Battery storage
What Ontario’s battery procurement means for electricity planning
Ontario’s latest capacity procurement offers a Canadian market benchmark for storage, with an important distinction between capacity payments and equipment costs.
Originally published on LinkedIn. This article reflects the information and perspective at the time of the original post.
Ontario’s June 2026 LT2 capacity procurement selected three battery storage projects totalling 640 MW. The weighted average fixed capacity payment was $563.48 per MW-business day, and all three projects reported 50% Indigenous participation.
The result continues the downward trend highlighted in my original post: approximately $881 per MW-business day in the 2023 E-LT1 procurement, $672 in the 2024 LT1 procurement and $563 in the 2026 LT2 capacity round.
Correction to the original post: LT2 required at least eight hours of duration. The earlier reference to this being another four-hour storage result was incorrect. Different duration requirements and contract terms mean these procurements are not a like-for-like comparison.
These figures are contracted capacity payments, not battery equipment prices or the full cost of delivered electricity. They nevertheless provide useful Canadian market evidence for utilities and regulators reviewing storage assumptions in long-term resource plans.
For Nova Scotia, the lesson is to test planning assumptions against recent competitive results while accounting for differences in duration, operating requirements, location and contract structure.
IESO procurement results: https://ieso.ca/-/media/Files/IESO/Document-Library/long-term-rfp/capacity/LT2c-1-20260611-Public-Result-Table.pdf (opens in a new tab)
IESO duration requirements: https://www.ieso.ca/-/media/Files/IESO/Document-Library/long-term-rfp/capacity/LT2c-1-20250911-Contract-Consolidated-with-Addendum-1-and-2.pdf (opens in a new tab)
