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Solar FAQs

Frequently Asked Questions


Table of Contents

Solar Opportunities in Ontario

Our Company - Solar Direct Canada

Solar Panels on Your Roof (or on your lawn)
The Power
Income

Your Location

Financing

The Green

The Rules


Solar Opportunities in Ontario

I would like to install solar, what are my options?
In Ontario there are four different ways you can use solar.

MicroFIT - This is a program offered by the Ontario government where if you put solar panels on your roof they will guarantee to buy as much power as you produce for the next 20 years at a set rate. The 20 year rate for people who lock in this year is 31.1 for systems under 6kW and 28.8 cents a kWh for systems between 6kW and 10kW. This has been the most popular program for the past 7 years.

Net Metering - This is the simplest program to understand. You generate the power and you use it. Excess power can be stored in the grid for up to 12 months.

Off-Grid - This type of system is used when there is no grid connection available. This is typically used for remote sites.

Grid-interactive Net Zero - This is a hybrid of net-metering and off-grid. It is typically used when the utility will not allow a standard grid-tie system.

How do I know which option is best for me?
The best way is to call us and talk to one of our solar specialists. We can quickly determine what the best option is for you. Here are some general guidelines though;

MicroFIT - If you do not have a load account at the site this is the only choice. This option has the highest initial rate of return but overall the rate of return is lower than net-metering.

Net-metering - This is the most popular program this year. This option will give you a lower initial return on investment but over the life of the system it will give you a much higher ROI than any other option. Net-metering is much faster to get approved and much less restrictive than MicroFIT

Grid-interactive Net Zero - This option is used when you have a grid connection but the utililty will not let you connect a solar system to it. It is more expensive than net-metering or microFIT but it has the added bonus that you will have power when the grid is down.

Off-grid - This is only suitable if there is no grid connection available. It is the most expensive option.

Who is eligible to participate in the microFIT program and who is not?
Over the years this has become more restrictive. The property that the project is going to be installed must be owned by an individual not a corporation, with some exceptions. The exceptions are, registered farmers, hospitals, utilities, municipalities, schools, churches, social housing and aboriginal groups. In almost all cases you cannot install a ground mounted system under MicroFIT Reference the IESO document here for all the minute detail.

Why would I go with net-metering if microFIT is available?
First of all, the overall return on investment is higher with net-metering even though the inital rate is lower. Second of all there are less rules around net-metering. We can install net-metering panels on the ground where we usually can't with microFIT. We can also oversize the DC which means we can install 15kW or more of solar panels whereas under microFIT we are limited to 10kW.

Can I have both a microFIT and a net-metering on the same property?
Yes.

How can a net-metering system have a higher return on investment than a microFIT when the feed in rate is higher than I am currently paying for hydro?
The first reason is that the microFIT program has a set price for the next 20 years of 29.4 cents per kWh whereas the price we pay for hydro goes up each year, and it goes up a lot. On average we have seen 10% plus increases in the price of hydro each year. In a few short years we will likely be paying more than 29 cents for hydro anyway. The second reason is that we can build larger systems under net-metering which have better economies of scale.

Can I convert my microFIT system to a net-metering system in the future?
Yes and we believe this is going to happen with the majority of microFIT systems under the current rate. Once hydro rates exceed the microFIT rate than there would be no reason not to do this.

How much would it cost to convert a microFIT to a net-metering system? Is the equipment compatible?
The equipment for a microFIT system is exactly the same as it is for net-metering systems. The only difference is how it is connected to the grid. The cost to convert will depend on the utility and the ESA. It could be as low as $500 or as high as $3,000. Our best estimate would be about $1,500 but don't hold us to that.

Under net-metering rules do I get credit for the higher time of use rate?
Yes, but it isn't that simple. They will credit you at the higer rate unless they take you off time-of-use billing which most utilities will. Most people will benefit from lower bills by this change alone. Also, you won't have to wait until midnight anymore to start the dryer.

I'm sick and tired of my utility and just want to cut the cord. Can you help me?
With the high electricty rates and the lack of customer service from the utilities we get this call alot. The answer is, Yes we can but you probably don't really want to do that. We all want to be independant of the monopolistic utilities but it does come at a price. From a return on investment standpoint the net-metering option is much better. You still get to generate all of your own power but you don't need to worry about batteries and generators.

