Proposed Amendments to the Electricity Act, 1998, Ontario Energy Board Act, 1998 and the Energy Consumer Protection Act, 2010 to enable an affordable energy future

The Ministry of Energy and Electrification (ministry) is seeking feedback on legislative amendments that would enable integrated energy resource planning and kick start early actions to ensure Ontario’s energy system remains affordable, reliable and clean while supporting intensifying electrification and economic growth. These proposed changes align with and support progress on Ontario’s policy vision, "Ontario’s Affordable Energy Future: The Pressing Case for More Power". 

1. Integrated Energy Resource Planning Amendments

The ministry is seeking feedback on proposed amendments to the Electricity Act, 1998, which would enable an integrated energy resource planning process by:

• Ensuring energy planning is integrated and considers all forms of energy including electricity, natural gas, hydrogen and other energy resources, as well as energy efficiency, storage and demand management.
• Changing the name of the plan from “Long-Term Energy Plan” to an “Integrated Energy Resource Plan” to reflect a planning process that is more integrated.
• Updating the goals and objectives of the Integrated Energy Resource Planning process to align with the priorities of an evolving energy sector in the province.
• Creating a predictable planning cycle for investors, stakeholders and Indigenous communities by requiring integrated planning consultations to begin at least once every five years from the issuance of the last plan.
• Establishing regulation-making authority to define the specific technical information, documents or reports that would need to be considered in the development of future Integrated Energy Resource Plans.
• Enhancing agency implementation processes by removing the requirement for the Independent Electricity System Operator (IESO) and Ontario Energy Board (OEB) to submit implementation plans to the Minister if they receive an implementation directive. While directives could still require implementation plans or other agency reports, this amendment would provide flexibility to enable government to move quickly on issues that would not benefit from additional planning and report-back steps.

2. Electricity Connections to Support Growth

The ministry is seeking feedback on proposed amendments to the Ontario Energy Board Act, 1998 to enable more timely and cost-effective electricity grid expansions to support high growth areas. The proposed amendments would give Government regulation-making authority to change how costs are allocated and recovered for transmission and distribution connection infrastructure where the prospect of load materializing in the future is very likely.

If this legislation is passed, the ministry would propose regulations that could allow for allocating costs for certain electricity system connection infrastructure, particularly in high-growth areas. Regulation(s) could include provisions that reduce the cost and financial burden on 'first mover' customers and enable more timely development of connection infrastructure to enhance system readiness for industrial and housing development and electrification. The design and implementation of the regulation(s), including the types of projects that would be subject to new cost-allocation and the controls to ensure that costs are allocated fairly, will be determined through a separate consultation process. Parties can access that consultation process below.

3. Exemptions for Electric Vehicle (EV) Charging Companies and Flexible Billing

The ministry is seeking feedback on proposed amendments to the Ontario Energy Board Act, 1998, the Electricity Act, 1998, and the Energy Consumer Protection Act, 2010 (the Acts) to support the growth of EV adoption in Ontario.

​These proposed amendments would state that the  Acts do not apply with respect to the distribution or retail of electricity for electric vehicle charging. This would confirm that EV charging companies are exempt from regulation under these Acts for their EV charging activities, such as licensing, rate setting and reporting. Regulation of these activities would impose administrative burdens and barriers to entry, and unnecessarily limit billing options that EV chargers can employ (e.g., billing based on volume of electricity used for charge). 

​The ministry is also proposing to establish regulation-making authority to enable government to apply certain electricity retailing and distribution requirements in the Acts to EV charging, should there be a need to introduce such requirements in the future. 

4. Programs to increase Energy Affordability

Ontario currently offers a suite of electricity energy efficiency (EE) programs that are funded through electricity rates to address electricity system needs and help customers reduce their electricity consumption and bills. Current legislation limits the Independent Electricity System Operator (IESO) to only administer EE programs that result in electricity savings. The ministry is seeking feedback on proposed amendments to the Electricity Act, 1998 that would enable the IESO to administer enhanced energy efficiency programs that support beneficial electrification (BE) - the use of electricity instead of other fuels to reduce overall energy use and subsequently reduce costs for high consumption activities such as home heating and cooling, regardless of fuel-type (i.e., propane, oil, wood).

If the proposed legislative amendments are passed, this programming could be funded through electricity rates to provide direct assistance to customers to help reduce energy costs and participate in electrification.

Proposed amendments would also include adding additional purposes of the Act and objects of the IESO in connection with BE programs. 

Background

Strong economic growth, increased electrification and a population forecasted to increase by two million people over the coming decade means there will be a much greater demand for affordable, reliable and clean energy to power Ontario’s future. The IESO has forecasted electricity demand is expected to rise by 75% by 2050. Coordinated planning and action is needed now to ensure Ontario has the energy resources and infrastructure needed, both electricity and natural gas, to support growth, and to support customer choice and affordability throughout the energy transition.  

​The above proposed legislative amendments would enable Ontario to move away from its historically siloed energy planning processes to manage growth and the energy transition in a paced and targeted way that is coordinated across electricity and other fuels. They would also address current challenges and barriers that may not sufficiently incent timely and cost-effective grid-expansion, that may be creating uncertainty for EV charging companies that may slow the deployment of EV charging infrastructure, or that may be limiting the types of energy efficiency programs that are available to ensure all customers have options to reduce their energy usage and costs.   

Environmental Impact

The ministry considered its statement of environmental values in application to these proposed legislative amendments.

The proposed integrated energy resource planning amendments will have a positive environmental impact, particularly when taken together with the new object added to promote electrification. A portion of the amendments also articulate that an integrated energy resource plan may discuss goals and objectives including building a clean energy economy for future Ontarians. Separate consultations will be had on integrated energy resource plans and further consideration would be given at that time to potential environmental impacts of the plan.

The proposed amendments enabling timelier and more cost-effective electricity connections to support growth would create regulation-making authority that intends to make it easier and more cost effective for homes and businesses to choose clean electricity for their energy needs. The proposed amendments would not change the existing Environmental Assessment process, which will remain the core mechanism by which the environmental costs and risks of electricity infrastructure expansions are evaluated and environmental protections are planned.

The proposed legislative amendments in relation to EVs would facilitate the development of EV charging infrastructure, enabling EV charging station owners and operators to invest confidently in expanding their services. This, in turn, supports uptake of EVs thereby reducing emissions.

The proposed legislative amendments to increase energy affordability would enable the IESO to administer programs that support BE. BE programs would provide incentives to adopt clean electricity measures for use in daily life and provide consumers with more options to reduce their overall energy use and emissions without compromising comfort while reducing their energy bills and carbon footprint.

​For example, by switching from oil space heating to a cold-climate air-source heat pump, a single-family home in Ontario can reduce up to 50% of heating energy use, which would translate to a reduction of up to $2,500 in their annual heating bill and a reduction of GHG emissions by up to 4.5 tonnes/year.