Ontario reorients electricity grid access

Data centre development that aligns with Ontario’s economic development priorities has been promised a preferential place in the queue to connect to the electricity grid. The recently released provincial energy plan sets out the new policy, which is coupled with proposed amendments to Ontario’s Electricity Act introduced shortly before the legislative assembly began its summer recess in mid-June.

As proposed, grid connection requests for new data centres and other designated energy-intensive loads made after June 3, 2025 would be subject to an approvals process that considers both the merits of the new venture and its likely impact on electricity capacity and other consumers in the vicinity. This would replace the existing automatic approval for applicants that has each new candidate joining at the back of the line.

“As we experience increasing energy demands — not only from our energy-intensive industries, but also from the pressures of attracting new investment to the province — we have to ensure we are taking action to prioritize projects that create good jobs and get these projects connected to the energy they need,” says Sam Oosterhoff, Ontario’s Associate Minister of Energy-Intensive Industries. “This policy will protect and promote data centres, while also protecting our ability to attract large manufacturing facilities to our province.”

Province-wide electricity demand is projected to increase by 75 per cent by 2050 to keep up with growth and the ongoing transition to electric vehicles, heating sources and industrial processes. Data centres are expected to be a significant chunk of that, accounting for 13 per cent of new electricity demand over the next ten years. Already, requests for grid connections to serve data centres currently in the development stage amount to 6,500 megawatts (MW) or the equivalent of the Bruce nuclear generating station’s output.

At the same time, economic development strategists are striving to capture soaring worldwide investment in data centres and the smart technologies they enable. Northern Ontario and rural communities are particularly identified in the new energy plan as areas where data centres would be welcome to potentially “anchor new high-tech ecosystems”, create jobs and diversify the economic base. The plan also places a priority on “domestic data hosting”.

The proposed legislation generally sets out the intent of the new approvals process, but leaves much of the details for still-to-be-developed regulations. The latter will establish the criteria for when the approvals process is required, the steps that must be taken and the entities that will be authorized to make the decisions.

“These measures will ensure we’re not just plugging in servers — we’re powering Canadian opportunity, protecting Canadian data and jobs, and making sure energy is used where it delivers real value to our country,” maintains Stephen Lecce, Ontario’s Minister of Energy and Mines.

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