When does off-grid make sense?
Off-grid makes sense if you don't currently have a connection to the grid. Bringing in a new service can be expensive, especially in cottage country or any rural areas. We have seen prices of $70,000 to $200,000 to install new services. In this case it makes a lot of sense. We can build a real nice off-grid system for less than those numbers.


Our Company - Solar Direct Canada

How long have you been in business?
We have been in business since March 1990 so we have been in business for 26 years. We haven't done solar for that long, only the past 10 years.

Where are you located?
Our shop and office is located in Acton, Ontario.

Where do you install?
We like to operate locally but we do installations across the province, from Tobermory, to Windsor, to Ottawa, to Sault Saint Marie. We will install anywhere. We have supplied equipment and exptertise for projects across North America.

Who does your installs?
Our own team of installers does all of our installs. Unlike some solar brokers we do not subcontract out any of our installations, this way we have better control over the quality and timing of our installs.

Who does your electrical work? Are they ESA certified?
Most of our installs are done by B&T Electric. They are ESA certified master electricians and have connected hundred solar projects to date..

What does your price cover? Is it really a turnkey price?
Everything and yes. You will not incure any costs over and above what is agreed upon on your purchase order.

Who owns your business? Is it a Canadian-owned business?
Solar Direct Canada is owned by Ray Jarvis and Michael Jeffrey, both of Acton, Ontario. And, indeed, we are Canadians.

How many installs have you done under the MicroFIT program?
As of 2016, we have installed more than 300 projects.

Do you install systems that aren't under the MicroFIT program? ie: battery backup or net-metering?
Yes. Most of our installations are grid-tie but we do offer off-grid systems and hybrid grid-interactive systems.

Can you provide references?
Of course. In fact, if any solar power company cannot provide you a list of 20 or 30 customer references that you can pick from, stay clear.

What's different about your systems?
I will answer this question up front: We are not the cheapest system on the market. We can't be. It seems many of our competitors are willing to cut corners to provide the cheapest system they can install. And we know, from fixing competitor systems, exactly what those corners are. If you don't mind a leaky roof, if you don't mind poor efficiency (and less revenue), if you don't mind lack of warranty, then you're fine with competitor systems. Go spend less money and be content. As for us, we install a premium system. Period. If you want a KIA, go buy a KIA. If you want a BMW, come to us. I don't know how else to state this.


Solar Panels on Your Roof (or on your lawn)

Will my roof handle the weight of these solar panels?
Very likely. The weight of the solar panels and mounting system adds less than 3 pounds per square foot, which is pretty low when you think about it. It would be like adding another layer of shingles. If your roof is still standing after the ice storms of the past winters than you roof will be fine with solar panels.

How are the panels attached. Will they damage the roof?
This is a great question and one that more people need to ask when considering a solar installation. It is a critical part of your system but since it is out of site under the panels, few people give much thought to it. A full size system can mean up to 90 roof penetrations and it is imperitive that every one of them be leak free for the life of your system.

An inexpensive system like butyl tape which can be seen in this video does not meet the requirements of the building code, will invalidate your roof warranty and will eventually leak. At the other end of the scale is the PV Quickmount system. It is probably the most expensive mounting system out there but it is also the best. It is all aluminium and stainless steel and even though it costs $1,500 more than the cheaper ones, we feel it is money well spent. We are in business for the long term and we simply cannot afford the risk of a leak in your roof.

What if my shingles aren't in very good shape?
Get them replaced first. Remember that these systems must stay on your roof for 20 years. If we have to pull them off so that you can replace your shingles, it will be at your expense. If you can't afford to re-do your entire roof right now, then see if you can just do the area where the panels will sit.

How much roof space do I need?
About 80 sq feet per kW. Installing systems smaller than 4kW is probably not worth your hassle. If you're trying to do the math yourself, then figure each panel as 66" x 40". We mainly install in portrait mode, but occasionally in landscape if we're bolting into purlins horizontal roof members rather than trusses.

My roof has a lot of fancy peaks and strange angles. Is that a problem?
It certainly makes our job more challenging but we can usually find a layout that will work with most rooftops. A small older home often has more room for panels than a newer larger one does.

