OEB Maintains Decision To Eliminate Seasonal Rate Class

After years of uncertainty, the Ontario Energy Board (OEB) has decided to maintain their 2015 decision to eliminate the seasonal rate class and transition Hydro One customers to rates based on location density.

The OEB released their decision and order regarding the issue on Sept. 17 after reviewing Hydro One’s proposal to retain seasonal rates. Groups including the Vulnerable Energy Consumers Coalition (VECC), the Consumers Council of Canada (CCC) and the Federation of Ontario Cottagers’ Association (FOCA) opposed the change due to the rate impact on seasonal customers, particularly because seasonal residents do not qualify for subsidies through Rural or Remote Rate Protection (RRRP) or Distribution Rate Protection (DRP). In their decision, the OEB stated that they do not and cannot factor provincial programs such as the DRP into rate design because the OEB does not determine how and when the programs may change or which customers are eligible to receive them.

“The submissions of the parties generally focused more on the bill impacts that would flow from the elimination of the seasonal class… The fact that there are impacts associated with the elimination of the seasonal class does not render the decision to eliminate the class in order to more accurately reflect those customers’ relative use of distribution assets incorrect,” said the OEB in their decision.

The OEB also said rate mitigation could play an important role in implementing the decision. In the past, the OEB stated that they wish to mitigate any large impacts to seasonal customers and expect Hydro One’s plan to “propose a phase-in period for those customers expected to experience a total bill impact of greater than 10% as a result of migrating to another class.” 

Imran Merali, Hydro One’s vice president of customer service, said in a statement that the company is disappointed with the OEB’s decision to eliminate the seasonal rate class for their customers.

“We advocated for a different solution that would have protected our seasonal customers and reduced the rate impact,” Merali said. “We want our customers to rest assured that their rate class won’t immediately change. The next step is to submit an updated report on implementing the elimination of the seasonal class to the Ontario Energy Board by October 15, 2020. We will continue to advocate for our customers throughout this process.”

To learn more about the issue, read our original coverage below. For more background on Hydro One’s efforts to retain the seasonal class, click here.