In an announcement Thursday morning Premier Doug Ford announced that Ontario would open its doors to data centres, but force them to pay a fair rate for the electricity they use.
With the announcement the Ontario government launched a framework for what it is calling a Data Centre Playbook, which will help the province “attract the best data centre investments that drive economic growth, ensure Canadians’ data remains in Canada and deliver significant and meaningful benefits to local communities,” a press release from the government said.
“This framework will also ensure data centres pay the full cost of electricity, with the government only offering non-financial support to attract investments. As part of the government’s plan to protect Ontario and build the most competitive economy in the G7, this Playbook is an early initiative and key enabler of the province’s forthcoming artificial intelligence (AI) strategy to leverage the economic opportunities AI adoption will bring, including generating $122 billion in economic growth by 2035 and creating more than 17,000 new jobs every year.”
Ford said he believes that if the province doesn’t get on board it will be left behind.
“Ontario has a choice: we can build the economy of the future and ensure Canadians’ data remains in Canada, or we can get left behind and risk Canadians’ data being sent to the U.S. and elsewhere,” the premier said.
“Through our new Data Centre Playbook, our government is choosing to build the economy of the future to generate billions in economic growth and create thousands of new jobs, while ensuring new data centres play by the right rules and pay the full cost of electricity. Any data centre investment will need to invest significantly in local communities and pay more for electricity so no energy costs are passed on to hardworking families.”
According to the release, the government will control which companies can access the power grid.
“As part of the Protect Ontario by Securing Affordable Energy for Generations Act, the Ontario government enacted new authorities that will give the Minister of Energy and Mines the final decision on which large-load facilities are permitted to connect to the province’s electricity grid, including data centres. With these enhanced authorities in place, Ontario’s Data Centre Playbook will only consider projects that accelerate economic growth with significant community investments, on terms that prioritize Ontario’s interests.”
Minister of Energy and Mines Stephen Lecce said the province is adding a new rate for the high-energy use facilities
“We have designed a system that protects families and ensures data centres pay for complete cost of power — every single cent,” Lecce said.
“To make this point, Ontario will be introducing a new higher electricity rate for data centres, in addition to prioritization for projects that generate their own power. While we work to attract investment and store Canadian data on Canadian soil, we have strong guidelines that safeguard families every step of the way.”
The province’s Playbook is anchored in three pillars to guide approvals for new data centres:
- Advance economic development: projects that bring in significant investment, job creation and new tax revenue for the province and municipalities, support Ontario and Canada’s domestic supply chains and help businesses be more productive.
- Protect data security and digital sovereignty: projects that can advance Ontario and Canada’s digital sovereignty to protect critical data and safeguard people’s information. Canadians’ data will stay in Canada.
- Invest in communities and earn public confidence: projects that bring real benefits to local communities, significantly investing both financially and non-financially in host communities to drive local infrastructure developments, job creation and training, and future economic growth.
Minister of Public and Business Service Delivery and Procurement Stephen Crawford says the Playbook is an important aspect of moving forward.
“The Data Centre Playbook is another important step in strengthening Ontario’s position as a global technology leader,” he said. “It builds on our work to strengthen digital trust and protect data security, while attracting the investments that will help drive Ontario’s future growth.”
The release also notes that the province will not be giving financial incentives to potential data centres.
“The province will only offer non-financial support to attract data centre investments, leveraging Ontario’s existing strategic advantages such as a clean and reliable electricity system, ample land space, cool climate and skilled workforce. Data centres will also pay for the cost of their impact on the electricity system, ensuring people’s electricity bills are not increased. This will include proposed measures to address data centres’ impact on the electricity system by encouraging projects to build their own power generation and by establishing a separate rate class for large new data centres. Under this proposal, new data centres above 1 megawatt (MW) in size would pay a higher rate than the industrial rate program for large electricity users. With more modern data centre technology available today than there was decades ago, Ontario will only advance data centre projects that meet Ontario’s strict environmental standards around water consumption and noise, prioritizing projects with closed-loop systems that use virtually no water during operation.”
“As demand for digital infrastructure continues to grow at an unprecedented pace, our government is taking bold action to ensure Ontario’s interests remain protected and prioritized,” said Vic Fedeli, Minister of Economic Development, Job Creation and Trade.
“The Data Centre Playbook will serve as a strategic assessment tool, ensuring that projects looking to break ground in Ontario offer significant economic, security and community benefits.”
While the release does not say anything about regulating the water use of data centres, it does note that there is a 30-day public comment period beginning today with the Environmental Registry of Ontario and the Ontario Regulatory Registry.
“The government is seeking public input through the Environmental Registry of Ontario (ERO) and the Ontario Regulatory Registry (ORR) for a 30-day public comment period beginning August 13, 2026. Input received through the consultation will help refine the proposed draft framework before the Ontario government releases the final Data Centre Playbook to support the broader upcoming AI Industrial Strategy that will lay a foundation to attract investment, support workers, protect intellectual property and build critical infrastructure.”
