The global energy landscape is undergoing a profound and rapid transformation. Driven by technological change and the commitment to address climate change, societies around the world are developing ways to decarbonize their energy supply and improve energy efficiency. Against this backdrop, transforming Ontario into a clean energy economy is a key strategic opportunity for the province. By building on our history and wealth of industry expertise, innovation and abundant clean energy resources, and in partnership with Indigenous communities, Ontario can prosper in the global transition to a clean energy economy. To seize this economic opportunity, government will need to align economic and social forces around the common vision and purpose necessary to navigate a multi-decade social, economic, and political process that will affect every sector and community in Ontario.

The Government of Ontario established the Electrification and Energy Transition Panel to advise government on opportunities for the energy sector to help Ontario’s economy prepare for electrification and the energy transition, and to identify strategic opportunities and planning reforms to support emerging electricity and fuels planning needs.

Panel engagements with stakeholders and Indigenous partners, carried out between December 2022 and July 2023, revealed broad-based enthusiasm to seize the opportunities of electrification and energy transition. These conversations were crucial to the Panel’s deliberations, along with written submissions and an extensive review and analysis of the experience and future commitments and plans of other jurisdictions in Canada and internationally. Informed by this research and engagement, the Panel’s recommendations lay out the principles and next steps for Ontario to navigate and succeed in the transition towards a clean energy economy in the long term:

  • Establishing a government-wide commitment to develop a clean energy economy by 2050 to align private, social and public forces, and act as a catalyst for pursuing dynamic opportunities to enhance Ontario’s prosperity.
  • Articulating a clear strategic policy vision to focus the sector, bring alignment in managing change and deliver an orderly transition that prioritizes affordability, reliability and resilience. This is an urgent need.
  • Building meaningful partnerships with Indigenous communities that advance reconciliation and provide Indigenous opportunities in electrification and energy transition. Partnerships are the only way Ontario will be successful in making energy infrastructure investments at the pace and scale necessary to build a clean energy economy.
  • Carefully modifying the existing institutional framework in which the Ministry of Energy continues to lead energy planning. This is the best way to achieve cross-sector coordination and prepare for electrification and energy transition. Government will need to provide direction on complex and contentious issues to ensure an orderly transition that allocates resources effectively and protects customers.
  • Undertaking a series of actions to ensure that Ontario’s planning and regulatory systems are ready for electrification, support the move to a clean energy economy and can manage increasing pressures in a proactive, coordinated and adaptive manner. The Independent Electricity System Operator (IESO) and the Ontario Energy Board (OEB) will play central and distinct roles in this process.
  • Ensuring effective collaboration and integration in energy planning across fuels, especially electricity and natural gas, across end use sectors and across levels of government, to ensure investments and innovation can be deployed in a way that unlocks their full value.
  • Most importantly, building and maintaining public support for electrification and the energy transition with a principled pragmatic approach grounded in cost-effectiveness and solutions tailored to the specific and often local needs and circumstances of people as customers, citizens and community members. Ontarians need to be able to see themselves and their community in the province’s clean energy economy vision. Governments and the energy sector have important roles to play in supporting and working with customers and communities in this process.

Overview of recommendations

Below is an overview of the Panel’s recommendations. The full text of each detailed recommendation can be found in the respective sections of the report and listed in Section 10 at the end of the report.

Planning for Electrification and the Energy Transition

Recommendation 1: The provincial government should develop and communicate a commitment and associated policy principles for achieving a clean energy economy for Ontario by 2050.

Recommendation 2: The provincial government should convene an internal clean energy economy planning and implementation body, such as an existing committee of Cabinet.

Recommendation 3: The provincial government should continue to seek alignment and coordination of clean energy economy objectives, standards and policies with other governments (within and outside Canada) whenever practical and consistent with the province’s economic and policy interests.

Recommendation 4: The Ministry of Energy should develop and communicate an energy transition policy vision that is inclusive of Indigenous perspectives and informed by clean energy economy policy principles.

Recommendation 5: The Ministry of Energy should develop and release on a regular cycle an integrated long-term energy plan that will guide Ontario’s development of technical energy plans, strategies and actions to support the transition to a resilient and affordable clean energy economy.

Recommendation 6: The Ministry of Energy should provide policy direction on the role of natural gas in Ontario’s future energy system as part of its next integrated long-term energy plan.

Recommendation 7: The Ministry of Energy should develop a strengthened framework for local energy planning and decision-making and take steps to facilitate its implementation.

