Ontario’s electricity system is entering a period of profound transformation. Electrification is accelerating, supported by government policy, and demand on the electrical grid is rising. To meet the challenges of this period of profound transformation, innovation is essential. As new technologies emerge, OSPE urges regulators and planning bodies to embrace innovation.
This January, OSPE wrote to the Minister of Energy, the Chair of the Independent Electricity System Operator (IESO), and the Chair of the Ontario Energy Board (OEB) to advocate for strengthening Ontario’s Grid Innovation Fund (GIF). Our letter outlines recommendations to ensure the Fund delivers value to stakeholders in Ontario’s evolving energy landscape.
The GIF provides funding to specific projects that aim to reduce electricity bills or help consumers manage their consumption. Members of OSPE’s Energy Task Force identified the opportunity for the Fund to further promote innovation and maximize benefits for Ontario ratepayers.
OSPE Recommendations
Ontario has a strong foundation in energy innovation, but the scale and complexity of the challenges ahead need a deliberate and forward-looking approach.
Strengthening the GIF can help Ontario de-risk emerging technologies, validate new business models, and support the growth of homegrown companies. To fully realize this potential, the Fund must evolve to increase flexibility, transparency, accessibility, and strategic alignment.
OSPE recommendations, informed by the insights of our Energy Task Force members, calls for:
More flexible and adaptive funding: Innovation moves quickly. Rolling intakes and targeted calls would allow the Fund to respond to emerging needs while minimizing delays.
Technology-neutral evaluation: Funding should prioritize outcomes like cost savings, reliability, and emission reduction to allow a variety of solutions to compete.
Clear pathways from pilot to commercialization: Tiered funding streams can help initiatives go from a pilot project to market deployment.
Strong support for business formation and scale-up: Innovation succeeds when strong ideas are paired with viable business models, real-world testing, and partnerships.
Improved accessibility: Municipalities, Indigenous communities, and small businesses should be encouraged to bring forward solutions. Dedicated funding streams would broaden their participation and their solution’s impact.
Better performance measurement and knowledge sharing: Innovation can deliver the most value when lessons learned are shared; standardized metrics and transparent reporting can support learning across initiatives.
Clearer governance and strategic guidance: A formal advisory committee with diverse representation can strengthen decision-making, transparency, and trust in the Fund and its solutions.
Alignment with long-term system planning: Innovation funding should reinforce Ontario’s broader electrification, decarbonization, and reliability goals.
Modernized governance structures: Clear roles and accountability in the Fund’s governance would increase public trust and the Fund’s adaptability to change.
Are We Investing Enough in Innovation?
Ontario currently invests approximately $9.5 million annually in the Grid Innovation Fund, alongside other targeted innovation programs. Increasing funding reflects the value of innovation.
Innovation in our electricity system will improve its resilience, mitigate climate impacts, and create new businesses and jobs. OSPE encourages consideration of alternative funding approaches (such as modest, system-wide levies) to align innovation investment with its societal value.
Strengthening the Grid Innovation Fund is a strategic opportunity to ensure Ontario innovation can support this period of transformation. To make sure engineering voices are heard as Ontario builds an electricity system fit for the future, OSPE will continue to engage with decision makers and bring forward engineering solutions.
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