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ARTICLE · 13 JUNE 2025

OEB Proposes Incentive Framework For Third-Party DERs With Margin On Payments

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The Ontario Energy Board (OEB) is proposing amendments to the Distribution System Code to accelerate the use of third-party distributed energy resources (DERs) as non-wires solutions (NWSs) in Ontario.

CanadaEnergy and Natural Resources
John Vellone
John Vellone
Zoë Thoms
Zoë Thoms
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The proposed changes would allow electricity distributors to earn a Margin on Payments (MoP) of up to 25 per cent of the payments made to DER providers.

The Ontario Energy Board (OEB) is proposing amendments to the Distribution System Code to accelerate the use of third-party distributed energy resources (DERs) as non-wires solutions (NWSs) in Ontario. The proposed changes would allow electricity distributors to earn a Margin on Payments (MoP) of up to 25 per cent of the payments made to DER providers, so long as the projects deliver a net benefit, and the present value of the margin does not exceed half the total projected benefit.

The proposal builds on recent OEB guidance on innovation and DERs as NWSs.1 By formalizing the MoP incentive and setting clear eligibility thresholds, the OEB aims to bring third-party solutions onto a more level footing with traditional infrastructure.2 The goal: to integrate more flexible, cost-effective resources into distribution

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