What Changed in Ontario’s Net Metering Program in 2026?
As of May 1, 2026, the Ontario Energy Board increased the micro-embedded generation threshold from 10kW to 12kW, allowing more homeowners with grid-tied solar systems to qualify for simplified connection processes and participate in net metering.
Why This Change Matters
Ontario’s solar market has been steadily growing, but regulatory friction often slows adoption. The 2026 update to the Distribution System Code (DSC) is one of the most practical and impactful changes in recent years.
At its core, this update removes a key bottleneck: outdated system size limits that no longer reflect modern solar technology.
While increasing a threshold from 10kW to 12kW might sound incremental, the implications are significant:
• More homeowners qualify for net metering.
• Fewer projects require complex engineering studies.
• Solar systems can now be designed for performance, not regulation.
This article breaks down the technical details in a clear, practical way, so you understand exactly what this means for your home, your system, and your return on investment.
Understanding Net Metering in Ontario
Net metering is a billing mechanism that allows grid-connected solar systems to interact dynamically with the electrical grid.
How It Works
A grid-tied solar power system operates in three modes:
1. Self-consumption: Solar energy powers your home directly.
2. Export (surplus generation): Excess electricity flows back to the grid.
3. Import (deficit periods): You draw power from the grid when solar production is low.
A bidirectional meter tracks both directions of energy flow.
Billing Mechanics
• Exported electricity earns kWh credits
• Credits are applied at the full retail electricity rate
• Credits can be carried forward for up to 12 months
• Unused credits expire annually
The Core Change: 10kW → 12kW Micro-Embedded Threshold
Technical Definition
The DSC defines a micro-embedded generation facility as:
"A system with a nameplate capacity of 12kW or less (previously 10kW)"
This classification determines whether your system qualifies for:
• Simplified connection procedures
• Standardized agreements
• Faster approval timelines
Why the Threshold Increase Was Necessary
1. Technology Has Outgrown the Old Rules
Modern residential solar systems commonly include:
• Hybrid inverters (10–12kW range)
• High-production large-wattage solar panels
• Electrification loads (EVs, heat pumps)
Under the old 10kW limit, these systems were artificially constrained.
2. The Old Rule Created Inefficiencies
Homeowners and installers were forced to:
• Downsize systems below optimal levels
• Accept lower production and ROI
3. The New Rule Aligns Policy with Reality
The updated 12kW threshold reflects:
• Current equipment standards
• Real household energy demand
• Industry best practices
What This Means for Grid-Tied Solar Owners
Expanded Eligibility for Net Metering
If your system falls within 10–12kW:
• You now qualify for simplified connection
• You can participate in net metering
• You avoid unnecessary engineering costs
This is particularly important for:
• Larger homes
• Electrified households
• Properties with EV charging
Simplified Connection Process (Technical Breakdown)
Systems ≤12kW benefit from:
No Connection Impact Assessment (CIA)
A CIA is typically required to:
• Evaluate grid capacity
• Analyze voltage and fault current
• Determine infrastructure upgrades
Avoiding a CIA means:
• Faster approvals
• Lower costs
• Reduced uncertainty
Standardized Connection Agreement
Instead of custom engineering reviews, homeowners sign a:
• Micro-Embedded Generation Facility Agreement
• Predefined technical and safety requirements
Improved System Design Flexibility
Installers can now design systems that:
• Match actual annual consumption
• Maximize available roof space
• Take advantage of higher-power solar panels
This leads to:
• Higher annual energy production
• Better offset of electricity bills
• Improved long-term ROI
Impact on Previously Rejected Applications
One of the Biggest Hidden Opportunities
If your solar application was rejected before 2026, there’s a strong chance the outcome would now be different.
Common Past Rejection Scenarios
• System size exceeded 10kW
• CIA costs made project unviable
• Approval timelines were too long
What’s Changed
Those same systems may now:
• Qualify under the 12kW threshold
• Skip the CIA process entirely
• Be approved significantly faster
Actionable takeaway:
If your system was between 10kW and 12kW, reapply.
