Distribution System Operator Capabilities

In response to the 2024 Minister of Energy and Electrification’s Letter of Direction, the OEB is initiating a consultation to define a policy framework and set expectations for electricity distributors regarding the development of Distribution System Operator (DSO) capabilities.

A DSO is an entity with advanced capabilities to integrate, manage and optimize DERs for distribution and wholesale market services. Developing DSO capabilities can provide new means for ensuring reliable and cost-effective distribution services at the same time as enhancing opportunities for Distributed Energy Resources (DERs).

A priority for this work will be ensuring that the introduction of DSO capabilities and potential evolution of the distribution utility deliver optimal value to customers over time. The result of the consultation will be to set out expectations and regulatory requirements regarding the introduction, pacing and scope of new functions at the distribution level, including the roles of electricity distributors.

This effort relates to several ongoing OEB DER-enablement and grid modernization activities, including the Non-Wires Solutions Guidelines, the Benefit-Cost Analysis Framework for Addressing Electricity System Needs, and the Distribution System Capacity Information Map. This project will also be informed by lessons learned from pilots and demonstration projects undertaken through the OEB/Independent Electricity System Operator (IESO)’s DER Integration Joint Targeted Call, and the OEB’s Innovation Sandbox Challenge.

In response to the 2024 Minister of Energy and Electrification’s Letter of Direction, the OEB is initiating a consultation to define a policy framework and set expectations for electricity distributors regarding the development of Distribution System Operator (DSO) capabilities.

A DSO is an entity with advanced capabilities to integrate, manage and optimize DERs for distribution and wholesale market services. Developing DSO capabilities can provide new means for ensuring reliable and cost-effective distribution services at the same time as enhancing opportunities for Distributed Energy Resources (DERs).

A priority for this work will be ensuring that the introduction of DSO capabilities and potential evolution of the distribution utility deliver optimal value to customers over time. The result of the consultation will be to set out expectations and regulatory requirements regarding the introduction, pacing and scope of new functions at the distribution level, including the roles of electricity distributors.

This effort relates to several ongoing OEB DER-enablement and grid modernization activities, including the Non-Wires Solutions Guidelines, the Benefit-Cost Analysis Framework for Addressing Electricity System Needs, and the Distribution System Capacity Information Map. This project will also be informed by lessons learned from pilots and demonstration projects undertaken through the OEB/Independent Electricity System Operator (IESO)’s DER Integration Joint Targeted Call, and the OEB’s Innovation Sandbox Challenge.

Page last updated: 18 Dec 2025, 10:52 AM