Supporting Critical Transmission Infrastructure in Northeast and Eastern Ontario

The Ministry of Energy (ministry) is proposing to take certain actions to facilitate the timely development of three transmission projects across Northeast and Eastern Ontario. The proposed actions are intended to:

• Support planned transmission projects to be built on time and cost-effectively in response to rapid electricity demand growth in these regions over the next 10 years due to economic development priorities, electrification and decarbonization initiatives.
• Advance a shared goal of meaningful reconciliation by providing economic and partnership opportunities for Indigenous communities.

Our proposed actions for public feedback are as follows:

1. Prioritize Three Transmission Projects

In October 2022, the Independent Electricity System Operator (IESO) published its Need for Northeast Bulk System Reinforcements report and in December 2022, published its Gatineau End of Life Study. Both studies forecast electricity demand in Northeast and Eastern Ontario to grow at a rapid pace over the next 10 years due to economic development priorities (e.g., Ontario’s Critical Minerals Strategy) and electrification initiatives. To support this demand growth, the IESO has recommended new transmission lines be developed in northeast Ontario and in eastern Ontario. The ministry is proposing to bring forward an Order in Council that would, if approved, declare the following three transmission projects, recommended to be in-service by 2029, to be priority projects under under s. 96.1 (1) of the Ontario Energy Board Act, 1998 (OEBA):

1. The Mississagi to Third Line Line – a 230-kilovolt transmission line that will run approximately 75 kilometers from Mississagi Transformer Station (west of Sudbury) to Third Line Transformer Station (Sault Ste Marie);
2. The Hanmer to Mississagi Line – a 500-kilovolt transmission line that will run approximately 205 kilometers from Hanmer Transformer Station (Greater Sudbury) to Mississagi Transformer Station (west of Sudbury); 
3. The Greater Toronto Area East Line – a 230-kilovolt transmission line that will run approximately 50 kilometers from either Cherrywood Transformer Station (Pickering) or Clarington Transformer Station (Oshawa) into Dobbin Transformer Station (Peterborough).

Per s. 96.1 (2) of the OEBA, this declaration would require the Ontario Energy Board (OEB), the provincial economic regulator of the energy sector, to accept that the lines are needed when assessing whether the projects are in the public interest as part of its Leave to Construct review processes. This would streamline the OEB’s review processes and prevent delays to ensure that projects are brought online on time. The OEB would still be required to consider the interests of electricity consumers with respect to project costs and the reliability and quality of electricity service.

Declaring these transmission lines to be priority projects would not impact the requirement for the transmitter to obtain all required government approvals, including under the Environmental Assessment Act and obtaining Leave to Construct from the OEB. These approvals include requirements for the transmitter to consult with Indigenous communities, the public, and stakeholders on the proposed projects.

2. Designate Hydro One as Transmitter to Develop the Three Priority Projects

The ministry is also proposing to bring forward an Order in Council (to be recommended by the Minister of Energy) and companion Directive, to be made pursuant to s. 28.6.1 of the OEBA, that would, if approved, direct the OEB to amend Hydro One Networks Inc. (Hydro One)’s transmitter licence to require it to undertake development work and seek all necessary approvals to construct the transmission projects listed above.

Hydro One has adopted a policy that provides 50/50 equity opportunities for First Nations on certain transmission line projects. Designating Hydro One and their First Nations’ equity partnership model would provide Hydro One as the transmitter with the regulatory clarity needed to initiate project development work and advance Indigenous partnership discussions on the specified projects. This would help to avoid the possibility of delays in the approvals process which can add to development timelines and increased costs that are ultimately borne by electricity ratepayers.

Further, the development of these transmission lines is expected to advance reconciliation in a meaningful and inclusive way by creating economic opportunities for Indigenous communities, such as equity participation and jobs.  The proposed designated transmitter, Hydro One, established a First Nations equity partnership model in 2022, which offers First Nations a 50% equity stake in new transmission lines exceeding $100 million. ​All transmission lines outlined in this proposal exceed this capital threshold.​

With respect to the Mississagi to Third Line and the Hanmer to Mississagi line projects, Hydro One has demonstrated early engagement with potentially impacted First Nations. Those First Nations have indicated support for the project. In addition, Hydro One continues work with them and to advance its strategic partnership with Five Nations Energy to provide support during project planning, development, and construction. Furthermore, assigning these two projects, which are in close proximity to each other, to a single entity is anticipated to provide efficiencies that can result in cost and time savings, as well more transparent consultations with both Indigenous communities and stakeholders.