Can I put panels on two sides of my roof?
Absolutely, in fact we can show you installations where we have panels on four sides or even more. Depending on the slope, a roof plane facing due West or due East will only lose 13% power over one that is facing due South. In some cases we can even utilize rooftops that are facing NW or NE. In some situations an East/West can yeild more output than a South facing roof.

My roof is pointing directly West (90º off South), will it still work?
Yes, see question above. A typical roof that faces directly West or directly East will still earn up to 87% as much as the same roof pointed directly South. Your Return on Investment could still be better than 9%.

What about shade?
Too much shading is bad. This can be from trees, but often from chimneys. It can seriously affect your income. Our technicians have specialized tools to perform a shading analysis to determine if shading will be a problem for your site. (Note that a 10kW system is equivallent to planting 15 acres of trees!)

How does snow affect the panels?
If the panels are covered with snow, their output will be affected. Fortunately most of our sun hours occur during the summer so losing January is not going to have a big impact on your annual production. Also, the panels are usually mounted at an angle so usually the snow will slide off. If you have a low roof it may be practical to clear the snow with a roof rake but it isn't strictly necessary.

Will birds or squirrels be a problem?
Squirrels have been a problem in the past. New ESA rules require us to install metal squirrel guards on all of our installations so this is no longer a problem. Do you account for wind?
Yes, it's a design consideration.

What if my neighbours are jealous?
They probably will be. Sorry, we can't help with that.

Will hail damage the solar panels?
The glass used in solar panels is tempered, so it's very strong, about the same strength as your car windshield. Unless you regularly get hail stones as large as baseballs, you have nothing to worry about. So far, after installing tens of thousands of panels we have never seen a single panel damaged by hail.

How long does the equipment last?
Manufacturer warranties for solar panels are typically 25 years. Inverters are warrantied for 10 to 20 years with another 5 or 10 years optional. From what we have seen from installations in Europe and California, solar panels should actually last about 40 years.

How much does insurance cost?
We are pleased to report that finally after 20,000+ installations in Ontario, most insurance companies now understand solar. Most of them now treat solar equipment the same as any other equipment such as a hot tub or upgraded kitchen. Our customers pay from $75 to $150 extra per year.

Check with your insurance company. In the past some of our customers have had to change insurance companies to get reasonable rates but most insurance companies are now on board.

How long will the installation take?
It depends on the size of installation, the complexity of your roof, and any other factors around your home. However, you can figure approximately 2 to 3 days for the panel install and another day for the electricians.

I have a second home, can I put solar panels on both of them?
Yes, but if you are planning to use the microFIT program, different properties must be owned by different individuals to qualify. For example, if a husband owned one home and his partner owned the other home, then each could apply separately for the property under their name. If either of the properties is owned jointly than only one property can be enrolled in the microFIT program. Under net-metering rules there is no limit.

What is the maximum amount of electricity I can sell to the government?
There is no real limit on the total kWh's that they will buy but you can only supply 10kW at any one time.

So I can only install a maximum of 10kW in solar panels under MicroFIT?
Under the microFIT rules you cannot exceed 10kW of panels or inverter capacity. Under net-metering rules we can install more than 10kW of panels. Many net-metering projects have 15kW of panels or more.

Why do you use 3 dual-axis solar trackers rather than one big one?
There certainly is equipment on the market that could allow us to mount 10kW on one big tracking array. The main problem with this is height. These larger units are designed for utility scale installations, not homes and farms. We have to conform to a height restriction of under 5 meters in most locations. The engineering and installation of one large array can often be a lot more complicated (and expensive) then three smaller ones and it is less likely to annoy neighbors and zoning officials.


The Power

Will my house be powered by this new electricity?
It depends on which program you are connected under. Under net-metering Yes your house will be supplied by the new electricity. Under microFIt it will also be supplied by the new electricity but indirectly. 100% of the power you generate goes straight to the street, then likely right back in to your house and your neighbours. 100% of the power goes to the grid to maximize your revenue.

Will I have electricity when the grid power goes down?
In most cases, No. If this is important to you than there are ways to do this but it does add to the cost.

Does the system connect through my current meter?
Under net-metering rules Yes. Under microFIT rules, No a new meter will be installed. The new meter monitors electricty going out to the grid.

I would like to use this electricity in my house and then send extra electricity to the grid?
This is what the net-metering program is all about. If you send extra power back to the grid they won't pay you for it but you will recieve a credit for it. You will then have 12 months to use up that credit.

