Energy Storage Canada urges Ontario to unlock BTM battery capacity

Ontario BTM Battery Capacity leads the call for a Distributed Reliability Track to contract behind-the-meter energy storage, bridge near-term grid reliability gaps, and create bankable procurement pathways amid IESO demand growth and the Pickering retirement.

Energy Storage Canada is urging Ontario to establish a Distributed Reliability Track to unlock behind-the-meter and distribution-connected battery capacity as a fast, financeable tool for meeting near-term system needs. The recommendation, set out in the associations recent report prepared with research support from Peak Power, argues that distributed energy resources are central to executing commitments in the provinces Integrated Energy Plan.

The case for action rests on a tightening supply outlook. The report cites rising electricity demand, the planned retirement of 2,100 MW at Pickering in 2026, and a projection of 65% demand growth by 2050 from the system operator. It contends that long-lead generation and transmission projects will not deliver capacity for more than five years, while Ontario needs firm, dispatchable power within 12 to 24 months, aligning with broader canada grid reliability investment priorities across the sector.

ESC positions behind-the-meter battery energy storage systems as grid-reliable assets that can be deployed within weeks. Yet today, these systems are largely treated as demand response rather than infrastructure, limiting their ability to support reliability and investment. The report highlights how the Global Adjustment mechanism drives most revenues by rewarding peak shaving, a design that undervalues broader reliability services. That framing dovetails with ongoing ontario grid modernization supply chain efc advocacy discussions across the industry.

According to the analysis, current Ontario BESS revenues average roughly CAD$210,000 to CAD$250,000 per MW per year, with 80% to 90% tied to peak management under the Global Adjustment. Infrastructure-grade financing typically requires about US$290,000 per MW per year, leaving an unpriced gap of roughly US$108,000 to US$137,000 per MW that reflects grid services batteries can technically deliver but are not paid for under existing rules. Closing that gap matters as planners confront evolving toronto electricity needs alongside province-wide growth.

To address both timing and financeability, ESC proposes a Distributed Reliability Track that would offer 8 to 10 year standard-offer contracts for 100 MW to 500 MW of distributed BESS. The model is designed to procure assets that can be online within 12 to 24 months, reduce costs for ratepayers compared with more centralized procurements, and provide the revenue certainty needed to mobilize private capital. It is also framed as a bridge strategy for the 2026 to 2032 window, complementing long-term generation and transmission investments while planning for toronto demand future scenarios across key load centers.

Operational data from Ontario sites, the report notes, indicates batteries can respond within seconds and handle a wider stack of grid-support functions than current market design allows. Stakeholders argue that a clear, bankable program would immediately activate capacity already connected to the grid, improve utilization, and de-risk new project pipelines, momentum that aligns with cross-provincial efforts such as bc accellerates clean energy shift initiatives that underline the pace of clean power deployment.

Overall, the proposal seeks to translate policy intent into near-term reliability outcomes: valuing distributed storage as infrastructure, compensating measurable services beyond peak shaving, and contracting capacity through standardized offers that can scale quickly. In ESCs view, that would bridge Ontarios immediate capacity gap while complementing the provinces multi-year procurement and build-out plans.

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