Image: Chirayu Trivedi, Unsplash
The Canadian The province of Ontario is planning large-scale, competitive energy purchasing.
The Second Long Term Procurement (LT2), announced by the Ontario government as the largest in the province’s history, is expected to consist largely of new bioenergy, solar and wind projects.
In a letter to the province’s IESO, Stephen Lecce, Ontario’s minister of energy and electrification, said procurement must be transparent, competitive and cost-effective to secure technology-independent energy sources.
He asked the IESO to prepare a draft procurement framework by September 20, 2024 and consider how to finalize energy and capacity procurements by February 28, 2026.
The Ontario government said LT2 should encourage projects in northern Ontario and projects that avoid key agricultural areas, and ban all projects in special agricultural areas and ground-mounted solar in key agricultural areas. Proposed projects will also need municipal support to ensure local support.
In his letter to the IESO, Lecce said he supports the use of an Enhanced Power Purchase Agreement (EPPA) revenue model “to help facilitate cost-effective and efficient market operation of new energy projects.”
Lecce said electricity demand in Ontario has increased for the first time since 2005, with renovation schedules for the area’s nuclear facilities and electricity supply and capacity winding down, meaning additional electricity sources are needed to meet growing needs to fulfil.
The IESO has recommended purchasing approximately 5,000 MW of new electricity sources by 2034.
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