Regulation - LGIC
Proposed Amendment to O. Reg. 24/19: EXPANSION OF NATURAL GAS DISTRIBUTION SYSTEMS
Regulation Number(s):
24/19
Instrument Type:
Regulation - LGIC
Bill or Act:
Ontario Energy Board Act, 1998
Summary of Decision:
Effective March 10, 2023, O. Reg. 24/19 - Expansion of Natural Gas Distribution Systems was amended to reflect the changes in the project scope and costs regarding the Hamilton Regional Airport Expansion Project (the Project). The amended regulation will reduce the total funding amount of the Project from $10,331,404 million to $2,637,053 million.
Analysis of Regulatory Impact:
N/A
Further Information:
O. Reg. 36/23: EXPANSION OF NATURAL GAS DISTRIBUTION SYSTEMS (ontario.ca)
O. Reg. 24/19: EXPANSION OF NATURAL GAS DISTRIBUTION SYSTEMS
Proposal Number:
23-ENDM017
Posting Date:
Summary of Proposal:
The Ministry of Energy made an amendment to O. Reg. 24/19 - Expansion of Natural Gas Distribution Systems. The amendment is a "technical change" to the regulation to adjust the prescribed Natural Gas Expansion Program (NGEP) funding amount of the Hamilton Airport Regional Expansion Project as a result of a scope change and reduction in the project budget.
NGEP was established under the Access to Natural Gas Act, 2018, which amended the Ontario Energy Board Act, 1998. These amendments made it possible to implement a new program to fund natural gas distribution projects that would otherwise be uneconomic to construct, in order to bring lower cost natural gas to rural, northern Ontario, and First Nation communities. The primary objective of the Program is to enable more affordable options for home heating in rural, northern, and Indigenous communities.
NGEP provides funding for projects to allow natural gas distribution system expansion where such expansion is otherwise uneconomic. O. Reg. 24/19 describes the funding collection and disbursement mechanism under Phase 1 and 2 of NGEP. The schedules to the regulation also specify the projects authorized to receive financial support ("qualifying investments") and respective funding amounts (noted in the schedules to the regulation as "maximum amount of rate reduction") for each project.
Currently, the regulation only provides a mechanism for the release of the full amount allocated to each prescribed project, which are noted in Column 3 of Schedules 1 and 2 of the regulation, except where the full amount of funding has not yet been collected through the $1 per month charge on natural gas consumers. The $1 per month charge is authorized through amendments to the Ontario Energy Board Act, 1998 and the associated O. Reg. 24/19, which designates the Independent Electricity System Operator (IESO) as the settlement agent.
The amendment enables the program to avoid an overpayment and subsequent accounting challenges to recover such an overpayment from the proponent in future.
NGEP was established under the Access to Natural Gas Act, 2018, which amended the Ontario Energy Board Act, 1998. These amendments made it possible to implement a new program to fund natural gas distribution projects that would otherwise be uneconomic to construct, in order to bring lower cost natural gas to rural, northern Ontario, and First Nation communities. The primary objective of the Program is to enable more affordable options for home heating in rural, northern, and Indigenous communities.
NGEP provides funding for projects to allow natural gas distribution system expansion where such expansion is otherwise uneconomic. O. Reg. 24/19 describes the funding collection and disbursement mechanism under Phase 1 and 2 of NGEP. The schedules to the regulation also specify the projects authorized to receive financial support ("qualifying investments") and respective funding amounts (noted in the schedules to the regulation as "maximum amount of rate reduction") for each project.
Currently, the regulation only provides a mechanism for the release of the full amount allocated to each prescribed project, which are noted in Column 3 of Schedules 1 and 2 of the regulation, except where the full amount of funding has not yet been collected through the $1 per month charge on natural gas consumers. The $1 per month charge is authorized through amendments to the Ontario Energy Board Act, 1998 and the associated O. Reg. 24/19, which designates the Independent Electricity System Operator (IESO) as the settlement agent.
The amendment enables the program to avoid an overpayment and subsequent accounting challenges to recover such an overpayment from the proponent in future.
Contact Address:
77 Grenville St., 6th Floor Toronto, ON M7A 2C1
Effective Date:
March 10, 2023
Decision:
Approved