Happy New Year! We’re excited to bring you the latest edition of the Shepherd Rubenstein Energy Regulatory Update, a comprehensive quarterly summary of the incredibly busy period in Ontario's energy sector. This issue highlights the flurry of regulatory activity and significant developments from October to December (and the first few days of January).
If you missed it, don’t forget to explore our special 2024 Year in Review edition, where we reflect on the major trends and milestones that shaped a dynamic and fast-paced year for energy policy and regulation in Ontario.
Ontario Energy Board
The OEB issued several notable decisions over the last few months, including:
- Approving the comprehensive Settlement Proposal for Toronto Hydro’s 2025-2029 Custom IR rate application. In a separate decision on the lone unsettled issue, the OEB rejected Toronto Hydro’s proposed Innovation Fund, citing several deficiencies.
- Approving the partial Settlement Proposal for Phase 2 of Enbridge Gas’s 2024-2028 rate application, which represented a substantial agreement on the company’s 2025-2028 incentive rate framework, as well as issues related to natural gas storage.
- Granting Enbridge Gas’s application for an exemption from the requirement for leave to construct its Overlea Station Relocation project, finding that there were special circumstances under section 95(1) of the Ontario Energy Board Act.
- Approving Settlement Proposals in each of the five-year rate applications brought by B2M LP, Niagara Reinforcement LP, and Chatham x Lakeshore LP, establishing a new revenue requirement framework for single-asset transmitters.
In late December, the Minister of Energy and Electrification issued a new Letter of Direction to the Chair of the OEB for the upcoming year. The Letter of Direction sets out the Minister’s expectations and priorities for the OEB. These include, among others:
- Providing input on the province’s Integrated Energy Plan (as well as plan implementation).
- Implementing of the Keeping Energy Costs Down Act.
- Considering how the ‘beneficiary pays’ principle can best be modified or applied to ensure:
i) transmission/distribution infrastructure decisions account for probable future users, early and later beneficiaries, and other ratepayers, ii) utilities and their shareholders are kept whole, and iii) the potential for wasted costs or under-builds is minimized to protect ratepayers. - Work related to conservation and demand management, including: i) collaborating with the IESO and Enbridge to deliver a customer-focused, one-window platform for energy efficiency programs, ii) proposing an appropriate cost-sharing mechanism between the Global Adjustment and distribution rates, to fund the development and operation of new energy efficiency programs that provide both system and local distribution benefits, and iii) reducing barriers to LDC energy efficiency program activities.
- Advancing work on electricity distributor reliability and resilience, non-wires alternatives, and regulatory efficiency.