How do you find dealing with the Local Electrical Distrbution Company (LDC)?
Every power distribution company is different. The folks at Halton Hills Hydro as well as Milton Hydro have been wonderfully supportive and we love working with them. Hydro One has also been very helpful to our efforts. At this time, most hydro companies in Ontario have had enough experience that the process is a smooth one.


Income

How much money will I make each month?
Your payments will vary depending on how sunny it is through the month and on seasonal differences. Obviously we get more sun during long clear summer days than we do during short overcast winter days. On average if you received $3,750/year your payments would be approximately:

January$237July$409
February$316August$383
March$358September$313
April$351October$261
May$399November$147
June$404December$167

Where does my cheque come from?
Under the microFIT program the money goes from the IESO to the Local Distribution Company (Hydro One, Powerstream, Halton Hills Hydro, etc.) The cheque goes directly from your Local Distribution company to you or in some cases they will deposit it directly to the bank account of your choice.

Who is my contract with?
Your contract is with the IESO which is the pseudo-government organization that regulates electricity in Ontario. The IESO has a mandate to ensure a reliable, sustainable supply of electricity for Ontario. While the IESO is not strictly a government agency but their directors are appointed by the Minister of Energy and they are essentially controlled by the same agency.

Can I trust the IESO to honour my 20 year agreement?
The credit worthiness of the IESO derives from the fact that it has the authority to recover all its costs from Ontario electrical customers through uplift charges. So basically they can’t go broke since they have a monopoly on the sale of electricity in Ontario and they have the right to charge whatever they need to.

Their credit rating is Aa1 which is the second highest available. Currently, only five US corporations hold a higher credit rating then the IESO, GE and IBM only have an Aa2 rating. The stocks and funds that your RRSP are invested in probably represent a higher risk of defaulting then a contract with the IESO.

Your PPA (Power Purchase Agreement) is a legally binding contract that is enforceable in court. It is a fairly straight forward document that does not contain any loopholes for the IESO to rescind your contract other than out right fraud on your part.

(See Credit Rating of the OPA for more information)

Do I have to register a business and charge HST?
You do not need to register a business but it wouldn't hurt to register for an HST number if you are enrolled in the microFIT program. The adavantage to an HST number is that you will able to claim back the HST portion of your system which can amount to thousands of dollars. The only downside is that once a year you will have to file an HST return. Once again, this only applies to microFIT projects. (See this link for more information).

Are there any tax breaks for the income that I receive from my Solar system?

This is really a question for your accountant but we will give you some ideas for you to discuss with him or her.

  • If you are enrolled in the microFIT program you will not need to pay income tax on the income until your system is completely paid off. Solar PV systems, including equipment and labour falls under Class 43.2 of the tax code and are subject to a 50% depreciation rate on a declining balance.

    “Class 43.2 includes certain high-efficiency cogeneration systems and renewable energy generation equipment acquired on or after February 23, 2005. This accelerated CCA rate will also apply to biogas production equipment and distribution equipment used in district energy systems that rely on efficient cogeneration, acquired on or after February 23, 2005, and before 2012.” (See Tax Incentives for Industry, Natural Resources Canada for more information.)

  • You may apply any costs that you incur in owning your system against the income. This would include additional insurance and interest payments if you finance the cost of the system. In the case of ground mounted system, you may be able to claim a portion of your property tax bill since they are taking up space on your property.
  • You may be able to claim the income in the name of the lowest income earner, your 3 year old probably isn’t going to qualify but a stay-at-home parent may be able to claim the income almost tax free.

Once again, you should discuss this with your accountant but at the very least you do not need to worry about paying taxes for at least the first nine years.


Your Location

Does it matter where I live?
Yes and No. From a technical standpoint, there are few areas in Southern Ontario that are not viable. From a practical standpoint it is possible to be denied a connection by your hydro company due to lack of capacity on your local line. If too many people on your line segment install solar you will be denied. Connections are awarded on a first come, first served basis.

I live on a farm. Is that okay?
Farm buildings are fantastic for roof-mounted systems.

