Key Takeaways From Ontario's Affordable Energy Act

• Published date: 02 January 2025
• Law Firm: Borden Ladner Gervais LLP
• Author: Mr John Vellone, Colm Boyle and Nicholas Pinsent

Advancing electrification and affordability in Ontario

On Dec. 4, 2024, Bill 214 the Affordable Energy Act, 2024, received Royal Assent. On the same date, many of the operative provisions of the Act came into force.

Introduced by Ontario Minister of Energy and Electrification Stephen Lecce on Oct. 23, 2024, this Act has three important schedules that outline its amendments:

1. Schedule 1: Amendments RE Energy Planning;
2. Schedule 2: Amendments RE Distribution System Code and Transmission System Code; and
3. Schedule 3: Amendments RE Electric Vehicle Charging.

Minister Lecce explained that Bill 214 would "enable the implementation of the province's first integrated long-term energy plan with a focus on affordability. It would also prioritize zero-emission nuclear energy to meet growing energy demand, expand programs to help families and businesses save money and energy, support EV adoption and, as well, reduce last-mile connection costs."

This article covers the key amendments and schedules of Bill 214 and highlights important takeaways for organizations that may be impacted or interested in pursuing energy projects in Ontario.

Background

Ontario's growing energy demand has emerged as a defining public policy challenge for the provincial government. As part of its efforts to address this, the government unveiled its vision for its energy future in October 2024 through Ontario's Affordable Energy Future: The Pressing Case for More Power. This strategy, bolstered by the Independent Electricity System Operator's (the IESO)2025Annual Planning Outlook projections of a 75 per cent increase in electricity demand by 2050, driven not only by population growth but also by industry, vehicle electrification and data centres.

This has spurred many policy initiatives in Ontario, including a recent expansion of the ongoing LT2 procurement.

The Affordable Energy Act, 2024 enacts parts of this vision into legislation. It aims to balance affordability, resiliency, and reliability with an integrated approach that reflects Ontario's complex energy system, which includes a mix of electricity and natural gas systems. This Bill intends to "enable the implementation of the province's first integrated long-term energy plan with a focus on affordability."

Schedule 1 - Amendments RE Energy Planning

Schedule 1 of Bill 214 contains numerous amendments to the Electricity Act, 1998 (the Electricity Act) and a consequential amendment to the Ontario Energy Board Act, 1998 (the Ontario Energy Board Act). These can be broken down into four main elements:

1. Amending the purpose of the Electricity Act, 1998 "to promote electrification and facilitate energy efficiency measures aimed at using electricity to reduce overall emissions in Ontario";
2. Similarly amending the objectives of the IESO;
3. Replacing "long-term energy plans" with "integrated resource...