First Nations and Métis are leaders in Ontario's energy sector, bringing their unique perspectives, knowledge and leadership to energy planning, projects and policies. They have created an unprecedented level of First Nation and Métis involvement in the energy sector:

  • First Nations and Métis are now leading or partnering on over 600 wind, solar, and hydroelectric generation projects across Ontario, accounting for over 2,200 megawatts (MW) of clean energy capacity.
  • First Nations lead, or are partners with, transmission companies on several major transmission lines.
  • Nearly 100 First Nations are participating in the Independent Electricity System Operator's (IESO) Aboriginal Community Energy Plan program. These community-led energy plans assess a community's current energy needs and priorities and explore options for conservation and renewable energy.

The Province takes its duty to consult First Nation and Métis seriously and is committed to ensuring they are consulted on any energy activity that could potentially affect their Aboriginal and Treaty rights.

Many First Nations and Métis across Ontario face energy-related challenges: the need for reliable and affordable power, energy-inefficient housing and inadequate infrastructure, to name just a few. The causes and solutions to these challenges are rooted in complex historical, jurisdictional, geographic and regulatory contexts, but progress is being made. The Province is committed to working together with First Nations and Métis to identify issues and propose actions that advance reconciliation and healing.

The Chiefs of Ontario and the Province signed the First Nations-Ontario Political Accord on August 25, 2015, creating a formal bilateral relationship framed by the recognition of the treaty relationship.

The Ontario-Métis Nation Framework Agreement, signed in 2008 and renewed in 2014, guides the Province's relationship with the Métis Nation.

The Province will continue the direction established in the 2013 LTEP and support First Nation and Métis leadership and capacity in Ontario's evolving energy sector. Reflecting the Province's strong energy supply position, Delivering Fairness and Choice responds to the concerns heard through the LTEP engagement process and the ongoing dialogue between the government, its agencies and First Nation and Métis partners.

Building on the conversations during the LTEP engagement process, the Province commits to a more regular and ongoing dialogue with First Nations and Métis. This will include energy awareness and education initiatives, the involvement of youth in the energy conversation, and a more regular communication to ensure First Nations and Métis are informed about the Province's energy commitments and have opportunities to provide insight and feedback.

Addressing electricity affordability

A major priority for Indigenous and non-Indigenous electricity consumers is to improve the affordability of their electricity. The government is working to address the issue with programs such as:

  • The Ontario Electricity Support Program (includes enhanced credits for First Nations, Métis and Inuit electricity consumers) (more details in Chapter 1);
  • Ontario's Fair Hydro Plan (more details in Chapter 1);
  • The Low-Income Energy Assistance Program (more details in Chapter 1); and
  • The Conservation First Framework (more details in Chapter 4).

First Nation delivery credit

The Province recognizes that First Nation electricity consumers living on-reserve face unique challenges with respect to electricity affordability. Customers living on-reserve often pay higher distribution costs than customers in more populated areas because distribution rates are partially based on population density. The problem of higher distribution rates is often exacerbated by energy-inefficient homes on reserves that lead to higher levels of energy consumption.

To address these unique energy affordability challenges, First Nation leaders recommended the elimination of delivery charges for electricity transmission and distribution when they met with the Minister of Energy and other energy sector leaders at the First Nations-Ontario Energy Table in April 2016.

The minister directed the Ontario Energy Board (OEB) to work with First Nations to research options that would address energy affordability on reserves, and to report back on its findings. Acting on the OEB's findings and feedback from First Nations, the Province collaborated with the Chiefs of Ontario to develop the First Nations Delivery Credit. The First Nations Delivery Credit was implemented on July 1, 2017 and provides a credit equal to 100 per cent of the electricity delivery charge on the bills of on-reserve First Nation residential customers of licenced distributors. This collaborative effort between the Province and First Nations is another example of the Political Accord being brought to life.

Connecting off-grid First Nation communities

Twenty-five remote First Nation communities in the province's northwest rely on diesel fuel to power their communities. The Province recognizes the distinct challenges they face and, because of the high cost of diesel fuel, there is a good economic case to connect as many as 21 of those communities to Ontario's electricity grid.

The Province has made it a priority to connect these remote First Nations. Communities cannot improve their housing, their water treatment systems or other community infrastructure if they do not have a reliable and adequate supply of electricity.

Connection to Ontario's low-carbon electricity grid will not only improve the quality of life of these communities and enable their economic development, but it will also reduce local pollution, greenhouse gas (GHG) emissions, and the environmental risks associated with transporting and storing diesel fuel.

