Hydro One is Ontario’s largest electricity distributor, serving approximately 1.5 million customers across rural, suburban, and remote areas of the province — a territory that covers about 75% of Ontario’s landmass. For solar installers working outside the major urban centres, Hydro One is the utility you will encounter on most residential and small commercial net metering projects. The program is governed by Ontario Regulation 541/05 under the Ontario Energy Board Act, 1998, which sets standardized net metering rules for every Local Distribution Company (LDC) in the province. This guide covers the Hydro One application process, ESA permit requirements, technical standards, credit mechanics, and how the program compares across Ontario’s major utilities.
Critical Compliance Rule: Do Not Energize Before the Bidirectional Meter Is Installed
Hydro One’s standard meters are not designed to track export. If you commission a net-metered system before Hydro One replaces the meter with a bidirectional unit, the meter will continue to charge the customer for electricity they are actually exporting. Hydro One must install the bidirectional meter before the system exports any power. This sequence — ESA inspection first, then bidirectional meter installation, then system energization — is mandatory.
Ontario Net Metering Framework
Ontario’s net metering program is established by Ontario Regulation 541/05, made under the Ontario Energy Board Act, 1998. The regulation applies to every licensed electricity distributor in the province — not just Hydro One — which means the fundamental program rules are the same whether your customer is in Hydro One territory, Toronto Hydro’s service area, or a small municipal utility like Renfrew Hydro.
Who Is Eligible
A customer is eligible for net metering if they generate electricity from a renewable energy source primarily for their own use. Eligible renewable sources under the regulation include:
- Solar photovoltaic (PV)
- Wind
- Waterpower
- Agricultural biomass
Customers with energy storage systems (batteries) can also participate, provided the storage is paired with an eligible renewable generation source. The generator must be located at the same premise as the customer’s electricity account.
System Size and Classification
Ontario Regulation 541/05 allows net metering for systems up to 500 kW. Within that ceiling, utilities apply their own application tiers:
| System Capacity | Classification | Hydro One Form | Process Complexity |
|---|---|---|---|
| Up to 10 kW | Micro-generation | Form C | Simplified — no CIA required |
| Above 10 kW to 500 kW | Small/Medium generation | Form B (CIA) | Full Connection Impact Assessment |
| Above 500 kW | Not eligible for net metering | N/A | Must use other program streams |
The 10 kW micro-generation threshold is the dividing line for most residential solar installations. A typical Ontario residential rooftop system runs 8–12 kW, meaning systems at the upper end of that range require the more involved Form B CIA process.
Credit Rate Structure
Credits are calculated on a 1:1 kilowatt-hour basis at the same electricity rate the customer pays — not at a wholesale rate and not at a separate export tariff. For customers on Hydro One’s Regulated Price Plan (RPP), this means credits are valued at the applicable RPP electricity rate (Time-of-Use, Tiered, or Ultra-Low Overnight depending on the customer’s rate selection).
What credits can offset:
- Electricity commodity charges
- Variable delivery charges: Distribution Volume Charge, Transmission Rates, variable Rate Riders, Line Losses
What credits cannot offset:
- Fixed monthly charges (Monthly Service Charge)
- Smart Meter Entity Charge
- Fixed Rate Riders
- Standard Supply Service Charge
In practice, the charges credits cannot offset represent roughly 40–50% of a typical Ontario residential electricity bill. Net metering does not make the entire bill go away, but it can substantially reduce the variable portion.
Annual True-Up and Credit Expiry
Credits accumulate month by month. In months when the solar system generates more than the customer consumes, the surplus appears as a “Generation Credit Balance” that carries forward on the next bill. The credits roll forward for up to 12 consecutive months. Under Section 8(8) of Ontario Regulation 541/05, any credits still outstanding after 12 months are reset to zero — there is no cash payout and no credit transfer.
This rule has a direct implication for system sizing: a system that generates significantly more electricity than the customer uses annually will produce credits that expire each year. The optimal sizing target is annual generation equal to annual consumption, not annual generation equal to peak summer output.
