January 2017
Backgrounder

ROMA, along with northern and rural communities across Ontario have been advocating for the expansion of natural gas to more of their communities. This is because natural gas is significantly less expensive than oil heating or electricity, which has been rising in price exponentially. The result has been increased costs for municipal governments, businesses and residents, which reduces quality of life and economic growth.

Both major trunk lines and distribution lines need to be built to deliver natural gas to smaller communities. The expansion of these services has to be managed carefully, however. The following principles, developed with extensive municipal input, have been the foundation of ROMA’s advocacy on energy matters:
  • Projects should anticipate and address environmental matters in its construction;
  • Public health and safety must be a top priority, with careful planning and ongoing maintenance to prevent potential for a line breach. As well, utilities must ensure that staff and equipment are nearby to respond quickly to any incident.
  • Projects should promote economic development beyond construction.

Natural Gas in Ontario
While there is some natural gas production in Ontario, for the most part natural gas is imported from the U.S. and other parts of Canada through pipelines. The price of natural gas has dropped to under a third of what it was in 2008.  This is primarily the result of increased production based on shale and fracking technologies.

Ontario has largely been divided into two territories that are served by two natural gas companies.  More new companies may make bids for territory as renewable natural gas ventures become more popular.  

The Ontario Energy Board (OEB) governs many matters related to energy rates and expansions. Municipal governments will need to be prepared to work with the OEB, gas companies and their communities to bring gas lines into their communities.  

Municipal Fiscal Matters
Municipal governments need an expansion program that offers a variety of financing scenarios that reflect the fiscal realities of different communities. Not all local governments have the same resources to participate financially. For nearly half of all Ontario municipalities, a 1% tax increase raises only $50,000.  

It is in everyone’s best interest that expansions include investment by gas companies, in addition to any support from municipal governments and the Province, and what is recouped from ratepayers.