Enbridge wins relief from $1.5-million electrification direction, but gas incentives stay rejected

Enbridge Gas won a partial change to the rules for its Southern Lake Huron energy-planning pilot, but failed to overturn the rejection of incentives for advanced natural gas equipment.

In its May 14, 2026 decision in Enbridge Gas Inc., EB-2025-0333, the Ontario Energy Board removed a requirement to redirect $1.5 million from the rejected gas technologies to electrification measures. It also removed a direction to consult on a second pilot within that proceeding.

The result was not a finding that the original panel had made an error. Nor did it establish a general ban on gas technologies in future energy-planning projects. The board instead distinguished the evidence supporting this particular pilot from broader policy questions and the practical need to bring a lengthy proceeding to an end.

Testing alternatives to more pipeline infrastructure

Integrated resource planning examines ways to meet a gas system’s needs without necessarily building traditional pipeline infrastructure. Measures can include reducing demand through efficiency improvements, changing when customers use energy, or using alternative technologies.

Enbridge originally applied in July 2023 for two pilot projects. After delays and revisions, one was withdrawn and the remaining Southern Lake Huron proposal focused on Sarnia and Point Edward.

The proposed budget was $14.2 million. The plan included energy-efficiency and demand-response measures, limited use of electric heat pumps and advanced technologies such as hybrid heating, gas heat pumps and thermal energy storage.

In March 2025, the board approved the pilot with changes. It rejected incentives for natural gas equipment and directed Enbridge to shift $1.5 million to electrification measures instead.

The board initially started its own review of that decision, then decided in December 2025 not to proceed with it. Enbridge filed its review motion later that month. In March 2026, the board found the issues sufficiently material to warrant review and temporarily stayed the contested portions pending its merits decision.

Gas incentives still rejected

Enbridge argued that the original decision exceeded the issues before the panel, lacked evidentiary support, was procedurally unfair and conflicted with provincial energy policy. It also said the decision improperly excluded a future role for gas technologies.

The board rejected that broad reading. The original proceeding concerned approval of one pilot, not establishment or revision of the entire planning framework. Future panels were not formally bound by it.

The suitability of the proposed alternatives was expressly on the issues list, and Enbridge had anticipated opposition to gas heat pumps. The panel was entitled to approve or reject the individual technologies proposed.

The board also accepted that the record contained undisputed evidence that the gas-fired solutions were more expensive than comparable electric technologies. It found no error in refusing those incentives on the evidence presented.

Enbridge relied in part on Ontario’s June 2025 energy plan, which emphasized the continuing role of natural gas. The board acknowledged that policy but noted that the plan also supported efficiency and electrification. It was not persuaded that the later policy document would have justified incentives for technology previously found to be more costly and less mature.

The ruling did not eliminate gas solutions from consideration in other projects. Broader questions belonged in the framework review or future applications.

Budget direction removed for practical reasons

Although the board upheld the rejection of gas incentives, it did not insist that Enbridge redirect the associated funding to electric alternatives.

By then, the pilot application was almost three years old. Enbridge had assured the board that other offerings were being implemented, including electrification measures at the limited participation levels originally proposed.

The board concluded that adding the disputed budget reallocation at that stage would not efficiently advance completion of the pilot. It relied on its procedural obligation to resolve matters justly and efficiently, rather than finding an error in the original decision.

The separate direction to consult the board’s technical working group about a second pilot was also removed from this proceeding. The board considered parallel discussions inefficient while broader framework questions were being addressed.

That change did not release Enbridge from the 2021 framework’s expectation that it develop and implement two pilots. The board expressly preserved that distinction, directing questions about further projects toward the framework process.

The decision therefore gave Enbridge relief from two implementation directions while leaving the central refusal of gas-equipment incentives in place. It did not authorize the rejected spending or decide that natural gas technologies could never form part of another planning proposal.

In a separate June 25, 2026 costs order, the board directed Enbridge to pay four intervenors a combined $10,887.59. It found their claims reasonable and recorded that Enbridge had not objected.