Ontario’s data-centre push could make another Lambton gas plant look necessary

Ontario is courting massive new data-centre loads while natural gas remains under consideration at the former Lambton Generating Station. Greg McConkey argues the concern isn’t a secret plan, but that new demand created through economic-development policy could eventually make another gas plant appear necessary.

What bothers me about the data-centre conversation in Lambton County is not simply that these projects use enormous amounts of electricity. It is that we are discussing them at the same time Ontario continues to keep new natural gas generation alive at the former Lambton Generating Station, and the two ideas have already been connected publicly by the people promoting them.

The concern is fairly straightforward, Ontario could approve enough new electricity demand that another natural gas plant eventually begins to look necessary, whether or not building one was the original intention.

In October 2025, the Sarnia-Lambton Economic Partnership wrote in support of Atura Power’s proposed Riverside Generating Station, a new 500-megawatt natural gas plant on the former Lambton Generating Station property. SLEP said the additional capacity could help accommodate future investment in low-carbon hydrogen, large-scale manufacturing, data centres and value-added agriculture. It also pointed to the site’s existing switchyard, natural gas pipelines and regional transmission connections.

A few months later, Sarnia-Lambton MPP Bob Bailey approached the same relationship from the other direction. Bailey said a prospective AI data-centre developer was looking at the region and that large data centres being built in Ontario required at least 100 megawatts of electricity. He said such a development could, in turn, expedite the proposed 500-megawatt Riverside gas plant.

That makes the relationship difficult to dismiss as speculation. We do not have to imagine a future in which data-centre demand is used to support the case for gas generation. Our own economic-development agency has argued that additional generation from Riverside could accommodate data centres, while our MPP has suggested data-centre demand could help advance Riverside.

Then the proposal was put through Ontario’s procurement process.

In June 2026, none of the five St. Clair Township gas proposals backed by township council was selected in the first window of the capacity stream of Ontario’s Second Long-Term Request for Proposals. That window awarded 20-year contracts to three battery-storage projects totalling 640 megawatts.

Associate Energy Minister Sam Oosterhoff later said the five St. Clair proposals were not competitive in that procurement and defended the process as technology-agnostic, saying the province wanted competition to determine the best resource. In that particular window, he said, the successful resource happened to be battery storage.

That result does not settle every future question about whether Ontario will need gas, batteries, nuclear or other resources. It does establish something narrower but still important, Riverside did not secure the contract it needed through that procurement round, while three storage projects did.

Atura did not respond by abandoning the Lambton site. After Riverside was not selected, the company said it would continue assessing future opportunities there in line with electricity-system needs. Its current Riverside materials also identify energy-intensive data centres among the forces driving Ontario’s growing electricity demand.

Only two months after that procurement result, Queen’s Park and Ontario Power Generation announced $500,000 in growth-readiness funding to continue planning for new generation at the Lambton property, explicitly including both natural gas and nuclear.

Nuclear has increasingly become part of that discussion, particularly small modular reactors, but so far it has occupied a different place in it. Nuclear remains a longer-term possibility requiring years of planning, approvals and construction. Natural gas, meanwhile, has already produced an actual 500-megawatt project proposal.

Atura has pointed to Lambton’s access to high-voltage transmission and reliable natural gas as advantages for Riverside. It also describes gas plants as “transitional assets” that can help bridge rising demand until storage, renewables and other non-emitting generation can meet peak needs.

The idea is not that Riverside would eventually become a nuclear plant. SLEP’s own letter instead envisioned Riverside operating for more than 20 years while other pathways, including possible small modular nuclear development on the same property, were assessed and commissioned.

That makes the idea of gas as a bridge worth examining carefully. If new gas generation is built to meet nearer-term demand while nuclear remains a longer-term possibility, the immediate decision is still to build a separate fossil-fuel plant with its own infrastructure, economics and operating life.

Natural gas was on the table before Riverside was proposed. It remained there while Riverside was being developed. It remains part of the site’s future-generation discussion after Riverside was unsuccessful in the first LT2 capacity window. And all of this is happening while Ontario is actively trying to attract some of the largest new electricity consumers imaginable.

Ontario launched the framework for its Data Centre Playbook in August with the explicit goal of attracting major new investment. The province’s own consultation material says proposed data-centre connection requests across Ontario could cumulatively exceed 10,000 megawatts. That figure represents proposed connections, not facilities certain to be built, but for comparison Ontario’s recent peak electricity demand has been about 25,000 megawatts.

The scale matters because Ontario is not simply responding to electricity demand that exists independently of government. It is making an economic-development choice to encourage a new industry whose infrastructure requirements can include extraordinary amounts of electricity.

The province also says it plans to prioritize data-centre proposals capable of generating their own power.

In Lambton County, natural gas is an obvious part of that conversation. We have gas pipelines, existing gas-fired stations, heavy industrial infrastructure, high-voltage transmission infrastructure and a former generating-station property where a Crown-owned company has already proposed a 500-megawatt gas plant.

Those facts matter when MP Marilyn Gladu says seven or eight data-centre proponents are looking at Lambton County. She has pointed to the former OPG property or adjacent lands among potential locations and has specifically cited electricity, grid access, water and the region’s natural gas supply among the area’s advantages.

Taken together, those facts raise a legitimate concern about how a series of policy choices can eventually make something that was once optional appear necessary.

If Ontario attracts and approves data centres consuming hundreds of megawatts of electricity, those projects will contribute to higher electricity demand and future planning forecasts. A gas plant that did not secure a contract under one set of system needs could therefore return to the discussion later under different circumstances, with higher demand forming part of the argument for additional generation.

That makes it important to ask where the demand itself came from.

Some electricity growth is difficult to avoid. Ontario is growing. Transportation and heating are being electrified. Existing industries, businesses and homes require power.

A new 100-megawatt data centre is different. It is an industrial load government is actively choosing to attract.

Data centres can bring construction work, tax assessment and investment, and there are legitimate reasons for Canada to want domestic computing infrastructure. But if attracting those projects changes how much generation Ontario needs, then the generation required to serve them should be considered part of the development decision too.

The latest Independent Electricity System Operator outlook forecasts substantial long-term growth in electricity use, with incremental energy needs emerging by 2032. But it says Ontario’s existing and recently procured resources can meet most capacity requirements until the mid-2030s, with incremental capacity needs beginning at less than 100 megawatts in 2034. The IESO also notes that existing gas generation is currently modelled below its full capability and could produce more energy if required.

Ontario therefore has every reason to plan ahead. But planning ahead should include asking what kind of new demand we are choosing to create and what infrastructure we are prepared to build to serve it.

SLEP has already argued Riverside could help accommodate data centres. Bailey has suggested data-centre demand could help move Riverside forward. Atura itself now identifies energy-intensive data centres as one of the forces increasing electricity demand, while natural gas remains among the options Ontario is considering at Lambton.

That is enough to make the power question part of the data-centre debate now. If future demand rises because Ontario chooses to recruit enormous new industrial loads, that context should not disappear later when the province decides how to supply them. Another gas plant should still have to make the case for itself.