Additional 2026 Changes That Affect Solar Connections
While the threshold increase is the headline, several supporting changes improve the overall experience.
1. Insurance Requirements Simplified
• Residential customers are no longer required to carry commercial insurance
• Reduces cost and administrative burden
2. Standardized Timelines
Typical connection timelines:
• ~60 days (no upgrades required)
• ~75 days (multi-utility coordination)
• ~90 days (infrastructure upgrades required)
This improves predictability for project planning.
3. Broader Equipment Standards
Utilities can now accept a wider range of:
• Certified inverters
• High-power solar power panels
• Electrical components
This reduces:
• Procurement delays
• Product limitations
• Compatibility issues
Practical Implication
When designing a system:
• Ensure total effective output stays within 12kW
• Use properly certified equipment
• Work with experienced installers like our team at Solar Power Store
Net Metering vs Non-Exporting Systems
Homeowners now face a strategic choice:
Net Metering (Exporting)
Benefits:
• Earn credits for excess energy
• Simple system design
Considerations;
• No access to certain rebates
• Dependent on grid policies
Non-Exporting Systems
Benefits:
• Eligible for rebates (up to $10,000)
• Designed with battery storage
• Reduces grid dependence
Considerations:
• Not eligible for export credits
• Requires more advanced system design
Where the 12kW Rule Fits In
The new threshold benefits both approaches by:
• Expanding eligibility
• Simplifying approvals
• Supporting modern system configurations
Real-World Example
Scenario: 11kW Solar System
Before 2026
• Exceeds 10kW threshold
• Requires CIA
• Adds cost and delays
• May not proceed
After 2026
• Qualifies as micro-embedded
• No CIA required
• Faster approval
• Eligible for net metering
Result: Same system, lower cost, faster installation, higher likelihood of approval.
Common Questions
Can I Install a 12kW solar system in Ontario?
Yes. As of 2026, grid-tied systems up to 12kW qualify for simplified connection and net metering eligibility.
Does this change how net metering credits work?
No. Credit structure remains unchanged:
• Full retail rate
• 12-month rollover
• No cash payouts
Should I upgrade my system to 12kW?
Possibly. If your current system is undersized:
• You may benefit from expansion
• Approval depends on your utility
Is 12kW enough for a typical home?
For many electrified homes (EV + heat pump), yes.
However, system size should be based on:
• Annual consumption (kWh)
• Roof space
• Budget
Strategic Takeaways for Homeowners
If You’re Considering Solar
• Design systems up to (but not exceeding) 12kW where possible
• Maximize eligibility for simplified approvals
If You Were Previously Rejected
• Reapply under the new rules
• Focus on systems within the 12kW threshold
Industry-Level Impact
From a technical and policy standpoint, this change:
• Reduces administrative bottlenecks
• Encourages distributed generation
• Aligns with electrification trends
• Supports grid modernization
It also signals a broader shift toward:
• Consumer-controlled energy systems
• Decentralized infrastructure
• Increased solar adoption across Ontario
A Practical Win for Solar Power Adoption
The 2026 update to Ontario’s net metering framework is a clear example of smart regulatory evolution.
By increasing the micro-embedded threshold to 12kW, the province has:
• Removed outdated constraints
• Enabled better system design
• Improved project viability
• Expanded access to clean energy
For homeowners, the result is simple:
More opportunity, less friction, better outcomes.
Next Steps
If you’re ready to explore solar under the new rules:
• Review system options that fall within the 12kW range
• Compare net metering vs non-exporting pathways
• Work with experienced suppliers and installers, like our team at Solar Power Store
Want to learn more about net metering in Ontario and how you can take advantage of all the benefits of grid-tied solar power? Contact us today for a custom solar quote, or book a call with one of our solar experts.