Consultation with Indigenous Communities on this Proposal:

The provincial Crown is committed to fulfilling its duty to consult Indigenous communities in respect of any conduct that may have the potential to impact Aboriginal and treaty rights.  The ministry will be providing information to potentially impacted Indigenous communities about how they can participate in the consultation process at this early stage of project development for these transmission lines.

This will include an opportunity to review and provide comments about this proposal through the Environmental Registry of Ontario (ERO), as well as opportunities for targeted consultation to share input about these proposed actions and potential for impacts to Aboriginal and treaty rights directly with ministry staff.  

Depending on the outcomes of consultation, including consultation with Indigenous communities, the ministry anticipates bringing this proposal forward for a possible decision in Fall 2023, to ensure the transmission lines identified above are able to meet the in-service dates that have been recommended by the IESO.

In addition, the province expects to delegate the procedural aspects of Crown consultation to the transmitter in respect of the three transmission lines, which may be fulfilled through environmental approvals and/or other provincial regulatory approvals and permits as appropriate.

Lastly, socio-economic impacts of transmission lines have been raised in previous consultations. We welcome input from your organization or community on the potential socio-economic impacts of transmission projects that are the subject of the proposed actions.

FOR INFORMATIONAL PURPOSES ONLY AND SUBJECT TO FUTURE CONSULTATION:

In addition to the three transmission projects noted above, the IESO has recommended through its planning studies that another transmission line be developed in northeastern Ontario, the Wawa to Porcupine Line. This project would entail a 230-kilovolt transmission line running 260 kilometers from Wawa Transformer Station (south of Wawa) to Porcupine Transformer Station (Timmins area).

The ministry is not currently proposing to prioritize or designate a specific transmitter for the Wawa to Porcupine Line, but will be engaging with Indigenous communities and interested transmitters to better understand Indigenous interests and the proposals from multiple licensed transmitters in Ontario that have expressed to the ministry an interest in developing this transmission line. While the ministry has received letters of support from some of the potentially impacted Indigenous communities for specific transmitters, it is important for the ministry to understand and hear from all potentially affected Indigenous communities on their interests and concerns before proposing a transmitter for designation. The delay in transmitter designation also intends to provide communities time to conduct their own due diligence and community engagement processes with transmitters.

Accordingly, to make an informed proposal on transmitter designation for this project, the ministry will continue to engage and gather information from interested transmitters and potentially impacted Indigenous communities at this time.  The ministry wishes to better understand proposed business models, transmitters’ experience, and Indigenous communities’ interest in partnership opportunities. This information gathering will occur in parallel to this posting and feedback received will be considered in a future proposal regarding transmitter designation and prioritization for the Wawa to Porcupine Line. The ministry anticipates undertaking a subsequent ERO posting for public feedback and undertaking rights-based consultation with Indigenous communities on this proposal in Fall 2023. Depending on the outcomes of those consultations, the ministry could bring a proposal on designation and prioritization for a possible decision in late 2023 or early 2024.

Taking additional time to contemplate prioritization and transmitter designation for the Wawa to Porcupine Line is possible as the recommended in-service date specified by the IESO is 2030, a year later than the other three lines.  

NOTE: As demand for electrification increases, the need for new transmission lines can be expected. The ministry recognizes the need for a more transparent and predictable approach to transmitter selection in the future. As such, the ministry is working with the IESO to develop a formal transmitter selection framework, which may incorporate a competitive process, to select transmitters in the future. This work may also consider whether to include additional components to assess socioeconomic impacts in the future transmitter selection framework. The ministry and the IESO will undertake consultations and engagements to provide stakeholders and Indigenous communities an opportunity to submit feedback on a formalized transmitter selection process in Ontario. There is insufficient time to develop and run a competitive process to select a transmitter for the projects described in this posting, due to the urgency of the need for these lines.