Ontario Bill 5: Economic Risk, Market Instability and Private Sector Fallout (2025)

Credit Ratings and Investor Confidence

In Q1-Q2 2025, Fitch and Moody’s revised Ontario’s infrastructure outlook to “negative.” The chart shows risk premium change and investor sentiment index for energy-linked bonds. Sources: Fitch, Moody’s, CanREA, CCE Tracker, CBC[2]

Clean Energy Investment and Capital Flight

Q1 2025 saw a 27% drop in clean energy investment (QoQ). Ontario’s share of new project announcements fell below 15% in Q2-the lowest since 2015. The chart shows investment trends and project reallocation by region. Sources: CanREA, CCE Tracker, Enwave, Boralex

Special Economic Zones (SEZs) and Market Participation

As of June 2025, 3 SEZs have been designated. Foreign direct investment in SEZ projects remains uncertain due to regulatory ambiguity. The chart shows SEZ growth and investor participation by origin. Sources: Ontario Legislature, CBC, McCarthy Tétrault[4][5]

Gas Lock-In and Generation Mix Shift

All new capacity contracts in 2025 were for gas-fired plants. Analysts project a 17% rise in grid emissions intensity by 2027 if current policies persist. The chart shows new capacity by source and emissions forecast. Sources: IESO, Canadian Climate Institute, Clean Energy Canada

Broader Market and Consumer Impact

Ontario’s cost of capital for new infrastructure rose by 35-50 bps post-Bill 5. The chart shows risk-adjusted return expectations and energy bill impact for public and residential users. Sources: Auditor General, CCE Tracker, CanREA

Data: Fitch, Moody’s, CanREA, IESO, CCE Tracker, Auditor General, CBC, McCarthy Tétrault, June 2025.

Economic Risk, Market Instability, and Private Sector Fallout