The Ontario government is not considering changing its law that prevents municipalities from charging Enbridge Gas for building pipelines on public land, despite calls to do so.

“I’m not aware of any contemplation of amending the current policy,” Ontario Energy Minister Stephen Lecce told reporters during a Jan. 7 press conference in Toronto.

Last November, Waterloo Region became the second Ontario municipality, after Guelph, to resist renewing these agreements. Doing so would have meant locking in for another two decades of offering free space to pipelines that carry natural gas, which is largely made up of methane, a potent greenhouse gas that traps heat in the atmosphere.

Through longstanding regulation, the province prohibits municipalities from charging for the right of way used for natural gas pipelines. 

The law requires municipalities to enter into franchise agreements with natural gas providers, allowing them to build pipelines under roadways and surrounding lands without charge. Enbridge Gas has these agreements with more than 340 municipalities, the details of which are negotiated through the Ontario Energy Board, a non-partisan regulator mandated to uphold provincial law.

These are unique arrangements in Canada; in provinces including British Columbia and Alberta, municipalities can charge gas companies that want to build pipelines on their land. 

Along with Waterloo Region and Guelph, both Ottawa and Toronto have argued changes to these agreements would give local councils a much-needed source of revenue, along with the ability to move away from fossil fuels and reduce emissions in their cities. 

“Were the province to amend its regulation and city council decided to apply a land-based charge to Enbridge’s use of the right of way, it could generate between $73 million and $293 million in total annual revenue,” according to City of Toronto staff, based on how such charges are applied elsewhere.

As of December 2025, neither Guelph nor Waterloo had received an official response from the province. 

In his Jan. 7 response to a question from The Narwhal about potential changes to the policy, Lecce deferred to the Ontario Energy Board. The board has announced a full review of these agreements in spring 2026 — the first since 1999. That will play out at the board alongside individual cases about Guelph and Waterloo Region’s agreements with Enbridge Gas. 

“The Ontario Energy Board is an independent adjudicator,” Lecce said. “They make sure that any cost that is borne on the ratepayer is prudent. … I have confidence in the [board].”

A spokesperson for Enbridge Gas previously told The Narwhal the company would not comment on the upcoming hearings, but that the board “reviews and approves every agreement to make sure it’s fair and in the public interest.”

Regardless of the board’s decision, the government would have to amend the Municipal Act to allow municipalities to charge gas utilities for pipeline right of way going forward. Ontario Green Party Leader Mike Schreiner, who is the MPP for Guelph, has twice tabled a private member’s bill proposing this amendment, with the latest iteration awaiting second reading. 

The upcoming Ontario Energy Board hearings between Enbridge Gas and the municipalities come in the wake of the board’s 2023 decision, when it ordered the company to stop passing down the cost of new gas hookups to homeowners on their bills, arguing cleaner and more economical alternatives exist. In early 2024, the Ford government made the unprecedented decision to overrule the regulator’s decision. After that, the government created a new energy policy that keeps natural gas, a fossil fuel, in Ontario’s supply mix until at least 2050. 

When asked if the government would accept the board’s decision on franchise agreements, Lecce said, “We want to seek alignments with the [board].” 

“We respect their independence, and obviously, I’m not going to entertain hypotheticals that may or may not come down the pipe in a year or two or three,” he added. “Our message to the [Ontario Energy Board] … is we want to focus on the economy, keep costs down.”

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