Transforming Ontario’s electricity system

Ontario is transforming its electricity system. A decade ago, the province was facing reliability challenges. Since then, investments in the system, including building, refurbishing and upgrading much-needed infrastructure, have significantly improved reliability. More than 7,500 kilometers of Hydro One’s electricity transmission and distribution lines have been upgraded in the past few years.

These investments are also making our electricity system cleaner, greener and smarter through:

  • ambitious conservation targets – a 7,100 megawatt (MW) reduction of peak demand and 28 terawatt-hours (TWh) by 2030 – that will be achieved through innovative conservation and energy efficiency programs to help families and businesses save energy and manage their costs

  • a more efficient grid, with the installation of more than 4.7 million smart meters in homes and businesses across Ontario

  • a significantly cleaner supply mix through the elimination of coal-fired generation by the end of 2014 – this is the largest greenhouse gas reduction initiative in North America and will reduce the electricity sector’s carbon footprint by 75 percent

  • a significant increase in renewable and clean energy through our FIT Program for renewable energy.

All of this investment is essential for a reliable, modern and sustainable electricity system to support Ontarians’ lifestyles, fuel the economy and secure the future.

Ontario’s supply mix   
Ontario has a diversified mix of electricity resources that are used to meet the province’s electricity demands year-round – conservation, biogas, biomass, hydroelectricity, natural gas, nuclear, solar, wind and coal (coal-fired generation will be phased out of Ontario’s supply mix by the end of 2014). These resources work together to meet the electricity needs of the province from hour to hour. A variety of different resources is needed as no one type of resource can meet all of Ontario’s needs.

Feasible and cost-effective conservation is the resource of first choice. Conservation contributes to a sustainable electricity system and helps consumers manage their energy costs.

The following figure compares the installed capacity of each type of resource in Ontario’s supply mix in 2005 and at the end of 2012. During this period, the installed capacity in Ontario increased by 7,255 megawatts (MWs) – an increase of 23 percent. Installed capacity under contract to the OPA is about 40 percent of total installed capacity in the province.

The mix of supply resources is also cleaner, with coal being replaced by renewable generation, such as wind, solar and biomass; natural gas; refurbished nuclear units and more conservation.

Installed Generation and Conservation Capacity in 2005 and 2012

 Installed Generation and Conservation Capacity in 2005 and 2012
Source: IESO and OPA
Note: Conservation includes programs, codes and standards, rate structures and non-OPA programs.

The OPA’s role
The OPA is responsible for procuring new electricity resources, both generation and conservation. The OPA also provides advice to the government on province-wide electricity system plans, and works with local distributors and other electricity agencies and stakeholders to develop integrated regional electricity plans.

The government’s Long-Term Energy Plan (LTEP) provides a picture of the electricity sector, offering context for policy and regulatory decisions on future investment in generation resources, conservation programs and transmission projects.

The OPA signs contracts with power generators to ensure that long-term investments are made in generation facilities that otherwise would not get built. These contracts guarantee set prices to generators, enabling investors to finance and build these new projects in order to achieve government policy objectives. Find more in the current electricity contracts section.

At the end of 2012, the OPA was managing nearly two thirds of the province’s installed capacity -- 15,037 MW of new operating capacity under about 15,554 contracts. According to the ministry’s conservation discussion paper issued in July 2013, titled Conservation First: A Renewed Vision for Energy Conservation in Ontario, investments in conservation programs from 2005 to 2011 have allowed Ontario to avoid building new capacity that would have cost almost $4 billion.

Coordinating province-wide conservation efforts is another key role of the OPA, including working with local distribution companies to help consumers manage their electricity use and costs. From 2006 to 2011, conservation programs in Ontario have seen an investment of $2 billion, and in 2011 alone conservation programs saved 717 million kilowatt-hours (kWh) of verified and sustainable energy savings. Find more information in the 2011 Conservation Results Report.

More on the OPA’s activities can be found in our annual report and the quarterly supply reports.