Figure 20: Reducing diesel generation in remote First Nation Communities

Reducing diesel generation in remote First Nation Communities

For these reasons, the government has taken several steps to begin the connection of remote First Nation communities. These include:

  • Selecting Wataynikaneyap Power as the transmitter for connecting most of the remote First Nations;
  • Creating a mechanism for funding a portion of project costs; and
  • Advocating for a fair cost-sharing arrangement with the federal government that ensures the project is fully funded and can proceed to construction.

The Province also supports the connection of the five remote Matawa communities that are not currently part of the Wataynikaneyap Power project. Further steps will be taken to advance their connection when proposals are brought forward.

Grid connection is not currently feasible for four of the 25 remote First Nations in Ontario. Each of these communities has begun the planning and development work to add sustainable technologies that will reduce their reliance on diesel. Projects that reduce diesel reliance could include renewable microgrids, battery storage, and other innovative technologies that meet identified community needs.

The government will continue to partner with these communities and other collaborators, and is looking to the federal government to support these projects. The Government of Canada has agreed to financially support the early connection of Pikangikum First Nation and Wataynikaneyap Power plans to begin construction in 2017 to connect this First Nation.

Conservation

Over 40 First Nations participated in the Aboriginal Conservation Program between 2013 and 2015. The program funded energy efficiency upgrades such as new insulation, appliances and lighting for approximately 3,000 First Nations households.

Through the 2015-2020 Conservation First Framework, First Nation and Métis customers also have access to other energy efficiency and conservation programs, such as the Save on Energy programs offered by local distribution companies.

While conservation programs are working well in some First Nation and Métis households, participants in Delivering Fairness and Choice engagement sessions said the programs need to be more flexible and more widely available.

In conjunction with the mid-term review of the Conservation First Framework and engagement with the Indigenous communities, the IESO will give the Province options for improving conservation programs and their availability for First Nations and Métis, including the 10 communities served by unlicensed LDCs in North-Western Ontario known as the Independent Power Authorities: Eabametoong, Keewaywin, Muskrat Dam, Nibinamik , North Spirit Lake, Pikangikum, Poplar Hill, Wawakapewin, Wunnumin and Weenusk.

The Climate Change Action Plan allocates $85-$96 million from cap and trade auction proceeds for collaboration with Indigenous communities. This includes establishing a fund for community level GHG reduction projects and for community energy and climate action planning in First Nation communities, particularly to reduce emissions from buildings and infrastructure, and for the development of carbon sequestration projects.

Implementing community energy plans

Community energy plans are an important way to understand local energy needs better. They help communities identify opportunities for energy efficiency and clean energy and develop a plan to meet their community's energy goals. Close to 100 First Nations are now developing community energy plans, using funding from the Aboriginal Community Energy Plan (ACEP) program. The Province is committed to continuing this funding.

But energy plans are just a first step and the Province recognizes that further support is needed to turn these plans into tangible actions and results. That is why the ACEP program will be expanded to help communities implement their community energy plans and support the Climate Change Action Plan.

The IESO will engage with First Nation and Métis communities and organizations to identify the strengths and weaknesses of the current ACEP program, explore the use of conservation projects or other community-directed energy initiatives, and then recommend changes that allow community energy plans to flourish. Funding will come from the $10 million the IESO has dedicated for this and other support programs.

Supporting local opportunities

Building sector knowledge and capacity

The IESO's Education and Capacity Building (ECB) program supports the education, training and skill building of First Nations and Métis. The ECB program will continue to support initiatives that help build local business skills, energy literacy, and youth engagement.

Exploring energy projects and partnerships

The IESO's Energy Partnerships Program (EPP) supports First Nation and Métis communities and organizations that want to lead or be partners on renewable energy and transmission projects.

Three streams of funding from the EPP help support:

  • Financial, legal and technical due diligence so First Nations and Métis can partner on major priority transmission lines and renewable energy projects;
  • The development of renewable energy projects, including costs for regulatory approvals; and
  • Initiatives that reduce the reliance on diesel fuel for the four First Nations that can't be feasibly connected to the transmission grid.

The government will engage further and explore how to change these programs so they better reflect the needs of First Nations and Métis within the current energy system. This may include an examination of how programs can help integrate small-scale renewable energy projects into the local energy system, or the use of net metering and other innovative solutions that address local or regional energy needs and interests.

Access to financing

The development of energy projects requires significant financial and human capital. Barriers can prevent First Nation and Métis communities and organizations from accessing this capital so they can actively participate in the energy sector. Barriers to more widespread First Nation and Métis participation include:

  • Lack of capital at reasonable terms;
  • High financing costs; and
  • A shortage of capacity around financing and building partnerships.