I was told that because I live on a farm that I am not allowed to install ground mounted solar. Is this true?
The rules have changed for ground-mounted systems. Under version 2.0 of the MicroFIT rules: "A proposed microFIT Project that is either (i) a wind Renewable Generating Facility that has a Nameplate Capacity of 3kW or less; or (ii) a Non-Rooftop Solar Facility: 1) may not be located on a property on which residential use is Lawfully Permitted Use; and 2) may not be located on a property that Abuts another property on which residential use is Lawfully Permitted Use; however, for property where the Lawfully Permitted Use is agricultural, a wind Renewable Generating Facility that has a Nameplate Capacity of 3kW or less or a Non-Rooftop Solar Facility is permitted on such property or on property that Abuts such property if residential use is permitted as ancillary to the agricultural use."

It was a pretty annoying rule change and makes it difficult to put ground-mounted solar pretty much anywhere. If you are terribly interested in a ground-mount system and think your property satisfies these rules, contact us and we'll take a look at it.

Won’t the wind blow over the pole mounted solar arrays?
The wind on a ground mounted solar array can add up to several tons so this is certainly something we had to engineer our installations for. We have had professional engineers design supports and foundations that will withstand anything short of a tornado or hurricane. The support bases for a 16 unit array are buried 5’ under the ground and weigh over 20,000 pounds. It takes the concrete from two full concrete trucks to pour 3 foundations.


Financing

Where's the best place to finance my system?
You will absolutely get the best interest rate if you pursue a secured Line Of Credit with your own bank.

I'm not interested in financing with my bank. What options do you offer?
We have partnered with a major Canadian bank to facilitate our projects. We can help you fill out the forms and get it to the right people. Approvals are usually returned in a couple of days.

What are the rates?
Currently the rates for these unsecured loans are 6.99%. There are no discharge fees so if you need a temporary loan until your mortgage is up for renewal than this may be a good fit.

How much of a solar system can be financed?
100%. Installation included.

What are the chances I will be approved for your unsecured loan?
If you have a job and have paid your bills in the past then pretty good. Since this in an unsecured loan they don'd really care about home equity, just your ability to pay. The bank understands that you're getting a guaranteed income from the Ontario Government for the next 20 years.

If I can finance this whole thing at prime plus a couple points, but my income is about 12%... how on earth is this possible?
When you're sitting at home collecting money, be sure to send a thank you letter to your local Member of Parliament. Because it's the Ontario government that is making this possible. And you won't be the only one, there are currently almost 20,000 homes in Ontario taking advantage of this program.

I would really like to get a solar system but I can only afford 1 or 2 panels. Is it worth it?
See the point about financing above. If you calculate your return on investment (approximately 10%), then factor that against a favourable financing rate (2.5%)... you start to see why you should put up the biggest solar system your property can handle. Installing less than 4kW is probably not worth it.


The Green

What is the difference between mono-crystalline and poly-crystalline panels?
Mono-crystalline cells are made from a single crystal of ultra pure silicon. They are the original silicon solar cell and they are still the most efficient. Poly-crystalline cells are made up of multiple crystals and are generally cheaper to manufacture then mono cells. The gap in performance has narrowed significantly over the years to the point where they are almost the same. Both are good options.

http://en.wikipedia.org/wiki/Crystalline_silicon

How important is the efficiency of the panels that I buy?
The efficiency of a solar panel is its ability to convert solar energy into power. A panel that has an efficiency of 15% converts 15% of the solar energy that falls on it into power.

There is a great deal of hype about how efficient one panel is over another. What efficiency translates into in real terms is how many square feet does it take to generate a certain amount of power, the more efficient the panel the less space they take up. If you have limited roof area then a more efficient panel will allow you to put more kW’s on your roof.

The downside though, is that the more efficient a panel is, the more it will cost per watt. It may be possible to buy 30% efficient panels but they will cost twice as much as 17% panels and therefore will not make sense for most people. On the other hand if we use panels that are too inefficient like thin film, our mounting costs are going to be more expensive since we will be mounting twice as many square feet of panels.

Panel efficiency is just one of many factors that go into delivering a system that is optimized for the maximum ROI (return on investment), which is always our goal.

