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LONG-TERM PROCUREMENTS – Incentivies investment in new
resources through longer periods and long-term contracts. Annually
from 2025 to 2028 and possibly beyond.
PROGRAMS – Meets electricity policy objectives in a more targeted
manner as directed. Local generation program aim for regular
application windows.
BILATERAL NEGOTIATIONS – Secures resources where a need
exists that can't be addressed in a practical and timely way through
competitive processes. Undertaken as needed.
Nonetheless, data on the price of energy purchased under each round of
the Local Generation Program will become visible to the public.
This will inevitably be compared with data on prices paid under other
procurements, creating economic pressure on participants and an
indirect form of competition. In addition, the IESO has a consultation
process underway designed to facilitate DERs bidding into the
wholesale market in aggregated forms. The Enabling Resources
program anticipates transactions of this nature within a year or two,
further enhancing competition.
What does the future hold?
Local Generation will be slotted under the fourth category,
procurement programs. Since the end of the MicroFIT program,
Ontario has not had a program to substantially encourage the
development of new Distributed Energy Resources, until now.
Will the new local generators compete against each other at the
same time as they compete against conventional forms of power?
Unfortunately, the Ontario market is not yet capable of supporting
direct real time competition between large- and small-scale resources.
According to the Minister’s Directive, the IESO will be rolling out
Ontario’s new local generation program in early 2026. IESO sta昀昀
anticipate that there will be two streams, one for “new build” generation
and one for existing facilities, with a call for proposals in each
stream once per year. The two streams will be staggered, resulting in
approximately six months between calls. The upper size limit is expected
to be 10 Megawatts (MW). Contracts for new build are expected to be 20
years, while contracts for existing facilities are expected to be 昀椀ve years.
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