The Aboriginal Loan Guarantee Program has helped First Nations and Métis obtain lower-cost financing to participate in large-scale energy projects. However, Ontario recognizes that barriers to financing remain, particularly for smaller-scale projects. As a result, the government will engage with First Nations and Métis to identify gaps in financing, possible changes to existing programs, and alternative financing models.

The government can build on its strong record and apply innovative financing models to promote First Nation and Métis participation in energy projects. These financing models and social finance tools have been successfully used in the United States, Australia, and elsewhere in Canada to facilitate greater Indigenous economic participation.

The Province also appreciates the unique social benefits that can accrue to First Nations and Métis with their participation in energy projects. Measuring and assessing these non-financial benefits could help the government take a broader and more inclusive view of outcomes when deciding on energy policies and projects.

Building on these and other successes across the province, Ontario will take the following actions to increase First Nation and Métis access to financing:

  • Engage with leaders, organisations and financing experts to identify financing gaps and barriers to the participation of First Nations and Métis in energy projects;
  • Investigate innovative financing models to better support First Nation and Métis participation in energy projects; and
  • Develop methods to better capture the social, environmental, and local benefits of First Nation and Métis participation in energy projects.

Expanding access to natural gas

Natural gas remains a clean, reliable energy option, and it will continue to play a critical role in Ontario's energy mix. Access to natural gas is an important issue, especially for First Nations.

To assist with natural gas expansion, the government launched a new $100 million Natural Gas Grant Program in April 2017. Through the program, municipalities and First Nation communities are able to work with natural gas utilities to bring forward proposals to expand access to natural gas. The guidelines for the Natural Gas Grant Program state that special consideration will be given to projects located in Northern Ontario or located within First Nation reserves. Successful applicants under this program can then apply to the OEB for leave-to-construct approval for their expansion projects.

Over the coming years, the Province looks forward to seeing natural gas expansion projects deliver greater consumer choice and economic growth to municipalities and First Nations in Ontario.

Summary

  • The government will review current programs in order to improve the availability of conservation programs for First Nations and Métis, including communities served by Independent Power Authorities.
  • The Province, working with the federal government, will continue to prioritize the connection of remote First Nation communities to the grid and support the four First Nation communities for which transmission connection is not economically feasible.
  • The Aboriginal Community Energy Plan program will be expanded to help communities implement their energy plans and support Ontario's Climate Change Action Plan.
  • The government will engage with First Nations and Métis to explore options for supporting energy education and capacity building, the integration of small-scale renewable energy projects, net metering and other innovative solutions that address local or regional energy needs and interests.
  • Innovative financing models and support tools will be investigated to address barriers to the financing of projects led or partnered by First Nations or Métis.
  • The government will report back to First Nations and Métis between Long-Term Energy Plans to provide updates on the province's progress and seek ongoing feedback.
  • The government's Natural Gas Grant Program will support the expansion of natural gas access to First Nation communities.

Accessible descriptions

Figure 20: Reducing Diesel Generation in Remote First Nation Communities

Figure 20 is a map of northwestern Ontario which shows the location of twenty five remote First Nation communities relative to other towns and existing transmission infrastructure. A grouping of 16 communities located north of the towns Pickle Lake and Red Lake are communities proposed for connection through the Wataynikaneyap Power project. The communities that are part of Wataynikaneyap Power’s project are: Pikangikum, Poplar Hill, North Spirit Lake, Deer Lake, Kee-way-win, Sandy Lake, North Caribou Lake, Muskrat Dam, Sachigo Lake, Bearskin Lake, Wapekeka, Kitchenuhmaykoosib Inninuwug, Kasabonika Lake, Wawakapewin, Wunnumin Lake and Kingfisher Lake.

A grouping of five communities to the east, located northeast of Pickle Lake, are communities that could be connected through future grid connection projects. The communities that could be connected by future proposals are: Webequie, Nibinamik, Neskantaga, Eabametoong, and Marten Falls.

There are four remote communities. Two are further north than the other communities, near the coast of Hudson’s Bay, and two are located northwest of Nipigon Ontario. These are the four communities where it is not economical to connect to the grid, and other diesel reduction initiatives will be pursued. The four communities that are not economical to connect are: Weenusk (Peawanuck) and Fort Severn in the far north, and Whitesand and Gull Bay (Kiashke Zaaging Anishinaabek) northwest of Nipigon.

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