Pro Tip: Use Annual Bill Consumption, Not Monthly Peak
When sizing for a Hydro One net metering customer, pull 12 months of consumption data from their Hydro One bill. Size the system to offset annual kWh consumption, not summer peak consumption. Oversizing creates credits that expire every October or November when carryover hits the 12-month mark.
Hydro One’s Service Territory and Network
Hydro One’s distribution network is unlike the urban utilities in Ontario. It serves:
- Rural communities and agricultural areas across central, eastern, and northern Ontario
- Small towns where no municipal utility exists
- Remote and isolated communities (some served by Hydro One Remote Communities subsidiary)
- Cottage country regions (Muskoka, Haliburton, Kawartha Lakes, Parry Sound)
This geography creates practical differences from urban utilities. Hydro One’s distribution lines are often longer, transformers are sized for lower loads, and grid capacity on any given feeder can be limited. For solar systems above 10 kW, Hydro One’s CIA process assesses whether the local feeder and transformer can absorb additional generation. In some cases, the existing transformer may need upgrading — a cost that can be passed to the generator applicant.
Before purchasing equipment for a system above 10 kW, contact Hydro One’s Distributed Connections Group to ask about feeder capacity at the project address. This is also good practice for larger residential systems (8–10 kW) in areas with known capacity constraints.
Distributed Connections Group:
- Email: DxGenerationConnections@HydroOne.com
- Phone: 1-877-447-4412
Ontario LDC Comparison
All Ontario LDCs operate under Ontario Regulation 541/05, so the credit mechanics, eligible sources, and 12-month carryover rule are identical. The differences are in application logistics, CIA fee schedules, and internal processing timelines.
| Feature | Hydro One | Toronto Hydro | Hydro Ottawa | London Hydro |
|---|---|---|---|---|
| Governing regulation | O. Reg. 541/05 | O. Reg. 541/05 | O. Reg. 541/05 | O. Reg. 541/05 |
| Micro-generation threshold | 10 kW | 10 kW | 10 kW | 10 kW |
| Max system size | 500 kW | 500 kW | 500 kW | 500 kW |
| Credit rate | 1:1 RPP rate | 1:1 RPP rate | 1:1 RPP rate | 1:1 RPP rate |
| Credit carryover | 12 months | 12 months | 12 months | 12 months |
| Micro-gen application | Form C (online portal) | Online portal | MyAccount portal | Online application |
| CIA fee (simplified) | $2,321.48 (incl. HST) | Contact utility | Contact utility | $500 |
| Application email | DxGenerationConnections@HydroOne.com | der@torontohydro.com | hydroottawa.com | generation@londonhydro.com |
| Territory | Rural/suburban Ontario | City of Toronto | Ottawa area | London area |
Key Difference: CIA Fee Schedules
Hydro One’s CIA fees are published and standardized. London Hydro offers a simplified CIA pathway at $500 for eligible 10–100 kW systems. Toronto Hydro and Hydro Ottawa do not publish fixed CIA fees publicly — contact the utility’s distributed energy resources team for project-specific quotes before committing to a commercial system design.
Technical Requirements for Solar Connection
Inverter Certification
Inverters connected to Hydro One’s distribution system must meet Canadian interconnection standards. Hydro One’s Technical Interconnection Requirements (TIR) reference CAN/CSA C22.3 No. 9 (Interconnection of Distributed Resources and Electricity Supply Systems). In practice, this means:
- Inverters must carry CSA or UL certification to applicable Canadian standards
- Micro-generation inverters must include anti-islanding protection (automatic disconnection on grid loss)
- Voltage and frequency ride-through settings must comply with CAN/CSA C22.3 No. 9
Verify that your chosen inverter model meets Canadian interconnection requirements before submitting the Form C application. Most major inverter brands sold in Canada (Enphase, SolarEdge, Fronius, Huawei, Sungrow) carry the required certifications, but confirm with the manufacturer.
