Net Metering

This notice was originally posted in the old Environmental Registry under number RO04E0001.

Description of regulation

The Ministry of Energy has prepared a proposed Regulation for public review and comment that would require electricity distributors to allow customers generating electricity from eligible renewable sources to deliver electricity to their distributor and receive a credit which would result in the customer only paying for their net consumption of electricity. The proposed regulation would be made pursuant to clause 88(1)(g.1) of the Ontario Energy Board Act, 1998, a copy of which is available at the second link below. The proposed Regulation: (available at the first link below)

• Specifies eligible renewable sources as wind, solar, water and agricultural biomass.


• Specifies the maximum size of a customer's net metering generator as 500 kilowatts (kW).


• Specifies that the credits received by the customer are calculated on the same basis as the charges by the distributor for electricity delivered to the customer.


• Specifies that net metering customers must be generating for their own use and, therefore, are not selling electricity for consumption by others. Section 57 of the Ontario Energy Board Act, 1998 requires all generators connected to the grid, including through a distributor, to be licensed by the Ontario Energy Board. Section 4.0.3.1 of Ontario Regulation 161/99, found at the third link below, exempts net metering customers from the licensing requirement, provided they only receive credit against consumption and are not paid outright for electricity by the distributor.


• Specifies an annual accounting cycle during which unused credits can be carried over from one bill to the next. Any credits not used at the end of the year are reduced to zero. This provision will accommodate differences, caused predominately by seasonal variations, between a net metering customer's consumption and generation. This is a practice common to many other jurisdictions with net metering regulations. The proposed Regulation allows the distributor some control over the options a customer might have for the month during which the annual cycle begins. This is to accommodate variations in distributor meter reading and billing cycles. As a minimum, an option in the last quarter of the calendar year must be available to the net metering customer.


• Specifies that any existing net metering agreements that are not consistent with the proposed Regulation continue on until expiry and, so long as both parties agree, may be renewed without any change.

The proposed Regulation does not address the physical connection of the net metering generation equipment to the distributor's system. The Ontario Energy Board established connection procedures and criteria for all generators, including self-generators who net meter, which distribution utilities are required to adhere to as a condition of their distribution license. Information on this is found at the fourth link below. As required under section 70 (6.1) of the Ontario Energy Board Act, 1998, the Board will also be establishing the maximum cumulative net metering capacity that local electricity distribution company must allow.

Purpose of regulation

Many customers are interested in generating electricity for their own use from renewable sources. However, their consumption profiles will rarely match their generation profiles. Net metering makes it much more practical for such customers to proceed, because it eliminates the need for relatively inefficient battery systems which, in the absence of net metering, are required to address the difference between customers consumption and generation profiles.Net metering will result in an increase in clean self-generation, which will benefit the entire electricity system. A kW of new net metering generation will be just as effective as a kW of new commercial renewable generation in providing added generation capacity to the electricity system. It will also benefit the environment because a greater portion of the province's electricity supply will be from clean renewable sources.

Other public consultation opportunities

All comments will be considered as part of the decision-making by the Ministry if they:

1. are submitted in writing;
2. reference the EBR Registry number; and
3. are received by the Contact person within the specified comment period.

Please Note: No acknowledgment or individual response will be provided to those who comment. All comments and submissions received will become part of the public record.

Regulatory impact statement

This regulation entitles self-generators using water, wind, solar and farm biomass as a source of electricity generation to net meter. Previously, net metering was permitted only at the option of distributors. The regulation also enables self-generators who net meter to receive credit for the value of excess generation they return to the distributor, for application against future charges related to electricity consumption for up to one year. For example, billing in this manner would allow farming operations who propose to install wind generation to apply the value of excess electricity generated in the Winter against their Summer electricity consumption. This method of accounting and billing would also be advantageous to highly seasonal water power generators. In most cases, even when distributors did voluntarily allow net metering, they did not allow the carry-forward of credits from one bill to future bills.