The Green Energy Act, 2009 would provide two measures aimed at cutting the red tape for renewable energy projects and sources. One would give the Government of Ontario the power to designate, by regulation, renewable energy projects and sources, and to prescribe, again by regulation, the circumstances in which activities related to the designated project or source can be undertaken. Any restriction that would otherwise be imposed by law – with limited exceptions – on those activities would be inoperative.

The other measure would be the creation of a "Renewable Energy Facilitation Office" within the Ministry of Energy and Infrastructure. This Office would be supervised by the Renewable Energy Facilitator and, under his or her direction, would facilitate the development of renewable energy projects by working with proponents and other ministries in securing provincial and (if any) federal approvals.

Significant amendments to 15 other statutes would provide the following measures that are designed, as a package, to expand the scope of renewable energy in Ontario:

  • a feed-in tariff program to procure energy from renewable energy sources;
  • the right to connect to transmission and distribution systems for renewable energy generation facilities that satisfy the applicable technical, economic and other requirements for connection, as well as priority access to those systems;
  • development of a "smart grid" and expansion of transmission and distribution systems;
  • recovery by electricity distributors of their expansion costs;
  • exemption of renewable energy projects from the land-use approval process;
  • streamlined process for securing environmental approvals for renewable energy projects; and
  • consultation with aboriginal peoples concerning, and participation of aboriginal peoples in, the development of renewable energy projects.

Feed-in Tariff Program

The Electricity Act, 1998 would be amended to enable the Minister to direct the Ontario Power Authority to develop a "feed-in tariff" or procurement program that would provide standard program rules, contracts and pricing for classes of generation facilities, differentiated by energy source or fuel types, generator capacity and the manner in which the generation facility is used, deployed, installed or located. This program would replace the current Renewable Energy Standard Offer Program for small generators, in effect, and would resemble European-style feed-in tariffs. The program would be designed to promote renewable energy investments by easing market entry while, at the same time, addressing the price spread between renewable sources and traditional sources of energy.

Right to Connect and Priority Access

The Electricity Act, 1998 would be amended in two ways. One would provide renewable energy generators with a "right to connect." Transmitters and distributors would be required to connect renewable energy generation facilities to their systems when those facilities satisfy the applicable technical, economic and other requirements. The other would provide renewable energy generators with "priority access." Transmitters and distributors would be required to give renewable energy generators priority connection access to their systems. Other generators, as well as retailers and consumers, would continue to have non-discriminatory access vis-à-vis one another.

The Ontario Energy Board Act, 1998 would be amended to make priority access a condition of the licences held by transmitters and distributors. There is no corresponding provision for the right to connect.

"Smart Grid" and System Expansions

The Ontario Energy Board Act, 1998 would be amended in two ways. One set of amendments involves the smart grid. The following would be added to the electricity objectives that guide the Board in carrying out its statutory responsibilities: to facilitate the implementation of a smart grid. A "smart grid" is a two-way system that monitors and automatically optimizes the operation of the interconnected elements of the power system – from generators through transmission or distribution systems, or both, to consumers and their own devices – as a means of increasing grid efficiency, reliability and flexibility.

The Minister would be given the power to issue directives requiring the Board to take specified steps relating to the establishment, implementation or promotion of a smart grid. A smart grid would better accommodate the requirements of distributed and intermittent generation.

The other set of amendments involves system expansions. The Minister would be given the power to issue directives, requiring the Board to take specified steps relating to the connection of renewable energy generation facilities to transmission and distribution systems. Any such directive may also require the Board to amend the licence conditions of transmitters, distributors and other licensees to take specified actions relating to their systems.

These actions could include enhancing, reinforcing or expanding their systems. The Board must approve any such action – with certain exceptions – and, in doing so, would consider whether the action is "in the public interest." Economic efficiency would no longer count, though, because the Board would need to consider "the promotion of the use of renewable energy services." The Board would become a "promoter," in other words, and no longer an economic regulator when system expansions are needed to connect renewable energy generation facilities.

Cost Recovery by Distributors

The Ontario Energy Board Act, 1998 would be further amended to enable electricity distributors to recover, in their rates, the costs of enhancing, reinforcing or extending their systems according to prescribed criteria (by regulation). The Board's discretion in this regard will be tightly constrained by regulation or ministerial directive. The Board must provide rate protection to prescribed consumers (by regulation) by reducing the rates they would otherwise pay according to prescribed rates (by regulation).

A distributor would be entitled to be compensated for the consequential lost revenue, however, and the compensation would be collected from "all consumers" according to prescribed rules (by regulation); for example, how the Board would calculate the amount to be collected, as well as when and how the amounts would be collected and distributed, would be prescribed (by regulation).

Removal of Land-Use Hurdles

Bill 150 would significantly reduce hurdles for renewable energy generation facilities and projects that would otherwise result from the land-use approval process. Bill 150 would shift planning powers away from municipalities for these projects and facilities, in effect, and thereby remove opportunities for opponents to interfere at the municipal level.

The Planning Act would be amended so that any municipality's official plan could not affect these facilities and projects. They would also be exempt from zoning and related by-laws, demolition control by-laws, the development permit system and other planning by-laws or restrictions. Leases made for the purposes of these facilities and projects would be exempt from subdivision and part-lot controls if they are for periods of 40 years or less.

Streamlined Environmental Approvals

Bill 150 would streamline the environmental approval process by amending the Environmental Protection Act to create a "renewable energy approval" category. This new category replaces the multiple approvals currently required under this statute that a renewable energy project would otherwise require. Bill 150 would make consequential amendments of the Clean Water Act, 2006 and the Ontario Water Resources Act.

The Environmental Protection Act would be further amended by adding Part V.0.1 – Renewable Energy. The purpose of the new Part is "to provide for the protection and conservation of the environment," whereas in sharp contrast, the purpose of the other Parts of the statute is to do likewise for the "natural environment." The definition of "environment," for the purposes of the new Part, is much broader than the definition of "natural environment;" for example, the former includes "social, economic and cultural conditions."

The Minister of the Environment would have the power, under the new Part, to issue policies for renewable energy approvals. Decisions of both the Director and the Environmental Review Tribunal must be consistent with those policies.

The Environmental Protection Act would also be amended to further reduce the opportunity for project opponents to use the environmental approval process to stall a renewable energy project. Any party who wishes to challenge a decision of the Director granting a renewable energy approval, could only require a hearing by the Tribunal on the grounds that "engaging in the renewable energy project in accordance with the renewable energy approval will cause serious and irreversible harm to plant life, animal life, human health or safety, or the natural environment." If the Tribunal holds a hearing to review the Director's decision, moreover, the Tribunal’s jurisdiction would be specifically limited to considering only those grounds.

Aboriginal Peoples Consultation and Participation

The Electricity Act, 1998 would be amended to enable the Minister to direct the Ontario Power Authority to:

  • implement procedures for consulting aboriginal peoples and other specified persons or groups on the planning, development or procurement of electricity supply, capacity, and transmission and distribution systems;
  • establish measures, including programs and funding, to facilitate the participation of aboriginal peoples in the development of renewable energy generation facilities, and transmission and distribution systems; and
  • set out goals to be achieved in connection with the feed-in tariff program related to the participation by aboriginal peoples, and the involvement of local communities, in the development and establishment of renewable energy projects.