The Independent Electricity System Operator has submitted a report to Energy Minister Todd Smith laying out technical advice on how to proceed with future procurements as the province seeks to secure more electricity supply in the face of rising demand, the Crown corporation told QP Briefing.

"We will be submitting the report to the Minister today and then awaiting any direction," a spokesperson said.

With some of Ontario's nuclear plants going off-line for refurbishments or being shut down entirely in the next few years, the IESO predicted the province will need to get more electricity supply over the next decade and beyond.

To that end, in late January Smith told the IESO to finish medium-term procurements and get started on long-term procurements to be delivered later this decade.

In April of this year, Smith issued another directive to the IESO, asking for further technical advice on additional procurements that could be delivered in 2025 or 2026. The IESO's 2022 annual acquisition report highlighted the need for additional capacity beyond what was already planned.

"While some of the capacity needs identified in the 2021 annual planning outlook for 2025 and 2026 are expected to be met through last year’s planned actions, more supply is needed," the report said.

According to Smith's January directive, the additional procurements "could include an expedited procurement, an additional process to incent expansions of existing facilities, and an enhanced capacity auction."

The next step is for Smith to report back to the IESO with further direction.

For interim NDP leader Peter Tabuns, also his party's energy critic, the work currently being done by the Ford government and the IESO should've been done a long time ago.

"We knew four years ago that we were going to be looking at some shortfalls in the mid-2020s," Tabuns said. "Frankly, the planning should have gone on then, and the renewable energy project should not have been cancelled. Making sure you have a functional, sustainable, affordable electricity system is pretty critical to running a society."

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The process is also raising environmental concerns. York University professor Mark Winfield, who co-chair's the school's Sustainable Energy Initiative, said the criteria for the procurements makes it seem like the province is "fixed on pursuing gas."

Smith had told the IESO in October 2021 to explore a moratorium on new gas projects and how to get Ontario to decarbonize its grid.

Smith's Nov. 10, 2021 directive said the government is "technology agnostic" in terms of its future procurements.

But, Winfield said, "everything we've seen in the criteria so far, kind of points in that (gas) direction."

The criteria state the projects must be dispatchable, capable of generating more than one megawatt, and can transit a continuous amount of electricity for at least four consecutive hours.

A "dispatchable" source of electricity is one that can be turned on or off, meaning it can respond to demand.

"If you want that degree of dispatchability and sustained contribution, and no consideration of environmental performance, then you are kind of pointing in the direction of gas in the current context," he said.

After he was sworn in as Minister of Energy last month, Smith told QP Briefing he'd directed the IESO to "consider all options" to meet the province's supply needs.

"That includes every type of electricity," Smith said, adding he was working diligently to ensure there will be enough power to supply many projects in the works under the Ministry of Economic Development, Job Creation and Trade.

Smith's work this term includes releasing an updated long-term energy plan to set out fresh projections concerning the province's energy supply and demand.

"We working on that with the Independent Electricity System Operator to ensure that we have the supply that we're going to need for our province going forward as electrification continues to grow in the province," said Smith.

"That's why a couple of months back we set out that electrification panel that's also going to be working alongside the ministry and the Independent Electricity System Operator to ensure that we're meeting the supply needs that we have in the province in the most sustainable way," he added.

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Energy supply procurement process moving forward as demand grows in Ontario

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