Enbridge Gas will face Waterloo Region in a hearing before the Ontario Energy Board to renew an agreement that would allow the company to continue building pipelines on public land without charge for another 20 years.
Such agreements “are in the public interest” and “work for communities, customers and the province as a whole,” an Enbridge Gas spokesperson has told The Narwhal.
The hearing comes after Waterloo Region resisted renewing its contract with Enbridge Gas, known as a model franchise agreement, in November. Doing so would have locked the municipality into offering free land to the company that sells natural gas, which is largely made up of methane, a potent greenhouse gas that traps heat in the atmosphere. These agreements also absolve Enbridge Gas of responsibility for removing outdated pipelines, leaving the costs and labour of doing so with cash-strapped municipalities.
Waterloo Region’s refusal to re-sign follows a similar decision by Guelph in late 2024, which Enbridge Gas will contest in a hearing in 2026.
“We respect the [Ontario Energy Board’s] jurisdiction and will not comment on the details of the Waterloo Region application,” Enbridge Gas spokesperson Chloe Mills told The Narwhal in an emailed response on Dec. 24.
As a regulated utility, the company is required to participate, Mills added. “This is a long-standing legislated process that ensures transparency and fairness — it’s not about one party taking another to the [board], but about following statutory requirements,” she said.
Ontario law requires municipalities to enter into agreements with natural gas providers. Fossil fuel giant Enbridge Gas has these agreements with more than 340 municipalities, but after 20 years in place, two communities are refusing to re-sign. Photo: Christopher Katsarov Luna / The Narwhal
Ontario law requires municipalities to enter into 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 energy board, a non-partisan regulator mandated to uphold provincial law.
The Ontario Energy Board has announced a full review of these agreements in spring 2026, the first since 1999. That will play out alongside the company’s push for Guelph and now Waterloo Region to renew. The request to weigh in on the region’s refusal was laid out by the board in a letter issued to the company on Dec. 19, and confirmed to The Narwhal by a board spokesperson.
“The Ontario Energy Board confirms that Enbridge [Gas] has filed an application for the renewal of a municipal franchise agreement with the Regional Municipality of Waterloo,” Tom Miller, board spokesperson, said.
A spokesperson for Waterloo Region said it is not able to comment on the hearing as “the matter is ongoing.”
Elected officials from Waterloo Region and Guelph, along with energy lawyers and experts, have previously told The Narwhal these agreements are misaligned with goals to reduce emissions quickly, as scientists urge a shift away from gas and other fossil fuels to mitigate the worst impacts of global warming.
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City councils in both Ottawa and Toronto have shared similar concerns with the Ontario government. Representatives from the municipalities have said the agreements amount to a subsidy for the fossil fuel company.
Enbridge Gas says these claims are “simply not true.”
The Narwhal sent the company questions about these agreements four business days before publishing a story Dec. 17, on Waterloo Region’s decision not to renew. After that story was published, the company responded to the questions in an email, in which Mills told The Narwhal the Ontario Energy Board has determined the terms of the agreements “exist to defend the interests of our customers.”
“In the Region of Waterloo alone, we serve over 105,000 customers — including homes, businesses, schools and hospitals that rely on natural gas every day,” Mills said. “The [agreements] ensure that communities continue to have ready, affordable access to the energy they rely on every day.”
Enbridge Gas says fees for use of roadways ‘would simply be passed on to customers’
In the Dec.17 statement from Enbridge Gas, Mills said the franchise agreements “provide a uniform standard that protects both customers and municipalities with clear, consistent rules for building, maintaining and upgrading gas infrastructure.”
“This keeps projects safe and costs predictable,” she continued. “This standardized approach means everyone plays by the same rules and prevents one-off local deals that could drive up bills for families and businesses.”
But in recent years, many Ontario municipalities have been implementing localized plans to reach net-zero emissions by 2050. Unique initiatives range from green building standards that prioritize electric heating over natural gas connections in some cities and towns to building multi-use roadways that include bike lanes and walking trails in others.
Cities are also looking to install more fibre optic cables to ensure access to fast internet, upgrade stormwater systems to handle flooding and more sewage intake, bury transmission lines to protect them from extreme weather and build transit.
In light of all this, Waterloo Region and Guelph argue it no longer makes sense that Enbridge Gas — a for-profit company — gets to use much-needed underground space for free. Meanwhile, in provinces like British Columbia and Alberta, where pipelines are built in greater numbers, municipalities can charge gas companies that want to build pipelines on their land.
Mills said these provinces have different laws and ownership rules for public utilities. If Ontario changed its laws to allow the same, Mills said, “Additional costs would simply be passed on to customers. Our system helps keep energy affordable and allows for customer choice.” Enbridge Gas can apply to the Ontario Energy Board for approval to increase rates, as it recently did.
Mills also noted gas utilities do pay municipalities in the form of property taxes. And while provincial regulations do not allow municipalities to charge utilities for the use of roadways, they are able to charge gas utilities — as well as electricity and telecoms — for the administrative costs of issuing permits, she added.
She said any municipality that wants to change its agreement “must show the [Ontario Energy Board] there’s a good reason for it that is unique to the municipality and the [board] will decide whether a change is warranted.”
Mills added that the board “reviews and approves every agreement to make sure it’s fair and in the public interest.”
Miller, with the Ontario Energy Board, declined to comment on the individual cases, or the broader review of the agreements. He confirmed the review will happen in 2026 and said it would be “informed by recent applications” and “examine the need to update certain provisions” of the model franchise agreements.
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. In early 2024, the Ford government made the unprecedented decision to overrule the regulator’s decision.
“While it is always the prerogative of governments to make policy and seek to pass laws, our approach has not changed,” Miller told The Narwhal in an email. “The independence and transparency of decisions is fundamental to a healthy regulatory model, allowing for impartial, evidence-based decision-making that fosters confidence in the sector by regulated entities, investors and the public that we serve.”
