can come together to create a reasonable policy to benefit homeowners and future generations, which is the end result of the Solar Oxford Challenge.

In Oxford County; East-Zorra-Tavistock, Ingersoll, South-West Oxford, and Zorra all have specific building permit fees and what is required for obtaining a building permit for solar installations. However, the fee and the requirements vary greatly between the municipalities. For the other municipalities; Blandford-Blenhiem, Norwich, Tillsonburg, and Woodstock, there are no specific permitting processes for solar, as a result they lump solar in alongside other existing permit processes with little thought of the impact or benefit. Again, the fees and requirements can fluctuate drastically. These general building permit fees are typically based on the project price. The Building Permit forms vary from one page for Ingersoll, to filling out four pages for Blandford-Blenhiem. Most of these applications must be accompanied by stamped engineering drawings, assurance forms and field reviews, which continues to add unnecessary costs and time delays. Interruptions such as these, caused by the permitting process, are frustrating to both the contractor and the homeowner.

The pilot systems will help to document the building permit processes and demonstrate to building departments how simple these systems can be. The pilot systems would be used to streamline the process, removing unnecessary engineering fees and address any concerns through the proof of concept method.

The table below shows the impact on the installation costs and ROI of a system if the building permit process is improved and the fees reduced.

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Simple systems end up taking months not weeks. In the worst-case example above, the cost for the building permit and engineering fees is $2,140, which is 20% of the cost of the system! All of these fees can put system expenses at an unreasonable level. As a result, they can add 2 years of payback to the system, all while being easily avoided.

Electrical Permits are still required for any electrical work in Ontario. The total cost for an electrical permit on a solar system that is less than 10kW is $290.

The municipality should employ a simplified building permit process for particular systems, such as flush mount lightweight racking on existing residential rooftops. If the permit, drawings, and fees were eliminated for these systems, the result would be greatly simplifying the process and reduce the costs of installing a solar system, and making the implementation of a system more attractive to the end user.

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3. Utility Interconnection

Solar is viewed as a generation facility instead of load displacement by the Utility. As a result of this some utilities require expensive, extraneous equipment that does not necessarily improve the safety of the system and only adds complexity to it. This is unnecessary as all modern grid-tie inverters have their own built-in protection circuits that shut the system down in the event of a power outage or fault and stop producing power. A properly installed solar system is very safe, provided proper installation procedures and CSA approved equipment are used.

Oxford County has three different LDCs (Local Distribution Company); Hydro One, Tillsonburg Hydro, and Erie Thames Powerlines. The application process, forms, and fees are diverse between the different LDCs. Tillsonburg Hydro has the same application process and forms as Hydro One, but they must be submitted to Tillsonburg Hydro. Erie Thames has entirely its own forms and connection methods. There is also a $180 price difference in the interconnection fee between Erie Thames and Hydro One.

Some utilities require stamped electrical engineering drawings along with their application forms, which can add considerable expense and time delays. Utility companies also take a considerable amount of time to review the forms before approval. What should be a simple application process can take months. Additionally, all Ontario LDCs charge an interconnection fee to connect generation equipment to the grid and feed in power. This interconnection fee in Oxford County ranges from $620-$800, an additional 6 or 8% of the cost of the system.

These interconnection fees are based on the old MicroFit style systems, with a separate meter, and a fused disconnect. With one of those systems, the grid would have to be shut off in that section in order to make the connection to the grid. A more modern Net Metering system connects through a breaker installed in the main electrical panel of the dwelling. There is no separate meter and no separate connection point with a Net Metering system. Therefore there should be a decrease in Interconnection fees as a reflection of its low-profile implementation.

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Also, the application process should be improved from complex forms, often exceeding six pages, to a shortened, one-page application form and simplified connection method for small systems that do not requiring additional equipment outside of the existing code requirements. Interconnection fees should be defined by system complexity, size, and connection method, not a standard fee to cover a large amount of varying systems. There is a lot more involved with installing a 100kw FIT system when compared to a simple net-metered system that is less that 10kW. What can be done to fix this and reduce costs? One-page application, no fee, no engineered drawings and no additional protection equipment for residential systems under 10kw. BC Hydro is leading the way with a simplified process for small residential systems with no connection fee and a single-paged application form.

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4. Financing PV Systems

The upfront cost of a solar installation can be a daunting prospect for many new solar customers. This can deter some homeowners from proceeding with the project, thus decreasing the deployment of systems within the region. Some financial institutions offer energy retrofit loans that include solar, but several of these tend to be high interest or short term. The ideal loan for a PV installation would be using an interest rate in the range of 2-3% and a term greater than 15 years. The most successful practice, balancing practicality with availability, has been through a property-assessed loan or a mortgage extension. This is the most favourable method, but can be difficult to implement. A PV system loan can turn a large, sometimes unmanageable upfront cost into a series of small, much more manageable monthly payments. Even with a loan interest, a solar installation still provides a very attractive return on investment and significant savings on your hydro bill. The example 4.8kw net metering system costs worst case is ($17,482.36) or best case ($11,976.06). The example below shows the impact of using the Scotiabank energy retrofit loan values. The system is financed at 6% fixed or Prime+3.3% variable for a five-year term, with prime rates at 2.95%, the 6% is a better value. This turns the initial investment into a monthly payment of $381.99 or $261.68 respectively. The effect of the loan should be measured by how close your monthly payments come to your Hydro savings. Your old average hydro bill was $64.40, the net difference for this loan being approximately $320 or $200 per month.

The end goal would be to supply a loan with a rate and term that came close to the savings generated by the system.

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The next example below shows the loan rate and term that would make sense for the homeowner. The system would be financed at 2% interest and a 15-year term. The net difference for this loan would be reduced to approximately $60 or $20 per month.

The net difference decreases as your hydro rates increase each year, eventually reaching the point where your savings are greater than your payments. This type of loan can escalate the level of adoption mainly by turning a capital investment into small, manageable monthly payments. When also compared to the savings, the solution becomes a 'No Brainer'.

The goal for this business case would be for the municipality to seek out loan opportunities for a 15-year loan at 2%.

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Conclusion To improve solar PV deployment in the region, four main areas for improvement have been identified: System Financing - Create opportunities for a 15-year loan at 2%.. Such a financing program could reduce the barrier of up front capital while aligning loan payments with utility savings. Education - Creating web based education materials and facilitating educational sessions to raise the level of understanding to all stakeholders. This diminishes the cost of systems by removing the task of the installer educating each homeowner, and shows the region endorses this method of conservation. Building Permits - Streamline the building permit process by exempting 'simple' systems from requiring a permit. This decreases both costs and lead-time to deployment. Utility interconnection - Reduce interconnection fees and processes as part of the transition from MicroFIT to Net Metering. This would allow simple, small systems to be viable and moderate expenses as well as implementation time.

Through the implementation of pilot systems, the experience gained can be used to educate other customers and stakeholders. Documenting the installation process of the initial systems will also allow for the streamlining of subsequent installs and create repeatable program that will result in a significant reduction in electricity consumption. It will also help to gain evidence of consumer engagement resulting from coordination of conservation, renewable energy and net metering. Providing reporting of energy savings, cost savings and innovative outcomes from consumer engagement will prove the programs scalability and repeatability. By managing the four main areas of improvement, the implementation of the pilot systems as an attractive substitute for energy will ultimately increase the success of the entire program.

Appendices 1. Sample SLD 2. Sample Layout 3. PV System Production Simulation 4. Hydro One Rate Explanations 5. Net Metering Brochure 6. Welcome Letter 7. Scotiabank loan 8. Oxford County Interconnection and Permits

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