Item - 2021.EX28.1

City Council considered Items EX28.1 and IE26.16 together.

The Executive Committee recommends that:   

1. City Council as shareholder request Toronto Hydro Corporation, the Deputy City Manager, Infrastructure and Development Services and the Deputy City Manager, Corporate Services, to continue a collaborative analysis of the Toronto Hydro Climate Action Plan and relevant City strategies and programs to determine specific goals, outcomes, actions and timelines for enabling Toronto’s net zero climate targets, including consideration of the recommendations contained in the letter (December 6, 2021) from Councillor Mike Layton.

2. City Council request the Deputy City Manager, Infrastructure and Development Services and the Deputy City Manager, Corporate Services, and relevant divisions, agencies and stakeholders, in collaboration with Toronto Hydro, to refine the TransformTO spatial and temporal study of climate actions to include probabilistic adoption scenarios (for example, electric vehicles and heat pumps), resulting in corresponding electricity consumption and demand profiles.

3.  City Council direct the City Manager to report to City Council by the end of the second quarter of 2022 with respect to the analysis referred to in Part 1 above and the consultation and climate adoption scenarios referred to in Part 2 above, including possible implementation plans starting as early as 2022, and any recommendations regarding new climate action mandates such as a shareholder direction for Toronto Hydro.

4. City Council direct that Confidential Attachment 3 to the report (November 23, 2021) from the City Manager remain confidential in its entirety, in accordance with Section 4.4 of the Toronto Hydro Shareholder Direction, as it contains technical, commercial, financial or labour relations information of Toronto Hydro Corporation.

At City Council's request from its April 7, 2021 meeting, Toronto Hydro Corporation has submitted a report to the City Manager on its current climate action work and opportunities in key areas including electric vehicles, outdoor lighting, renewable energy, energy storage and non-capital sources of revenue.  

This report responds to further Council direction that the City Manager report on Toronto Hydro's plan and the role Toronto Hydro has in enabling the City's climate change and equity objectives.

Accelerating climate action is essential for the health and prosperity of Toronto and requires all City divisions, agencies and corporations to advance this work.  Toronto Hydro, as the City's wholly-owned electrical distribution company, is a critical enabler of many of the City's climate goals outlined in TransformTO and the staff-recommended Net Zero Strategy, given the significant greenhouse gas (GHG) reductions that can be realized through electrification to displace fossil fuel use in buildings and vehicles. 

Toronto Hydro's Climate Action Plan (attached to this report with a cover letter and confidential appendix) offers a positive framework to enable the electrification necessary to achieve net zero emissions. It proposes opportunities that include:

- expanding regulated electricity distribution to build a grid that is capable of supporting Toronto’s future zero-emission electricity demand;  
- creating a new, unregulated “Climate Advisory Services” business to facilitate the growth of emerging local clean-tech markets; and 
- making capital investments, focused on modernization of outdoor lighting. 
 

Toronto Hydro submitted its Climate Action Plan to the City Manager on September 30, 2021. City staff have begun reviewing the framework with Hydro, divisions and agencies to determine alignment with the TransformTO Net Zero Strategy and other strategies and programs such as City-run climate advisory services, electric vehicles, and street lighting. Further review of financial, economic, environmental, regulatory and timing risks and opportunities is required. Thorough analysis and due diligence will enable City and Toronto Hydro staff to provide recommendations to City Council and the Toronto Hydro Board regarding any new mandates or shareholder direction to Toronto Hydro, City-funded investments, partnerships and other actions. 

The City and Toronto Hydro will continue to collaborate on research and to consider specific investments, programs, policies and other measures to advance the objectives of the Climate Action Plan and a coordinated City-Hydro climate response. This report recommends consideration of specific priority areas and reporting back to Council in Q2 2022 on next steps.