Why Canada is betting big on battery storage

Canada had 552 MW of grid-connected storage projects larger than 1 MW at the end of 2024. In a July 2025 snapshot, the Canada Energy Regulator said projects already under construction could lift that to 1,149 MW by 2030. If every approved project goes ahead, the figure could reach 2,768 MW. Batteries are the country’s fastest-growing storage technology, and every project then under construction used batteries.¹

Even that national figure does not show how quickly the next wave is arriving. By September 2026, six reported front-of-meter battery plants in Ontario, Oneida, Napanee, Hagersville, Sanjgon, York and Goreway, added up to about 1,050 MW. This is our total from named projects. No official national total is available for comparison. It does not include batteries behind the meter, Alberta’s merchant fleet or smaller systems.

Batteries now do much more than support renewables. They are becoming system capacity. They can react in fractions of a second, store power when it is cheap and release it when it is valuable, provide operating reserves and sometimes delay new grid investment. Ontario buys these services through long-term contracts. Alberta relies more on merchant revenues and grid-support services.

The market is moving fast

Industry forecasts are higher. CanREA expects 12 to 16 GW of new energy storage by 2035, part of a wider CA$205 billion opportunity in wind, solar and storage.¹⁴ Energy Storage Canada says the country needs 8 to 12 GW to support its net-zero goals.¹⁵ Grand View Research, a commercial forecaster, expects Canadian BESS revenue to rise from US$586.8 million in 2024 to US$2.9 billion in 2030, a 31.7% CAGR.¹⁶

Why batteries are growing

The federal Clean Electricity Regulations were finalized in December 2024. They aim for a net-zero electricity system by 2050 and bring in an emissions standard for larger fossil-fuel generators through the 2030s. Federal strategy documents say the rules should encourage investment in non-emitting resources, including batteries.¹² Provinces do not agree on the policy. Alberta publicly rejected an earlier draft. That means investors still need to study the rules in each province.

Ontario leads the way

Ontario has run several rounds of battery contracts. This has built a large project pipeline and shown the market what storage capacity is worth. Newer rounds also call for batteries that can run longer and projects with more Indigenous ownership.

More competition has pushed prices down. The reported average winning price fell from CA$881.09/MW in E-LT1 to CA$672.32/MW in LT1, a drop of 24%.⁴⁶ LT2 capacity prices were reported at 36% below E-LT1 and 16% below LT1. Its three winning projects will use eight-hour batteries, have 20-year contracts and must be in service by 1 May 2030.⁷ Next comes the Long Lead-Time RFP. It targets up to 800 MW of long-duration storage under 40-year contracts.³

Local support and Indigenous ownership now matter in the bidding process. All three LT2 winners had municipal backing and at least 50% First Nations equity.⁷ Oneida, Hagersville, Skyview 2 and Nova Scotia’s three-site program also have Indigenous partners. In Canada, these partnerships are becoming an important part of whether a project can get financed and built.

Projects to watch

Two ways to earn revenue

Oneida earns money in three ways. It receives a fixed capacity payment under its IESO agreement, sells energy into the wholesale market and provides operating reserves and other grid services.⁵ Alberta’s eReserve fleet earns money by responding to the AESO market, where speed and changing prices matter more. Investors should not treat every Canadian storage project the same. Contract length, dispatch rights, local grid limits and competition for grid services all need to be checked province by province.

What could slow things down

Battery prices are falling and contracts are getting easier to finance. The tougher issues are finding suitable sites, connecting projects to the grid, addressing fire-safety concerns, building enough transmission and setting fair rules for smaller batteries.

• Community supportA proposed 4.99 MW LFP project in Armour Township received 1,508 submissions against it and only two in support at a November 2025 meeting. Council rejected the project and the developer appealed. The township later dropped its legal fight after warning that the legal costs could be high.²⁰
• Grid connection delaysWe found no reliable Canada-wide figure for BESS queue delays. This gap matters because an approved project may still take years to connect and begin operating.
• Revenue for smaller systemsOntario had roughly 225 MW of large C&I behind-the-meter batteries in 2023, based on an older estimate. Energy Storage Canada says those systems are still underused. It has proposed an 8 to 10 year standard-offer program for 100 to 500 MW.³
• Trade and supply chainsIESO’s 2025 outlook came before the latest tariff threats, but it still warned about Canada-U.S. trade uncertainty. NextStar Energy’s Windsor plant has shifted from EV cells toward grid and commercial storage, giving Canada another domestic supply option.²²¹
• Longer-lasting batteriesOntario is moving from four-hour systems to eight-hour LT2 projects. It is also planning to buy up to 800 MW of long-duration storage. The technologies that win, and the cost of financing them, will shape the next round of growth.

The next milestones are clear. Skyview 2 and other LT1 projects are due to enter service from 2027. The three eight-hour LT2 projects are due by May 2030, and the first long-duration projects will come from the LLT process. The opportunity through 2035 is much larger, but these projects still have to be financed, connected and built.

The bottom line: Canada is investing in batteries because they solve several grid problems. They can cover capacity gaps, support variable generation, respond faster than thermal plants and earn money from several grid services. Low-cost cells alone will not decide which projects succeed. Developers also need a grid connection, lasting local support, strong Indigenous partnerships and a revenue model that fits the province.