Bidirectional Meter
Hydro One installs a bidirectional smart meter at no charge for residential Form C micro-generation projects. The bidirectional meter:
- Records energy imported from the grid (normal consumption)
- Records energy exported to the grid (surplus generation)
- Supports Time-of-Use metering
For systems above 10 kW, additional metering requirements may apply and metering costs may be part of the connection agreement.
Protection Relay Requirements
Hydro One requires that distributed generation systems include protection functions consistent with CAN/CSA C22.3 No. 9:
- Over/under voltage protection
- Over/under frequency protection
- Anti-islanding protection
- Reconnection delay after grid restoration (typically 5 minutes minimum)
Modern grid-tie inverters with Canadian certification include these protection functions as built-in features. The inverter datasheet should confirm compliance — include this documentation with the Form C or Form B submission.
Ontario Electrical Safety Code (OESC) Requirements
Solar PV systems in Ontario must comply with the Ontario Electrical Safety Code (OESC), 28th Edition (2021), which came into effect May 5, 2022. Section 64 of the OESC covers renewable energy systems including solar PV, addressing:
- String and combiner wiring: Rule 64-222 requires a disconnect for combiners and recombiners
- Generator disconnecting means: Marking requirements at the PV output circuit under Rule 64-200
- Rapid shutdown: Requirements for rapid shutdown of PV systems on buildings
- Arc fault circuit protection: AFCI requirements for specific PV circuit configurations
- Grounding and bonding: Specific bonding requirements for PV arrays and racking systems
- Labeling: ESA Bulletin 64-5-4 (May 2025) sets current labeling requirements for PV systems, including disconnect strategy documentation
ESA publishes interpretive bulletins for Section 64 at esasafe.com — these are mandatory reading for any installer unfamiliar with recent OESC amendments.
Step-by-Step: Hydro One Net Metering Application
Pre-Application Consultation
Before purchasing equipment, contact Hydro One’s Distributed Connections Group at DxGenerationConnections@HydroOne.com or 1-877-447-4412. Confirm the project address is not on a restricted feeder, ask about local feeder capacity (especially for systems 7 kW and above), and request Hydro One’s current Technical Interconnection Requirements (TIR) document for micro-generation. This call takes 10–15 minutes and can prevent costly design revisions after equipment is ordered.
System Design and Equipment Selection
Use solar design software to model annual generation against the customer’s Hydro One bill consumption data. Size to offset annual kWh, not peak months. Confirm inverter CSA/UL certification for Canadian interconnection. For systems at or below 10 kW, design to stay within the Form C micro-generation threshold if possible. Prepare the single-line diagram showing array configuration, inverter location, main switchboard connection, and interconnection point.
File ESA Notification of Work
The licensed Electrical Contractor on the project must file a Notification of Work with the Electrical Safety Authority at esasafe.com before electrical work begins (or within 48 hours of start). Only licensed Electrical Contractors registered with the ESA can file this notification. Homeowners cannot self-permit solar installations in Ontario. ESA permit fees for solar PV systems received a 25% reduction for systems above 10 kW effective April 1, 2025; general wiring fees increased 2.2%. Confirm the current fee with the ESA at 1-877-372-7233.
Submit Hydro One Form C (Micro-Generation) or Form B (CIA)
For systems 10 kW or below: submit Form C — Micro Generation Connection Application through serviceforms.hydroone.com. Required documents: system specifications, inverter model and certification, single-line diagram, confirmation of ESA notification filing, confirmation of municipal permits (if applicable), and the Net Metering Confirmation of Disclosure (required as of July 1, 2022 for third-party arrangements). For systems above 10 kW: submit Form B with full payment of the CIA fee, a signed Study Agreement, and a single-line diagram stamped by a licensed Ontario Professional Engineer.
