Changes to Ontario's Net Metering Regulation to Support Community-Based Energy Systems

Regulation Number(s):
Instrument Type:
Bill or Act:
Ontario Energy Board Act, 1998
Summary of Decision:
On September 28, 2021, Ontario filed a new regulation, O. Reg. 679/21 (Community Net Metering Projects) under the Ontario Energy Board Act, 1998 (OEBA), along with supporting consequential amendments to O. Reg. 161/99 (Definitions and Exemptions) and O. Reg. 90/99 (License Requirements - Electricity Retailers and Gas Marketers), to enable community net metering (CNM) demonstration projects. The new regulation and consequential amendments came into effect upon filing and are expected to support community-based energy projects and innovative approaches to community energy planning by enabling a framework for CNM, while authorizing the West Five development as a demonstration project under the CNM model.
Analysis of Regulatory Impact:
The new regulation will provide an opportunity for the CNM model to be tested on a demonstration basis. Ontario businesses in the sector and in development and planning industries as well as utilities and government will benefit from the demonstration learnings in the form of improved policies and practices, while costs and other impacts are expected to be minimal. Key stakeholders directly impacted include the demonstration project proponents - the CNM customer (for the West Five development, Sifton Properties Limited) and the participating electricity distributor (London Hydro Inc. for the West Five development) - as well as electricity end-use consumers, and the provincial electricity regulator (Ontario Energy Board).

The overall compliance and administrative costs to the CNM demonstration project proponents are estimated to be approximately $77,700 over the 10-year term of the project. Actual costs may vary.
• The compliance costs include upfront and ongoing licensing fees for the CNM generator paid to the Ontario Energy Board; and upfront and ongoing operating costs of billing and settlement software for the host distributor and CNM customer to accommodate CNM credit allocation.
• The administrative costs include ensuring regulatory compliance through learning about the new regulation; legal fees associated with drafting of a CNM agreement; and recordkeeping and reporting costs associated with reporting requirements.
The Ministry estimates that a project involving 10-megawatts (MW) of embedded renewable generation would increase electricity system costs by a negligible amount relative to total system costs of Ontario's overall electricity system. The regulation currently authorizes one CNM demonstration project with a total capacity limit of 10 MW.
Further Information:
Proposal Number:
Posting Date:
October 8, 2020
Summary of Proposal:
The Ministry of Energy, Northern Development and Mines is seeking input on a proposal for community net metering demonstration projects. Community net metering refers to a net metering arrangement that allows for the transfer or sharing of credits from generation facilities within a community across multiple metered accounts. Enabling community net metering demonstration projects would provide customers and developers more options to participate in net metering initiatives that may help lower the community's costs and meet sustainability goals.

Contact Address:
77 Grenville St., 5th floor
Toronto, Ontario M7A 2C1
Effective Date:
September 28, 2021