As Ontario gears up to meet growing electricity demand, there is a major focus on expensive new generation. However, local utilities are demonstrating impressive results and savings through Distributed Energy Resources (DER) programs which, when aggregated and optimized, could mean the province may not need as much expensive infrastructure as they‘re planning for. DERs are not only modernizing the grid—they’re helping defer costly infrastructure upgrades and delivering tangible benefits to consumers and the energy system as a whole.
The underrated impact of DER programs
DERs—such as solar panels, smart thermostats, EV chargers, and battery storage—are reshaping how electricity is generated, consumed, and managed. While much attention is given to provincial and federal energy policy, there’s a quiet yet impactful transformation happening at the distribution level.
Programs run by local distribution companies (LDCs) have evolved into strategic tools for grid resilience and consumer empowerment. They’re proving that targeted, community-based initiatives can:
- Increase DER adoption
- Reduce peak demand
- Defer investments in traditional “wires” solutions
- Mitigate ratepayer costs
Lessons from the field: What makes a program work
To maximize impact, LDCs should consider the following design principles:
- Clarity and Alignment: Programs must clearly communicate expectations and outcomes. Avoid assumptions about consumer preferences—design with customer feedback to ensure alignment with diverse user goals.
- Simplicity and Accountability: Programs should be easy to understand for both energy professionals and everyday customers. Utilities should bear some performance risk to reduce complexity and build trust.
- Iteration and Learning: As DER usage evolves, programs must adapt. Whether it’s dispatch challenges or communication gaps, continuous improvement is key to long-term success.
Spotlight on Innovation: Leading LDC Projects
Here are five standout examples of LDC-run programs making a measurable impact:
Toronto Hydro – Local Demand Response
A pilot targeting local peak demand reduction, backed by the IESO Grid Innovation Fund and OEB Innovation Sandbox.
- July 3, 2025 activation curtailed 4MW
- OEB approved scale-up to 30MW through 2029
Alectra – Non-Wires Alternatives Local Capacity Auction
A pioneering pilot using local capacity auctions to procure DER-provided capacity to mitigate peak demand.
- May–Oct 2022: 6 activations, 8.1MW average peak reduction
- 167MWh delivered back to the grid; 15MW procured
Hydro One – myEnergy Rewards
A voluntary “bring your own device” residential demand response program using smart devices.
- 30,000+ households enrolled
- Each household can reduce peak demand by 1.6kW
- Total system impact: 48MW
Oakville Hydro – Smart Water Heating Pilot
A collaboration with Mattamy Homes and Hootwater to shift water heating load to off-peak hours.
- $5/month bill credit for activation
- Inspired by PG&E’s WatterSaver program, which saved 32kgCO₂e annually per household
Alectra – Centricity (Upcoming)
A flagship initiative under the Mission Innovation Green Powered Futures Mission.
- Aims to turn distribution grids into active market participants, helping LDCs develop their business beyond poles and wires while creating a new revenue stream for customers.
- Will share insights globally as the North American flagship project under Mission Innovation’s “Five Demos in Five Continents” initiative.
A Call to Action for Local Utilities
Considering the success of these programs, imagine if they were expanded and multiplied across the province. These programs are relatively inexpensive to run and stacking them together would mean up to dozens of new power plants wouldn’t need to be built. The clean energy transition won’t be won by policy and large energy procurements alone—it also takes cities and local utilities working together, neighborhood by neighborhood, meter by meter. Municipalities and LDCs have a unique opportunity to lead this transformation from the ground up.
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