Hydro One Technical Review and Interconnection Agreement
Hydro One’s engineering team reviews the application. For Form C micro-generation projects, the full process from application to energization typically takes 4–8 weeks. For Form B CIA applications, Hydro One has 14 business days to confirm whether the application is complete; an incomplete application can be resubmitted within 14 days. After technical approval, Hydro One issues a connection offer and an interconnection agreement. Review and sign the agreement promptly — delays in signing extend the overall timeline.
Install and Pass ESA Inspection
Complete the installation per OESC 28th Edition Section 64 requirements. Do not energize the system. Contact the ESA to schedule an inspection. The ESA inspector checks: wiring compliance, labeling per ESA Bulletin 64-5-4, proper disconnect locations, inverter settings, anti-islanding protection, grounding/bonding, and the Notification of Work documentation. After a passing inspection, ESA issues a Certificate of Inspection.
Bidirectional Meter Installation and System Energization
After ESA inspection passes, notify Hydro One that the system is ready for the bidirectional meter. Hydro One schedules and completes the meter swap at no cost for residential Form C systems. Once the bidirectional meter is confirmed in service, energize the system. Net metering credits begin accumulating with the first billing cycle after energization.
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ESA Permits in Ontario
Who Can Pull an ESA Permit
Only licensed Electrical Contractors registered with the Electrical Safety Authority can file a Notification of Work for solar PV installations in Ontario. This is a legal requirement under the Electricity Act, 1998. Homeowners who attempt to self-install solar PV without a licensed contractor cannot legally self-permit the work in Ontario.
When hiring a subcontractor for the electrical portion of a solar installation, confirm their ESA Electrical Contractor license number before work begins. The ESA license is separate from a general contractor’s license or a building permit.
Filing the ESA Notification
The Notification of Work (commonly called the ESA permit) is filed online at esasafe.com. The contractor selects the appropriate work category for solar PV and provides:
- Project address and account holder information
- Description of work (PV installation, inverter size, AC connection details)
- Estimated start date
The notification must be filed before work begins, or within 48 hours of start. Filing late is a regulatory violation and can complicate the inspection process.
ESA Inspection Process
After installation is complete, the Electrical Contractor contacts the ESA to request an inspection. ESA inspection scheduling varies by region — in areas with high solar installation volumes, inspectors can be booked several weeks out. Build inspection lead time into your project schedule.
What the ESA inspector verifies for solar PV:
- Compliance with OESC 28th Edition, Section 64 (Renewable Energy Systems)
- Correct labeling per ESA Bulletin 64-5-4 (disconnect strategies, array identification)
- Proper conductor sizing, conduit installation, and junction box placement
- Grounding and bonding per OESC requirements
- Inverter installation per manufacturer specifications and OESC rules
- AC disconnect location and accessibility
- Anti-islanding verification (typically reviewed on documentation rather than live test)
A passing inspection results in an ESA Certificate of Inspection. This document confirms electrical code compliance. Keep it on file — Hydro One may request it as part of the bidirectional meter installation process.
2025 ESA Fee Changes
Effective April 1, 2025:
- General wiring notification fees increased 2.2% to reflect inflationary pressures
- ESA permit fees for solar PV systems above 10 kW were reduced 25% — a meaningful change for commercial project economics
For the current solar PV notification fee schedule, download the ESA Wiring Fee Guide from esasafe.com or call the ESA Service Centre at 1-877-372-7233.
Hydro Ottawa and Other LDCs
Same Provincial Rules, Different Portals
Ontario Regulation 541/05 is not optional for Ontario LDCs. Every licensed distributor in the province must offer net metering to eligible customers. The credit mechanics — 1:1 kWh offset, 12-month carryover, credit expiry at zero — are identical whether the project is in Hydro One territory, Hydro Ottawa’s service area in the National Capital Region, Alectra Utilities’ territory in the Greater Toronto and Hamilton area, or any of Ontario’s smaller municipal utilities.
