Ontario Government Boosts Energy Procurement Strategy
Ontario, a dynamic Canadian province with a population exceeding 15 million, has undergone significant evolution from its agriculture-dominated roots to becoming a centre of manufacturing and service-oriented economies.
With its population growth steadily increasing due to waves of immigration, industrialisation and urban development since the 19th century, the province's energy needs have also evolved to adapt to this expansion.
Originally dependent on coal, Ontario made a pivotal shift towards cleaner energy sources, completely eliminating coal-fired plants by 2014.
Today, the province's energy landscape primarily comprises nuclear, hydroelectric, renewables, natural gas and biomass.
This transformation has not only redefined how energy is consumed but also marked Ontario as a leader in reducing greenhouse gas emissions across Canada.
With energy demand growing rapidly, our government is stepping up by advancing our largest energy procurement in our history.
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.
Scaling up to meet energy demands
With a pressing need to cater to its increasing energy demands, the Ontario government recently announced a significant expansion in its energy procurement strategy.
Initially launched in August 2024, the plan was to procure up to 5,000MW of new energy capacities.
However, recognising the rapidly growing need, officials have now heightened this goal to 7,500MW.
The escalated plan is a response to new forecasts predicting the province will require a staggering 75% more electricity by 2050, equating to adding the electrical demand of four and a half Torontos to the grid.Stephen Lecce, Minister of Energy and Electrification, emphasises the expansion's significance.
He says: “Our government is expanding what is already the largest competitive procurement in the province’s history as demand for electricity continues to grow.
"This expanded procurement will deliver enough power for 1.6 million homes, which is critical as our population and economy continue to grow. Unlike the former government which allowed hydro rates to soar, we are keeping costs down by planning ahead and using competitive procurement.”
This initiative is part of a broader, 'all-of-the-above' strategy to ensure energy affordability.
In line with these developments, the government prompted the Independent Electricity System Operator (IESO) to explore options for conducting two additional procurements.
These efforts align with the overarching aim of lowering energy costs for both families and businesses across Ontario.
- All procured resources will be offered 20-year contracts, awarded annually between 2026 and 2029.
- Contracts will only be offered to projects with local community support.
- Demand stems primarily from the rapid increase in population, new manufacturing facilities, advanced technologies, data centres, the electrification of industry and the charging energy required for EVs.
Charting a sustainable path forward
Ontario's strategy for a sustainable energy future is multifaceted.
Beyond the enhanced procurement objectives, the roadmap includes several key initiatives designed to stabilise long-term energy supplies while keeping costs manageable.
Among these strategic pillars are:
- Energy planning: Development of Ontario's first integrated energy plan
- Nuclear energy: Advancement of clean, reliable and affordable nuclear power
- New transmission infrastructure: Priority designation for essential transmission lines in Southwestern, Northeastern and Eastern Ontario to support economic activities
- Keeping costs down: Expansion of energy efficiency programs to aid families and businesses in reducing energy consumption and saving money.
These steps are essential not just for economic growth but also for enhancing the province's appeal as a prime location for businesses.
Jaipaul Massey-Singh, CEO of the Brampton Board of Trade, supports this: “Access to sufficient, sustainable and affordable energy is not just vital to helping businesses grow, it’s also a key factor in attracting new businesses and investment.
"This announcement by the Ontario government will help our province continue to be a premier destination for industry and help our economy grow.”
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