Recommendation 8: The provincial government should establish an external Energy Transition Advisory Council to provide advice, independent of government and on an ongoing basis, on the overall trajectory of Ontario’s energy transition, emerging governance or energy system-level questions and the integration of energy planning and coordination with sectoral strategies.

Recommendation 9: The provincial government should fund, on an ongoing basis, independent whole economy energy pathways studies, in a way that allows for iterative improvement of modelling and assumptions, transparency on costs, and with meaningful input from relevant stakeholders and Indigenous communities.

Governance and accountability

Recommendation 10: The Ontario Energy Board (OEB) and Independent Electricity System Operator (IESO) should take steps to enable the effective evolution of innovative business models in line with clean energy economy goals and to help consumers benefit from electrification and the energy transition.

Recommendation 11: Safety regulators and technical standards organizations must be included in energy planning and energy sector regulation to enable proactive coordination and the effective deployment of new technical solutions.

Recommendation 12: The OEB should employ all tools within its existing mandate to implement activities consistent with Ontario’s goals for a clean energy economy and the requirements of the energy transition for Ontario.

Recommendation 13: In the years following release of the energy transition policy vision (Recommendation 4), the provincial government should undertake a review of the OEB’s activities in respect of achieving objectives within the policy vision to determine if potential legislative and/ or regulatory changes are needed to implement the vision effectively.

Recommendation 14: The IESO should be empowered, within the broad direction established by government, to independently procure electricity resources and lead bulk-system planning (including potential use of interties) and regional electricity system planning.

Recommendation 15: The OEB should conduct reviews of cost allocation and recovery policies for natural gas and electricity connections, as well as natural gas infrastructure investment evaluations to protect customers and facilitate development of the clean energy economy.

Recommendation 16: The Ministry of Energy, working with the OEB, IESO, LDCs, municipalities and gas utilities, should develop a formal and transparent co-ordination framework that sets out the scope and objectives for enhanced planning and co-ordination at the bulk, regional and distribution levels.

Recommendation 17: To make full use of the innovation in distributed energy resources and the electricity distribution sector, the OEB and IESO must continue to find ways within their existing mandates and in anticipation of the clean energy economy policy commitment (Recommendation 1) to provide proactive and transparent thought leadership on regulatory policy and critically review and revise their existing policies and processes.

Recommendation 18: The government should regularly assess the need for resources (skills, staff, other supportive resources) across ministries and agencies to steer energy planning and decision-making competently and effectively through the energy transition, and ensure required resources are provided.

True partnerships with Indigenous partners

(Note: There are several other recommendations across the report referencing Indigenous partners and recommending actions to support meaningful Indigenous participation in the clean energy economy.)

Recommendation 19: The government should support meaningful Indigenous participation in the clean energy economy through consistent and enhanced capacity building support.

Recommendation 20: The government should advance economic reconciliation through flexible financing models and mechanisms that incentivize Indigenous project ownership across small, medium and large-scale energy projects.

Recommendation 21: The government should amend the enabling statutes of the IESO and OEB to ensure Indigenous representation on the Boards of Directors.

Recommendation 22: The Ministry of Energy should review its current resources to enhance the Ministry’s capacity to support Indigenous partners’ effective participation in energy planning and decision-making.

Innovation and economic development

Recommendation 23: The Ministry of Energy should take further steps to reflect in policy and regulation the key role that clean, affordable and reliable energy will play in the development of globally competitive and future-oriented industries by enabling proactive planning decisions, fostering effective and efficient permitting and identifying key clean energy value chains.

Recommendation 24: The government should consider a mission-oriented approach to economy-wide industrial strategy that is centered on the development of a clean energy economy.

Recommendation 25: The government should clearly set out a policy vision for how electrification and the energy transition will be funded, including a realistic assessment of the distributional impacts of funding choices on different groups.

Consumer, citizen and community perspectives

Recommendation 26: The government, IESO and OEB should play a key role in engaging with the public and Indigenous partners to ensure transparent access to high-quality information and meaningful opportunities to participate in decision-making.

Recommendation 27: The government should explore mechanisms to support broad adoption of fuel switching, decarbonization and supportive technologies, including active engagement and communication on benefits and risks as well as mechanisms to help customers manage up-front costs.

Recommendation 28: Existing electricity rate mitigation and affordability programs should be redesigned to better target support to those who need it most, and to streamline program application and enrollment processes for increased accessibility.

Recommendation 29: The government, IESO and OEB should support capacity building for utilities and communities to conduct assessments of climate change impacts to energy infrastructure and to support effective climate resilience efforts and adaptation planning and implementation.