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Ontario Energy Board Act, 1998
Loi de 1998 sur la commission de l’énergie de l’Ontario

ONTARIO REGULATION 442/01

RURAL OR REMOTE ELECTRICITY RATE PROTECTION

Historical version for the period March 4, 2016 to July 28, 2016.

Last amendment:  O. Reg. 52/16.

This Regulation is made in English only.

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CONTENTS

1.

Definitions

2.

Eligibility for rate protection

4.

Amount of rate protection:  2003 and 2004

5.

Compensation for distributors

Schedule 16

Other areas

Definitions

1. (1) In this Regulation,

“government premises” means premises occupied by the Crown in right of Canada or Ontario or a facility that is funded in whole or in part by the Crown in right of Canada or Ontario, but does not include premises occupied by,

(a) Canada Post Corporation, the Services Corporation or a subsidiary of the Services Corporation, or

(b) social housing, a library, a recreational or sports facility, or a radio, television or cable television facility;

“IESO” and “IESO-controlled grid” have the same meaning as in the Electricity Act, 1998;

“market participant” means a market participant under the Electricity Act, 1998;

“rate protection” means rate protection under section 79 of the Act;

“remote area” means a part of Ontario not connected to the IESO-controlled grid that receives electricity from Hydro One Remote Communities Inc.;

“residential premises” means a dwelling occupied as a residence continuously for at least eight months of the year and, where the residential premises is located on a farm, includes other farm premises associated with the residential electricity meter;

“rural area” means those parts of Ontario connected to the IESO-controlled grid that, before March 31, 1999, received electricity from Ontario Hydro and, at the time subsection 26 (1) of the Electricity Act, 1998 comes into force, are receiving electricity from Hydro One Networks Inc.;

“Services Corporation” has the same meaning as in the Electricity Act, 1998.  O. Reg. 442/01, s. 1 (1); O. Reg. 383/04, s. 1 (1); O. Reg. 391/09, s. 1.

(2) Revoked:  O. Reg. 383/04, s. 1 (2).

Eligibility for rate protection

2. In addition to the persons described in subsection 79 (2) of the Act, the following classes of consumers in Ontario are eligible for rate protection:

1. Revoked:  O. Reg. 383/04, s. 2.

2. Consumers who occupy residential premises in a rural area and who, if section 108 of the Power Corporation Act had not been repealed by section 28 of Schedule E to the Energy Competition Act, 1998 and electricity had continued to be distributed by Ontario Hydro, would have been entitled, pursuant to section 108 of the Power Corporation Act as it read on March 31, 1999, to pay Ontario Hydro a discounted rate for the electricity they consumed.

3. Consumers who occupy residential premises in an area referred to in Schedule 16, if Ontario Hydro distributed electricity in the area before December 16, 1997 and electricity in the area is now distributed by a distributor connected to the IESO-controlled grid, other than a subsidiary of Hydro One Networks Inc.

4. Consumers who occupy premises, other than government premises, in a remote area.

5. Consumers,

i. who are treated as residential-rate class customers under Ontario Regulation 445/07 (Reclassifying Certain Classes of Consumers as Residential-Rate Class Customers:  Section 78 of the Act) made under the Act, or

ii. who occupy residential premises in an area served by a distributor where,

A. the distributor is licensed to serve the consumers,

B. the area is not less than 10,000 square kilometres in size, and

C. the average customer density for the distributor is less than seven customers per kilometre of distribution line.  O. Reg. 442/01, s. 2; O. Reg. 262/03, s. 1; O. Reg. 383/04, s. 2; O. Reg. 446/07, s. 1; O. Reg. 391/09, s. 2.

3. Revoked:  O. Reg. 383/04, s. 3.

Amount of rate protection:  2004 and 2005

4. (1) The total amount of rate protection available for eligible consumers in each of the years 2004 and 2005 is $127 million, plus the amount calculated under subsection (2) for the year.  O. Reg. 442/01, s. 4 (1); O. Reg. 383/04, s. 4 (1).

