Welcome to our fourth issue of the Provincial Spotlight Series, where we provide an overview of the latest policy updates, regulatory changes, and industry-specific developments in our members’ operating areas.
The previous issue, published on October 23rd, highlighted Saskatchewan. In this issue, we cover Ontario, diving into key topics relevant to the energy services, supply, and manufacturing sectors.
Note: The State of Industry Report is now available, free for members and can be located through the Member Portal. For non-members it’s available for purchase on the Enserva website.
Provincial Political Insights
- The Progressive Conservative government, led by Premier Doug Ford, remains focused on areas such as economic growth, affordability, and energy innovation. With the province forecasting a sharp rise in electricity use, the Ford government is promising an integrated energy plan to meet the skyrocketing energy demand in 2025, focusing heavily on nuclear power.
Regulatory & Policy Updates
- Expanding Energy Efficiency Programs: In recognition of the increasing electricity needs of industrial and residential sectors, Ontario has expanded its energy efficiency initiatives. Programs, such as broadening the scope of the CDM Framework, aiming to optimize power usage, reduce costs, and enhance sustainability for industrial users. In this regard, the province has a new Peak Perks program which provides a $75 financial incentive for residential customers that are willing to reduce their energy use during periods of peak demand.
- Powering Clean Energy: Ontario has a predominantly emissions-free electricity supply, primarily generated from hydropower and nuclear sources, with recent investments targeting new clean resources. The province plans to develop up to 4,800 MW of nuclear generation and are implementing a Clean Energy Credit Registry to align with growing ESG investment priorities. These initiatives aim to attract investments while maintaining reliable and affordable energy for consumers, contributing to the broader transition toward a clean energy economy.
- Critical Minerals: Ontario is aiming to position itself as a key supplier of critical minerals, following the 2022 release of its Critical Minerals Strategy. Following the 2022 release of Ontario’s Critical Minerals Strategy, the province experienced a 41% increase in critical mineral production and they now represent 33% of all exploration expenditures in the province. Investments have focused on minerals like nickel, copper, and lithium, which are essential for electric vehicle (EV) batteries. Additionally, over C$25 billion has been allocated to develop Ontario’s EV supply chain infrastructure, highlighting the province’s expanding role in this sector.
- Nickel: Ontario’s nickel production has gained momentum with projects like Canada Nickel’s Crawford site, which offers a large-scale, low-carbon nickel source with carbon sequestration potential. Other companies, like Magna Mining, advance ESG-compliant nickel production through streamlined permitting of brownfield sites. This accessible, sustainable production places Ontario at the forefront of North American EV and battery technology supply chains.
- Inactive Well Sites: Ontario is investing $7.5 million over three years – including $2.5 million in 2024 – to help municipalities mitigate risks associated with inactive oil and gas wells. This funding supports emergency preparedness, equipment acquisition, and training in nine southwestern Ontario municipalities, where approximately 27,000 old wells are recorded. This initiative builds on a $23.6 million provincial action plan addressing legacy wells, including the Abandoned Works Program, which provides financial assistance for high-risk well closures to protect public safety and the environment.
- Projected Electricity Cost Savings: Ontario’s Independent Electricity System Operator (IESO) estimates that policy changes will result in additional peak electricity savings by 2025, with a potential to lower costs by over $650 million.
Environmental, Social, and Governance (ESG) Trends
- Ontario is advancing its sustainability initiatives through enhanced Conservation and Demand Management (CDM) programs, which are expected to contribute to greenhouse gas (GHG) emissions reductions of up to three million tonnes over their lifespan. However, the overall effectiveness of these initiatives will depend on their adoption across various sectors and industries, as well as external economic and regulatory factors that could influence implementation and outcomes.
Challenges & Risks
- Ontario’s growing energy demand poses a significant challenge for the province. Although recent expansions in energy efficiency programs may help offset some pressures, there are concerns that the pace of infrastructure development may lag behind demand increases.
- Energy service providers, especially in the industrial sector, remain cautious about how well these initiatives will align with their operational needs. A thorough review of longer-term solutions, particularly around supply reliability and costs, will be critical for addressing potential risks in the sector.
The Bottom Line
Ontario’s recent updates to its regulatory framework and energy policies indicate an intention to manage rising demand while supporting sustainability. For the energy services and manufacturing sectors, the expanded CDM programs provide opportunities for improving energy efficiency, but there are still challenges to be addressed in terms of long-term energy reliability and infrastructure development.
