The Independent Electricity System Operator (IESO) of Ontario has awarded contracts for 1.3GW of new renewable energy capacity for 14 projects to be deployed in the Canadian province.
The projects received 20-year contracts under the IESO’s Long-Term 2 Request for Proposals (LT2 RFP), and comprise 12 solar projects, with a combined capacity of 915.1MW, and two wind projects, with a total capacity of 400MW. The IESO is still finalising contract negotiations with the successful applicants, and plans to announce full contract details, including prices, in May this year.
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CarbonFree, a Canadian carbon capture company, was a major winner in this round, with its renewable energy developer subsidiaries receiving awards for three solar projects, with a combined capacity of 381.2MW. One such subsidiary, CarbonFree Fort Frances, will develop a solar project of the same name near Fort Frances, north-west Ontario, which is the largest solar project by capacity in this auction round, of 167.2MW.
The news follows the first round of the government request for proposals, which was launched in 2023 and awarded contracts to projects that aim to begin commercial operation between 2026 and 2028. This round saw 13 contracts awarded, for a total of 2.1GW of capacity, with the majority of this capacity offered to battery energy storage systems (BESS), alongside two natural gas plants and a biogas project.
As a result, LT2 RFP is a clear shift towards renewable electricity generation, and sustained investment in batteries; IESO noted that it expects to award 1.6GW of BESS in LT2 RFP, as batteries are likely to continue to feature prominently in the province’s energy mix.
While IESO has awarded less capacity in LT2 RFP than it did in the previous round, it noted that it expects to complete another three procurement rounds, “making it the largest electricity procurement in Ontario’s history”, according to the system operator.
This round comes as Canada expects to significantly increase its operational solar PV capacity in the coming years. Figures from the Canadian Renewable Energy Association (CanREA) published last year estimated that Canada would add 17-26GW of new solar capacity over the next decade.