Hydro Ottawa serves the Ottawa area and requires customers to apply through their MyAccount portal or by phone at 613-738-6400. The program follows O. Reg. 541/05, with credits appearing on bills as “Generation Credit Balance.”
Toronto Hydro serves the City of Toronto. Installers must contact Toronto Hydro’s distributed energy resources team before entering third-party agreements (der@torontohydro.com or 416-542-3099). Toronto Hydro’s Grid Capacity Lookup Tool allows pre-application feeder capacity checks.
London Hydro serves the London area and offers a simplified CIA pathway at $500 for eligible 10–100 kW distributed energy resources — lower than Hydro One’s published CIA fee of $2,321.48 (HST inclusive).
Alectra Utilities serves Hamilton, Brampton, Mississauga, Markham, and surrounding communities. Alectra’s connecting generation process is documented at alectrautilities.com.
When the LDC Matters for Project Design
The practical differences between LDCs affect project timelines and upfront costs, not the credit structure:
- CIA fees: Range from $500 (London Hydro simplified) to $2,321+ (Hydro One) for systems above 10 kW
- Feeder capacity: Rural Hydro One feeders are more likely to have capacity constraints than urban Toronto Hydro circuits
- Processing timelines: Urban utilities with online portals often process Form C-equivalent applications faster than rural utility teams handling lower application volumes
- Transformer costs: In Hydro One territory, transformer upgrades for oversized generation can be passed to the installer/customer; less common in urban territories with more robust infrastructure
For installers operating across multiple Ontario LDC territories, solar design software that generates region-appropriate documentation — single-line diagrams, interconnection packages, net metering sizing summaries — reduces the per-project administrative load significantly.
Application Timeline and Fees
| Stage | Activity | Typical Timeline | Cost |
|---|---|---|---|
| Pre-application | Consultation with Hydro One DG team | 1–3 business days (email/call) | Free |
| ESA permit | File Notification of Work | Before or within 48 hours of work start | ESA fee (see fee guide) |
| Form C submission | Submit micro-generation application | 1–2 hours to complete | No Hydro One fee |
| Hydro One technical review | Engineering review and connection offer | 2–4 weeks | No fee (Form C) |
| Interconnection agreement | Review and sign | 1–2 weeks | No fee |
| Installation | Physical installation | 1–3 days (residential) | Installer cost |
| ESA inspection | Schedule and pass inspection | 1–3 weeks (scheduling + inspection) | Part of ESA permit fee |
| Bidirectional meter | Hydro One installs meter | 1–2 weeks after ESA inspection | No charge (residential) |
| Total (Form C) | Application to energization | 4–8 weeks | — |
| Form B CIA fee | Connection Impact Assessment (>10 kW) | 4–12 weeks for CIA + review | $2,321.48 (simplified, HST incl.) |
| CIA (above 30 kW) | Engineering study | 6–16 weeks | $3,762.74–$10,183.37 (HST incl.) |
All CIA fees are as per Hydro One’s published schedule effective January 1, 2022. A 50% fee applies for CIA revisions. Any unspent portion of the CIA fee is refunded if the application is withdrawn before the CIA is completed.
Common Rejection Reasons
| Issue | Why It Causes Rejection | How to Avoid |
|---|---|---|
| Incomplete Form C | Missing inverter certifications, absent SLD, or no ESA notification confirmation | Confirm the checklist in Hydro One’s Form C instructions before submitting |
| Restricted feeder | Local distribution circuit already at maximum generation capacity | Call DxGenerationConnections@HydroOne.com before purchasing equipment |
| System above 10 kW submitted on Form C | Wrong application form — CIA required | Use Form B and submit with Study Agreement and PE-stamped SLD |
| Non-certified inverter | Inverter lacks Canadian CSA/UL certification for grid interconnection | Verify certifications with manufacturer before specifying equipment |
| No ESA Notification of Work | Hydro One requires confirmation that ESA permit is filed | File ESA notification before or immediately after starting electrical work |
| Undersized transformer | Existing transformer cannot accommodate generation output | Pre-consult Hydro One; transformer upgrade may be required and may add cost |
| Missing Net Metering Confirmation of Disclosure | Required since July 1, 2022 for third-party leasing/PPA arrangements | Include OEB’s Confirmation of Disclosure form if a third-party owns the system |
| System not primarily for own use | Commercial-scale generation not sized to customer load | Document that generation is sized for customer consumption, not export-maximized |
Pro Tip: Restricted Feeders Are Not on a Public List
Hydro One does not publish a map of restricted or constrained feeders. The only way to confirm feeder availability before committing to a project is to contact the Distributed Connections Group directly. This is especially important in cottage country and rural areas, where aging infrastructure and seasonal peak loads can create unexpected capacity limits.
