Proposed Amendment to Ontario Regulation 442/01 (Rural or Remote Electricity Rate Protection)
Regulation - LGIC
Bill or Act:
Ontario Energy Board Act, 1998
Summary of Decision:
The Ministry of Energy has finalized amendments to Ontario Regulation 442/01 (Rural or Remote Electricity Rate Protection) under the Ontario Energy Board Act, 1998. These changes enable partial funding of a key priority of the Ontario Government's 2013 Long Term Energy Plan: the connection of remote First Nation communities to the provincial transmission grid.
The amendment took effect on July 1, 2016. A link to the official regulation is provided in the "Additional Information" section of this notice.
The Ministry of Energy received comments that were generally supportive of the regulatory amendments as a step to advance the connection of remote First Nation communities to the Ontario electricity grid. Several comments noted that the proposal did not create a mechanism for funding the connection of communities served by Independent Power Authorities that do not currently receive Rural or Remote Electricity Rate Protection (RRRP). The Ministry of Energy acknowledges the importance of connecting all 21 remote communities that are economical to connect and will take steps to enable project funding for these communities in the future. Changes to Ontario Regulation 442/01 to apply RRRP to these communities were not made at this time because they require an Ontario Energy Board-licenced distributor to serve the community and the conclusion of an agreement for cost sharing with the federal government. The Ministry of Energy continues to engage with communities, Independent Power Authorities, other stakeholders, and the federal government on these matters.
In response to a request from a commenter, the posting period was extended for this proposal.
February 10, 2016
Summary of Proposal:
Amendments to O.Reg. 442/01 are proposed to enable the partial funding of the project to grid-connect remote communities and reduce the use of diesel generation. The amendments would allow RRRP to be used to cover a portion of the costs required to build and operate the lines that would connect remote First Nation communities to the transmission grid. This would include costs associated with a new transmission line to Pickle Lake and upgrades to existing transmission infrastructure between Dryden and Red Lake which are needed to support the connection of the remote communities, as well as lines needed to connect the communities.
The proposed amendments would also expand the definition of remote area to include communities that become grid-connected. Without making this change, communities that become connected would no longer receive RRRP.
Since RRRP can only be collected by licensed distributors regulated by the OEB, the proposed amendments will only apply to grid connection infrastructure needed to connect the 12 communities currently served by RemoteCo that are considered economical to connect. Ontario's objective is to facilitate the connection of all communities where it is economical to do so, including the nine that are currently served by independent power authorities (IPAs). A significant portion of the lines needed to connect communities served by RemoteCo and by IPAs would be shared infrastructure, and the proposed regulatory amendments to O. Reg. 442/01 are a first step to enable cost recovery for the project. As the remote connection project evolves, future regulatory amendments may be proposed to support RRRP funding for additional communities.
Any industrial or other customers that propose to share use of the new or upgraded infrastructure would continue to contribute to costs as outlined in the Ontario Energy Board's codes.
March 8, 2017