Ontario to Procure 5,000 Megawatts of Energy for Grid to Meet Rising Energy Needs

Ontario Energy Minister Stephen Lecce speaks in Toronto on Aug. 31, 2023. The Canadian Press/Spencer Colby

Ontario is seeking bids for new energy projects to increase its electricity grid by up to 5,000 megawatts, marking the largest competitive energy procurement in the province’s history.

Energy Minister Stephen Lecce said the project will address the increasing energy needs of Ontario’s growing population while also considering the need to preserve farmland and giving municipalities a say in future energy projects.

“Our ‘all-of-the-above’ energy resource approach will expand access to affordable electricity to families and businesses across Ontario while opposing the regressive carbon tax,” Lecce said during an Aug. 28 press conference in King City, Ont.

Lecce described the government as “energy agnostic,” saying the new procurement will be a mix of natural gas, hydroelectric, renewables, nuclear, and biomass. The 5,000 megawatts will be enough to power 5 million homes.

The procurement process strategy has yet to be decided. The Independent Electricity System Operator (IESO), a Crown corporation tasked with managing Ontario’s electricity market, is expected to create a framework for this process by Sept. 20. The procurements are to be concluded by Feb. 28, 2026.

Even though the procurement method remains undetermined, Lecce said acting now is essential because the province will need at least 60 percent more energy by 2050. He pointed to population and industry growth as well as the rise of artificial intelligence as the primary contributing factors.

The IESO’s 2024 Annual Planning Outlook said demand will start outstripping supply by about 2029. Increased electricity demand from EVs, as well as the electrification of home heating and growing energy demand in the agricultural sector, will cause winter demand peaks to reach the same level as summer peaks by 2030, the report said.

Input From Farms and Municipalities

Powering and protecting Ontario farms and listening to municipalities will be a huge part of the plan, Lecce said, adding that it will be up to the towns to decide if they want to host a particular energy project. Ground-mounted solar farms will also be banned entirely on prime agricultural land, he said.

“We now will also require an agricultural impact assessment before considering any project in a prime farm area,” he said. “Long gone are the days where Queen’s Park imposes on unwilling communities undermining those agricultural areas, and unlike the former government, who forced large energy projects and unwilling communities, we will respect the voices of our communities.”

The Association of Municipalities of Ontario (AMO) and the Ontario Federation of Agriculture (OFA) are both throwing their support behind the project.

“AMO is pleased that municipalities will continue to play an important role in determining whether to host local energy projects,” AMO president Robin Jones said at the press conference.

“Municipalities are best positioned to identify the right locations for energy infrastructure while protecting our environment and community well-being.”

OFA president Drew Spoelstra applauded the plan, calling it a “major step forward.”

“What’s important about this new procurement framework is that it balances our energy needs with the protection of our prime agricultural land,” he said, adding that the introduction of agriculture impact assessments for new energy projects “is another positive step.”