Frequently Asked Questions
What is the maximum solar system size for Hydro One net metering?
Ontario Regulation 541/05 allows net metering for renewable generation systems up to 500 kW. For residential micro-generation, systems at or below 10 kW use Hydro One’s simplified Form C application. Systems above 10 kW require a Connection Impact Assessment (CIA) using Form B, which involves additional fees, a signed study agreement, and a Professional Engineer-stamped single-line diagram.
How does Hydro One credit solar exports?
Hydro One credits exported electricity at the same rate you pay for electricity consumption — a 1:1 kilowatt-hour offset against your applicable Regulated Price Plan (RPP) rate. Credits can only be applied to variable electricity and delivery charges, not to fixed monthly charges or the Smart Meter Entity Charge. Credits roll forward for up to 12 consecutive months, after which unused credits expire with no cash payout.
Do I need an ESA permit for solar in Ontario?
Yes. Before or within 48 hours of starting any electrical work, a licensed Electrical Contractor must file a Notification of Work with the Electrical Safety Authority online at esasafe.com. Only licensed Electrical Contractors registered with the ESA can pull these permits — homeowners cannot self-permit solar installations in Ontario. ESA will inspect the completed installation before Hydro One installs the bidirectional meter.
What happens to unused Hydro One net metering credits?
Any credits that have been carried forward for 12 consecutive months are reset to zero — no cash payout, no transfer to another account. Ontario Regulation 541/05, Section 8(8) establishes this province-wide. Oversizing a system beyond annual consumption produces no financial benefit after the first year.
Does Ontario net metering apply to all LDCs, not just Hydro One?
Yes. Ontario Regulation 541/05 applies to every Local Distribution Company in Ontario. Toronto Hydro, Hydro Ottawa, London Hydro, Alectra, and all other Ontario distributors must offer net metering to eligible customers. The credit calculation method, 12-month carryover rule, and eligible renewable sources are standardized. Application portals, form names, and CIA fee schedules vary by utility.
Can I use a battery with Hydro One net metering?
Yes. Ontario’s net metering regulation was updated to allow energy storage systems to be paired with eligible renewable generation. The storage system must charge from the renewable source, not from the grid. Confirm the battery system configuration with Hydro One before submitting the application, as storage adds complexity to the interconnection review.
What is the Net Metering Confirmation of Disclosure?
The Ontario Energy Board’s Confirmation of Disclosure form is required when a third party (leasing company or PPA provider) owns the solar system installed on a customer’s property. The OEB introduced this requirement on July 1, 2022, to ensure customers entering third-party solar agreements understand the terms. The form is available on the OEB’s website and must be included with the Hydro One application for third-party arrangements.
For installers designing and sizing systems across Hydro One’s territory, accurate production modeling and professional interconnection documentation reduce revision cycles and speed up approvals. Solar design software that produces OESC-compliant single-line diagrams and net metering sizing summaries aligned to annual consumption — rather than peak generation — is the most direct way to cut the 4–8 week application-to-energization timeline.
See also: Canada solar compliance hub for provincial and utility guides across Canadian jurisdictions, and solar designing for an overview of the tools used to generate interconnection-ready project packages.
