Clash over natural gas comes to Ontario's electrical grid
Ontario is preparing the largest energy procurement in its history, which will reshape its electrical grid for decades to come, but it’s also headed for a possible collision course with federal policies designed to phase out natural gas by 2035.
Last week, Ontario Energy Minister Stephen Lecce said he wants an “all-of-the-above approach” to procuring energy and added natural gas to the list of acceptable sources, which already included nuclear, hydroelectric, renewables and biomass.
Much is at stake as the province faces sharply rising energy consumption and rolls out a series of long-term procurements in the next year and a half or so. Collectively, the contracts — each expected to last 20 years — could add as much as 5,000 megawatts to the grid, enough for five million homes.
But Lecce’s “technology-agnostic” approach means the province may sign natural gas contracts that extend beyond the federal government’s planned phase-out date of 2035, and it’s unclear who would foot the bill if natural gas is banned before the contracts expire.
“There’s a broader debate on the extent to which we as a country should continue to be using natural gas,” Reena Goyal, a lawyer at Blakes, Cassels & Graydon LLP who focuses on energy law, said. “There’s a debate at the federal level versus the provincial level.”
Ontario’s decision marks the latest clash on the country’s journey towards a net-zero electrical grid and raises questions about what role natural gas can or will play as a transition fuel in the coming decades.
At the federal level, Environment and Climate Change Canada (ECCC) has drafted federal Clean Electricity Regulations (CER) that create emissions standards that effectively force natural gas to be phased out by 2035, with
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