(1.1) The total amount of rate protection for eligible consumers in each year after 2005 shall not exceed $127 million plus the amount calculated under subsections (2) and (3.1) and shall be based on the amount of rate protection provided by the distributor to eligible consumers for the previous year.  O. Reg. 335/07, s. 1 (1).

(2) For each year, the Board shall calculate the amount by which Hydro One Remote Communities Inc.’s forecasted revenue requirement for the year, as approved by the Board, exceeds Hydro One Remote Communities Inc.’s forecasted consumer revenues for the year, as approved by the Board.  O. Reg. 442/01, s. 4 (2); O. Reg. 383/04, s. 4 (3).

(3) For the purpose of subsection (2), Hydro One Remote Communities Inc.’s forecasted consumer revenues for a year shall be based on the rate classes set out in Transitional Rate Order RP-1998-0001 made by the Board and on the rates set out for those classes in the most recent rate order made by the Board.  O. Reg. 442/01, s. 4 (3).

(3.1) For each year, in respect of the rates for a distributor serving consumers described in paragraph 5 of section 2, the Board shall calculate the amount by which the distributor’s forecasted revenue requirement for the year, as approved by the Board, exceeds the distributor’s forecasted consumer revenues for the year, as approved by the Board.  O. Reg. 335/07, s. 1 (2).

(3.2) For the purpose of subsection (3.1), the distributor’s forecasted consumer revenues for a year shall be based on the rate classes and on the rates set out for those classes in the most recent rate order made by the Board and shall be adjusted in line with the average, as calculated by the Board, of any adjustment to rates approved by the Board for other distributors for the same rate year.  O. Reg. 335/07, s. 1 (2).

(4) For each year, the Board shall calculate the amount of rate protection for individual consumers referred to in subsection 79 (2) of the Act and in section 2 of this Regulation in a manner that ensures that the total amount of rate protection for those consumers is equal to the total amount of rate protection available for the year under subsection (1) or (1.1), according to the following rules:

1. Revoked:  O. Reg. 383/04, s. 4 (5).

2. For each of the areas referred to in Schedule 16, the Board shall take reasonable steps to ensure that, for each month, the total amount of rate protection for consumers in the area who are in the class described in paragraph 3 of section 2 is the total monthly amount set out for that area in Schedule 16.

3. The Board shall take reasonable steps to ensure that an amount equal to the amount calculated under subsections (2) and (3.1) for the year is used to provide rate protection to consumers who are in the class described in paragraphs 4 and 5 of section 2.

4. After paragraphs 2 and 3 are complied with, the Board shall take reasonable steps to ensure that the remainder of the total amount of rate protection available under subsections (1) and (2) is used to provide rate protection to,

i. the persons described in subsection 79 (2) of the Act, and

ii. the consumers who are in the class described by paragraph 2 of section 2.  O. Reg. 442/01, s. 4 (4); O. Reg. 262/03, s. 2; O. Reg. 383/04, s. 4 (4-6); O. Reg. 335/07, s. 1 (3).

(5) Any distributor that distributes electricity to eligible consumers shall provide, on a quarterly basis, such information relating to this Regulation as the Board may require, in a form specified by the Board.  O. Reg. 383/04, s. 4 (7).

Compensation for distributors

5. (0.1) In this section,

“rate protection interest costs” means interest costs incurred by the IESO for the purpose of ensuring that payments to distributors are made in accordance with clause (7) (b). O. Reg. 52/16, s. 1 (1).

(1) The Board shall calculate the amount of the charge to be collected by the IESO under subsection (5) for each kilowatt hour of electricity that is withdrawn from the IESO-controlled grid, as determined in accordance with the market rules, for use by consumers in Ontario, so that the total amount forecast to be collected is equal to the total amount of rate protection to be provided.  O. Reg. 383/04, s. 5 (1); O. Reg. 391/09, s. 3 (1).

(2) At least 60 days before the end of each calendar year, the IESO shall submit to the Board,

(a) a forecast of the number of kilowatt hours of electricity that will be withdrawn from the IESO-controlled grid, as determined in accordance with the market rules, for use by consumers in Ontario during the next calendar year; and

(b) supporting documentation for the forecast.  O. Reg. 442/01, s. 5 (2); O. Reg. 391/09, s. 3 (2, 3).

