Amending an Encroachment Agreement with the University of Toronto to enable low Carbon District Energy - by Councillor Dianne Saxe, seconded by Councillor Parthi Kandavel

Oak House has almost completed construction and is scheduled to open in September 2025. By provincial law, fossil fuel piping systems use the City's public right of way without payment, despite the climate damage that fossil fuels cause to our city. Nevertheless, the appraisal proposes an annual licensing fee of $50,000, indexed every five years to the Consumer Price Index. The University of Toronto objects to this fee, as it exceeds the total cost of constructing and installing the underground pipes, which provides low carbon heating and cooling to its new development and will be maintained entirely by the University of Toronto. As part of the University of Toronto's Climate Positive strategy, which has garnered the University of Toronto recognition as the world's most sustainable university, the University of Toronto is committed to modernizing and expanding its district energy system to support campus growth and reduce greenhouse gas emissions. However, the financial implications of the Oak House encroachment agreement were not anticipated by the University of Toronto. The University of Toronto advises that if the current fee structure remains, the expansion of district energy infrastructure will be financially unsustainable. Charging standard market-value rates for the use of the City's public highway may limit the uptake of net-zero, resilient energy sources in both new and existing developments. It is harmful to Toronto's TransformTO climate goals to charge low-carbon energy solutions more to use the public right of way than the City charges for comparable fossil fuel infrastructure. There could be benefits to allowing a reduction of fees if more projects can be realized.

and Environment Committee by the second quarter of 2026 on the feasibility of enabling low carbon energy infrastructure located in the public right-of-way or other public lands, including but not limited to, reductions in proposed licensing fees.