Inside Ontario’s Competitive Energy Procurement Strategy
Home to more than 15 million people, Ontario’s population has grown steadily since the 19th century due to immigration, industrialisation and urbanisation.
Initially dominated by agriculture, Ontario has transformed into a hub of manufacturing and services.
With the rise in population, Ontario’s energy consumption has evolved alongside. Traditionally reliant on coal, the province transitioned to cleaner energy sources phasing out coal-fired plants entirely by 2014.
Primarily powered by nuclear, hydroelectric, renewables, natural gas and biomass, this transition has positioned the province as a leader in reducing greenhouse gas emissions in 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.
Meeting Ontario’s energy demand
To meet the soaring energy needs of the province, the Ontario government is expanding the largest competitive energy procurement in its history by 50%.
In August 2024, Ontario launched the competitive energy procurement with plans to procure up to 5,000 megawatts of energy to foster economic prosperity and meet growing demands for clean and reliable energy.
Since then, the government has increased this target to 7,500 megawatts to meet the updated electricity demand forecast projecting the province to need 75% more electricity by 2050 – the equivalent of adding four and a half cities the size of Toronto to its grid.
“Our government is expanding what is already the largest competitive procurement in the province’s history as demand for electricity continues to grow,” says Stephen Lecce, Minister of Energy and Electrification.
“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.”
Alongside the launch of the second competitive energy procurement, the government has asked the Independent Electricity System Operator (IESO) to provide options to run two additional procurements as part of its all-of-the-above approach to keep energy costs down for families and businesses.
- 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.
Ontario’s long-term affordable energy future
Procuring new long-term energy generation is only one part of the government’s plan to realise affordable energy, other areas include:
- Energy planning – Developing the first integrated energy plan for the province.
- Nuclear energy – Advancing clean, reliable and affordable nuclear power.
- New transmission infrastructure – Designating and prioritising transmission lines in Southwestern, Northeastern and Eastern Ontario that will power job creators.
- Keeping costs down – Expanding energy efficiency programmes to help families and businesses reduce usage and save money.
“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,” adds Jaipaul Massey-Singh, CEO of Brampton Board of Trade.
“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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