(3) The forecast shall be derived from information submitted to the Board under section 19 of the Electricity Act, 1998 in respect of the next fiscal year  O. Reg. 442/01, s. 5 (3).

(4) Revoked: O. Reg. 52/16, s. 1 (2).

(5) The IESO shall collect the charge calculated by the Board under subsection (1) from market participants and any other person who, with the approval of the IESO, withdraws electricity from the IESO-controlled grid for use by consumers in Ontario.  O. Reg. 442/01, s. 5 (5); O. Reg. 391/09, s. 3 (5).

(6) A distributor or retailer who bills a consumer for electricity shall aggregate the amount that the consumer is required to contribute to the compensation required by subsection 79 (3) of the Act with the wholesale market service rate described in the Electricity Distribution Rate Handbook issued by the Board, as it read on October 31, 2001.  O. Reg. 442/01, s. 5 (6).

(7) Each month, the IESO shall,

(a) record the charges collected under subsection (5) in the preceding month; and

(b) from those charges, pay to distributors the compensation to which they are entitled under subsection 79 (3) of the Act. O. Reg. 52/16, s. 1 (3).

(8) Any amounts remaining after payments are made to distributors under clause (7) (b) may be used by the IESO to defray any rate protection interest costs it has incurred. O. Reg. 52/16, s. 1 (3).

(9) The IESO shall establish a variance account that records differences between the amounts collected by the IESO under subsection (5) and the sum of the amount paid under clause (7) (b) and any amounts used for the purposes of subsection (8). O. Reg. 52/16, s. 1 (3).

(10) Any interest or other income earned on the variance account shall be held in the account and shall be used for the purposes of clause (7) (b), subject to subsection (8). O. Reg. 52/16, s. 1 (3).

(11) Revoked:  O. Reg. 383/04, s. 5 (2).

(12) If the amount collected under subsection (5) in a year exceeds the total amount of rate protection available for eligible consumers under subsection 4 (1.1) for that year plus any rate protection interest costs incurred in that year, the excess shall be applied against the amount necessary to compensate distributors who are entitled to compensation under subsection 79 (3) of the Act for the following year. O. Reg. 52/16, s. 1 (4).

(13) If the amount collected under subsection (5) in a year is less than the total amount of rate protection available for eligible consumers under subsection 4 (1.1) for that year plus any rate protection interest costs incurred in that year, the difference shall be added to the amount necessary to compensate distributors who are entitled to compensation under subsection 79 (3) of the Act for the following year. O. Reg. 52/16, s. 1 (4).

(14) Hydro One Networks Inc. shall transfer the charges it received from the IESO under this section that are held by it on the day Ontario Regulation 52/16 comes into force back to the IESO. O. Reg. 52/16, s. 1 (4).

(15) The IESO may not use charges for the purposes of subsection (8) until it pays to Hydro One Networks Inc. an amount necessary to meet the deficit, if any, between the amounts Hydro One Networks Inc. received under this section and the amounts paid by Hydro One Networks Inc. to distributors under this section, as of the day referred to in subsection (14). O. Reg. 52/16, s. 1 (4).

(16) For the purposes of subsections (14) and (15), a reference to this section is a reference to this section as it read immediately before Ontario Regulation 52/16 came into force. O. Reg. 52/16, s. 1 (4).

6. Revoked:  O. Reg. 383/04, s. 6.

7. Omitted (revokes other Regulations).  O. Reg. 442/01, s. 7.

8. Omitted (provides for coming into force of provisions of this Regulation).  O. Reg. 442/01, s. 8.

Schedules 1-15 Revoked:  O. Reg. 383/04, s. 7.

Schedule 16
Other Areas

Area

Total Monthly Amount of Rate Protection

Attawapiskat

$53,333.33

Fort Albany

30,000.00

Kaschechewan

50,000.00

O. Reg. 442/01, Sched. 16.