August 2008

General Questions and Answers

Q1: Why is Natural Resources Canada (NRCan) amending the Terms and Conditions of the ecoENERGY for Renewable Power (ecoENERGY RP) program at this time?

A1: After one year of operation of the program, NRCan is making some adjustments to improve the administration and delivery of the program and to respond to a number of concerns raised by stakeholders.

Q2: What are the main changes to the New Terms and Conditions?

A2: One of the key changes is that the trigger for the federal environmental assessment process will no longer be the registration of a project, i.e., Notice of Project Application. The new trigger will be when funding for the project is committed - that is when a Contribution Agreement (CA) is signed between NRCan and the project proponent. Although a CA is signed, it will not be possible to claim the incentive unless a positive environmental assessment decision is rendered.

Original Process	New Process
Step 1: Notice of Project Application Step 2: Environmental Assessment Step 3: Technical Project Information Contribution Agreement Signed Step 4: Notice of Start of Construction Step 5: Commissioning of a Project	Step 1: Notice of Project Application Step 2: Technical Project Information Contribution Agreement Signed Step 3: Environmental Assessment Step 4: Notice of Start of Construction Step 5: Commissioning of a Project

Other changes include, among others:

• Defining biomass boilers as eligible generating equipment;
• Allowing the eligibility for replacement of existing capacity based on normal operating service life;
• A stacking provision was introduced for projects receiving funds from other levels of government. The stacking limit is set at 75 percent of a project's capital costs.
• The creation of a waiting list of projects in the event that all available funding is fully committed;
• Requesting information about Aboriginal groups that may be impacted by the project; and
• New requirements for a Costing Report.

Q3: When will these new Terms and Conditions be applicable?

A3: The new terms and conditions will come into effect September 3^rd, 2008.

Specific Questions and Answers on the new Terms and Conditions

Q4: What will happen to projects that are already in the process of conducting a federal environmental assessment?

A4: The new application process applies to all projects. NRCan will cease to be a Responsible Authority on the environmental assessment for projects that cannot meet the requirements of the Technical Project Information application and sign a Contribution Agreement within three months. Projects that can meet this requirement will receive priority in the review of their environmental assessments.

NRCan will resume the review of the project's environmental assessment once the requirements of the Technical Project Information are met and a Contribution Agreement is signed.

Q5: I am not ready to construct but I want to start my environmental assessment as early as possible. What should I do?

A5: Proponents can use guidance provided by the Canadian Environmental Assessment Agency (the Agency) available on its website, to prepare their Environmental Impact Statement. In addition, proponents should contact the Regional offices of the Agency for more information regarding the applicability of the Canadian Environmental Assessment Act and other federal environmental assessment (EA)-related questions.

Guidance specific to wind farms is also available from NRCan (ecoENERGY RP) upon request. NRCan is currently working on developing additional EA guidance for other renewable power technologies.

Q6: When can I send my Technical Project Information documents?

A6: When the project is registered under the program (Notice of Project Application is accepted) and when the project is within eight (8) months of start of construction AND when the project is expected to be commissioned within twenty (20) months, see section called The Approval Process under the new terms and conditions.

Q7: Why do you require proponents to identify Aboriginal groups at the time of the Notice of Project Application?

A7: NRCan may have a duty to consult Aboriginal groups on the potential funding of a project where it has knowledge of an existing or potentially existing Aboriginal or treaty right that may be negatively impacted by the project. NRCan wants to engage interested Aboriginal groups as early as possible in the project planning and approval process, and during the environmental assessment process.

Q8: I will be receiving financial support from the provincial government for my project. Can I receive the incentive under the ecoENERGY RP program?

A8: Yes provided the total amount of funding from all government sources, inclusive of the program incentive does not exceed 75% of capital costs and the project meets all other eligibility criteria of the program.

Q9: I will be changing the boiler on my thermal plant so that it can use low-impact biomass resource. Does it qualify for the program?

A9: Yes, the electricity produced by the electric generator powered by the new boiler will be eligible for the incentive provided that all other eligibility criteria of the program are met.

Q10: I will be replacing an existing hydro project that has been in operation for 60 years. Will the full new generation from a new plant qualify for the program?

A10: Yes, because the old facility is past its normal operating service life, the new plant will be treated as a new facility.

Q11: What happens when NRCan has committed all of its funding to projects that have Technical Project Information applications in review? Will it continue to review more applications?

A11: When all ecoENERGY RP funds have been committed, the program will time and date stamp all new Technical Project Information applications and put them on a waiting list. The program will evaluate these projects only when a project with a contribution agreement can no longer fulfill the requirements of the approval process; and corresponding funds are released.

Q12: By triggering the federal environmental assessment later in the program's approval process, is there a danger that projects will be constructed and commissioned before a decision is rendered on the environmental assessment?

A12: By changing the approval process, NRCan will be able to dedicate resources specifically for projects that have a high degree of certainty that they will be constructed and commissioned. These projects will receive priority and timelines for rendering decisions should improve. Another advantage is that NRCan, other federal departments/agencies and proponents will not be allocating resources unnecessarily for projects that may not receive federal funding.

Q13: Can you please clarify the requirements for section A14 of the Technical Project Information application?

A13: The project proponent is required to provide proof that the project has received the required provincial/territorial permits and authorizations. This includes proof of municipal and/or district approvals by local authorities. If a provincial/territorial environmental assessment (EA) is required for a project and has been completed, documentation demonstrating its completion must be provided. If the provincial/territorial EA is not yet completed, the Environmental Impact Statement (EIS) for the project prepared to support a harmonized EA process must be submitted. Proponents may obtain guidance from ecoENERGY for Renewable Power EA officers or the Canadian Environmental Assessment Agency regarding federal EA requirements when preparing their EIS.