I heard there is a new breakthrough in solar technology coming, should I wait?
It may come as a surprise to many people but solar photovoltaic cells are not new. They were first discovered in 1839. There have been many breakthroughs since then but the advancements are getting smaller. In Europe, large solar plants cover 1000’s of acres and have for years. There may be a company or university that claim to be on the verge of a breakthrough but there always will be. If you put money down on a solar system today, your ROI will be the same today as tomorrow, a year from now, or ten years from now. Advancement in technology or price in the future will never mean you've made a bad investment today in solar technology today.

I have heard that solar panels are going to drop in price in the future, should I wait?
(The answer to this question is kind of old, but as one can see still very relevant. The prices of panels have come down a long ways and thus so have the rates.) This may be a difficult concept to grasp, but if the price of solar panels were less right now then small generators like homeowners would actually make less money. Let me explain: The government has set the Feed-In Tariff price at a level that they believe will cover costs and provide a reasonable rate of return. One of the biggest factors when setting this price is the price of solar panels. If panels were to cost half as much as they do now then the Feed-In Tariff would probably be closer to 20 cents not 40 cents. Sure, we could install twice as many panels for the same price and same return but most of us do not have unlimited roof space and even if we did, there would still be the 10kW limit.

The second part of this answer is a little easier to understand. The price of panels (internationally) has dropped drastically over the past couple years but this has little to do with technology. Due to the global credit crisis, there have been many large cancellations which have led to a temporary oversupply in the market. We would actually expect the price of panels to slowly rise in the near future if the financial world works out its problems.

How much energy is used to manufacture a solar panel?
With current production methods a solar panel will take 3 years to generate the power that it takes to produce it. With the average lifespan of a solar panel being between 30 and 40 years we would estimate that a solar panel will generate at least 10 times the energy that it takes to produce it. source

Does the manufacturer of solar panels release greenhouse gases?
Not directly but if we were to factor in the energy it took to make the panel in all the different phases of the manufacturing process, it has been estimated that solar energy releases 25 to 32 g/kWh. This compares favorably to coal which releases 960g/kWh or even clean burning natural gas which releases 590g/kWh. The only technology that releases less g/kWh would be wind turbines or hydroelectricity. source

Will generating solar power reduce the use of nuclear power in Ontario?
No, but it will reduce the use of coal and other fossil fuels. The output of nuclear power stations is not adjustable. They are always running at the same rate. If there is excess power, they throttle back the gas generation first.

From a global warming perspective, does it make sense to cut down trees that might shade my solar array? Don’t trees help reduce global warming?
This is a great question. Trees reduce carbon in the atmosphere by building plant tissue out of it and locking the carbon away. Unfortunately this is only temporary, when the tree dies and is burned or rots, the carbon is released back into the atmosphere. Solar panels reduce carbon in the atmosphere permanently by generating power that would have been generated by coal or other fossil fuels.

Let’s put it into perspective. An average tree in the Canadian climate will temporarily reduce carbon in the atmosphere at the rate of about 20kgs of carbon per year. An average 10Kw solar array will permanently reduce the amount of carbon in the atmosphere by about 15,000kgs per year. source

The Rules

I heard that all MicroFIT systems must have domestic content. Do yours?
This requirement was challenged under WTF rules and has since been dropped. We are no longer required to have domestic content equipment on new contracts.

I read that some people installed solar systems and then were denied a contract. Is this true and could this happen to me?
No and No. This is what you are likely referring to: The OPA (the predessor to the IESO) announced in March 2009 that there would be a FIT program coming and released some preliminary rules. A small number of people took a risk and installed systems before the rules were finalized. The final rules released in October 2009 included a domestic content rule that these “early adopters” were not in compliance with and therefore they were initially denied a contract. The media backlash from these early adopters was severe enough that the OPA eventually gave in and included an exemption from the domestic content rule for anyone that had installed a system prior to October 2009. The rules are established and finalized at this time and all of our systems are compliant with the domestic content rules.

Ok, but I read more recently that some people installed solar systems and then were denied connection agreements by their local hydro company. Is this true?
This can still happen if the rules and procedures are not followed carefully. To be safe, we wait for approvals from both the IESO, and your local hydro company before proceeding with any work. Should we fail to receive approval and have to cancel your project, then we will return your deposit in full.

Update: With the new rules it is entirely possible to be denied a connection agreement by your local distribution company. Which is why we don't proceed with an installation until all of our approvals are in place. As an FYI, the only LDC (that we know of) that has been denying connections to date is Hydro One.



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