THE FUTURE

Without immediate action to expand generation capacity and undertake significant demand-side measures, Ontario faces an electricity shortfall in the long term. New initiatives are restructuring the province's power system in order to address this critical challenge.

Taking Action

Ontario's challenge has been for the last number of years, and continues to be, how to ensure a sustainable, reliable and efficient power system over the long-term. Aging infrastructure, continued growth in demand, accumulated public debt and the drive toward increased environmental sustainability have all intensified the need for change. Ontario's IESO works at the heart of Ontario's power system - managing our needs today - and providing the foundation for the future.

Efforts on a variety of fronts have been launched to address these concerns.

Long-term Supply

While our immediate power needs are being met, Ontario faces a long-term supply shortfall. By 2014, close to 13,000 MW of Ontario's electricity requirements will need to be met with new supply or demand-side resources.

The Ontario Power Authority (OPA) is charged with overseeing long-term planning in Ontario and identifying what new generation, transmission and demand measures are needed. Together with the provincial government, the OPA has announced a series of new projects to address the expected supply shortfall. More information about these projects can be found at the Ministry of Energy and OPA websites.

The wholesale market plays an important role in this process. While new suppliers will receive investment guarantees, they will participate in the market and be paid wholesale prices.

The OPA has been set up as a long-term transitional body - once Ontario's power system has matured and mechanisms to ensure sustainability are firmly place, it is anticipated that its role will no longer be needed.

Paying the True Cost of Electricity

Electricity prices - for both the home consumer and the large-volume consumer - have become more reflective of the cost to produce. The Ontario government has created new pricing structures that are based on trends in the wholesale market.

Homeowners and other small businesses pay rates based on their total consumption over the period of a month. Within the next few years, almost all consumers in major urban centres will be using smart meters to track how much electricity they use and when they use it, with pricing structures that offer lower rates during off-peak periods.

Wholesale customers (businesses who use more than 250,000 kWh a year) pay the wholesale rate but also receive a provincial benefit and other rebates that mitigate against volatile prices. This combination provides a certain level of price stability over the short-term, while maintaining important pricing signals that encourage large-volume users to cut back on consumption if supplies are tight.