This bulletin was updated on November 21, 2025.
This is the latest on the Independent Electricity System Operator (IESO) Long Lead-Time Request for Proposals (LLT RFP). The LLT RFP aims to address growing demand in Ontario’s electricity sector by securing energy and capacity resources with longer lead times for project development.
Background
The IESO began engaging with stakeholders on the design of the LLT RFP in April 2025, following the issuance of the Long Lead-Time Request for Information (LLT RFI) in 2024. The IESO submitted the LLT RFI results to the Ministry of Energy (Ministry) on August 29, 2025.
Eligibility
The LLT RFP is a reliability-based procurement intended to secure incremental energy and capacity from new-build resources with a lead time of five or more years that will contribute to system needs over a 40-year term.
The LLT RFP will be bifurcated into an energy stream (LLT(e)) of up to 1 TWh and a capacity stream (LLT(c)) of 600 MW to 800 MW. Both streams will be administered in a single procurement window.
Reservoir hydro with storage capability (other than pumped hydro) will be eligible only for the energy stream. Long-duration energy storage (LDES) resources (including pumped hydro storage and compressed air energy storage) will be eligible only for the capacity stream.
The IESO is proposing to introduce LLT(c) eligibility for other emerging technologies, such as liquid air energy storage and pumped thermal energy storage, but only to a maximum of 200 MW and may be subject to additional submission requirements. Despite the new-build eligibility requirement, the IESO is proposing to preclude LLT RFP eligibility for hydro redevelopments and instead encourages such projects to participate in the LT2 RFP.
The IESO is proposing that LLT(c) resources have a minimum nameplate capacity of 10 MW to 50 MW and a minimum duration of 8 hours.
The IESO is currently proposing that LLT(c) project proponents must have at least two team members with experience in:
i) planning and developing a Same Technology Qualifying Project (i.e., using the same storage technology and coming into commercial operation within the last 10 years); and with
ii) financing, constructing and operating at least one “Qualifying Project” (i.e., nameplate capacity of at least 1 MW that achieved commercial operation in the last 15 years). The IESO has expanded the definition of “Qualifying Projects” for the LLT RFP beyond North America to include projects that have reached commercial operation in Japan, Australia and parts of Europe (U.K., Italy and France).
The IESO is proposing that LLT(e) project proponents have at least two team members with collective experience in planning, developing, financing, constructing and operating a Same Technology Qualifying Project (i.e., a hydroelectric generation facility with a nameplate capacity of at least 1 MW that has achieved commercial operation in Canada or the United States within the last 15 years).
Rated Criteria
Rated criteria will be finalized by the Ministry in a future directive. For now:
- The IESO is considering adding a mandatory requirement or rated criteria for the installation of equipment to provide regulation services in the future. Under the LLT(e), this requirement is generally being considered for hydro facilities with a maximum contract capacity greater than 20 MW.
- The IESO expects a similar rated criteria approach for Indigenous community participation (i.e., more points can be obtained where the project involves Indigenous equity participation, and even more where the project is located on traditional Indigenous territories). The IESO is awaiting formal policy direction from the Ministry on this.
Contract Provisions
The IESO expects to incorporate similar must-offer obligations and planned outage provisions in the LLT(c) as contained in the LT2 contracts, except that Qualifying Hours may include additional hours on weekends and holidays. The IESO is also considering introducing real-time (RT) Must Offer requirements.
The IESO has reduced the Reimbursement Reference Efficiency (RRE) included in the calculation of the Regulatory Charge Credit for the LLT(c) from 75% to 60% to reflect lower expected round-trip efficiency.
For LLT(e) contracts, the IESO recommends that proponents incorporate planned outages in their imputed production factors to avoid availability non-performance charges. For capacity stream contracts, planned outages will similarly be considered as part of the calculation for availability non-performance charges. However, the IESO is permitting one long-term outage of the contract term up to a maximum of 12 months.
The same environmental attributes regime as in the LT2 contracts (i.e., supplier benefits from revenue) is proposed for the first half of the 40-year contract. The IESO is proposing a revenue-sharing mechanism between the supplier and the IESO for the last 20 years of the LLT contract term.
Notably, the IESO is considering a two-way termination provision exercisable up to two to three years following the LLT contract date. If the termination provision is exercised by the IESO, there will be a return of all of the completion and performance security to the supplier as well as a fixed payment to cover a portion of the supplier’s development costs incurred. The IESO is considering the inclusion of specific reasons for which both the IESO or supplier can terminate a LLT contract, the date on which the optional termination would lapse, the appropriate termination payment that should apply where the IESO terminates or the supplier exercises optional termination, and how a supplier-elected termination may impact its ability to participate in future IESO procurements.
Other items continue to remain in flux, including early in-service provisions, the rolling average period over which non-performance charges will be determined, and an applicable escalation mechanism.
Next Steps
Drafts of the LLT RFPs and Contracts can be found here.
The IESO is offering early deliverability discussions with LLT RFP proponents between December 2025 and January 2026 and will issue deliverability guidance to proponents in Q2/Q3 2026. LLT proposal submissions are estimated to be due in Q4 2026 with LLT contracts to be awarded in Q1/Q2 2027.
Stakeholders are invited to submit written feedback to the IESO by December 3, 2025.
Our team is closely monitoring developments related to the LLT RFP and will provide updates when more details are available.
For more information, please contact the authors or any other member of our Energy Regulatory or Power groups.
