Keeping Penalties off Rates

Regulation Number(s):
Instrument Type:
Bill or Act:
Ontario Energy Board Act, 1998
Summary of Proposal:
The Government is committed to ensuring critical infrastructure is built as soon as possible while protecting energy ratepayers from paying for penalties or fines imposed on an electricity or gas transmitter or distributor that has failed to comply with requirements arising from its statutory obligations.
The OEBA currently includes statutory provisions to exclude certain penalties or fines arising from the Building Transit Faster Act, 2020 and the Building Broadband Faster Act, 2021 from being included in the fixing of just and reasonable rates for electricity or gas transmitters or distributors. O. Reg. 14/23 (Administrative Penalties) made under the Ontario Underground Infrastructure Notification System Act, 2012 will apply to electricity and gas transmitters and distributors as of April 1, 2023.
The proposed amendments would make it clear that fines imposed under an Act or regulation are not to be recovered through rates. The proposed amendments to the OEBA reflect the Government's goal of ensuring ratepayers do not pay for an electricity or gas transmitter or distributor's failure to comply with its statutory obligations. The proposed amendments are also intended to further incentivize electricity or gas transmitters or distributors to appropriately prioritize those works where the Government has established a penalty regime.
The proposed amendments would, if passed, also introduce regulatory powers to exempt certain penalties and fines from this provision and to expand the list of prohibitions to cover other amounts if it is in the interest of Ontario.
Analysis of Regulatory Impact:
There are no direct compliance costs expected with this proposal. If the proposed amendments are passed, electricity and gas transmitters and distributors would be expected to become familiar with this legislative amendment which may result in administrative costs that are expected to be negligible.
If passed, this amendment would help keep rates predictable and low, supporting all Ontarians and businesses. Energy affordability would in turn support economic development for businesses and savings for Ontarians.
Responses to this posting that describe the qualitative or quantitative impact of this proposal will inform a final regulatory impact analysis.
Further Information:
Proposal Number:
Posting Date:
April 3, 2023
Comments Due Date:
May 18, 2023
Contact Address:
Ministry of Energy
77 Grenville Street, 6th Floor, Toronto ON M7A 2C1