skip to main content
Back to all blog posts

Posted in: Ontario | Practice & Procedure | Ratemaking | Consumer Protection

Feb 17, 2017

Ontario's Minister of Energy Asks LDCs to Stop Winter Disconnections

By David Stevens

On February 16, 2017, Glenn Thibeault (Ontario's Minister of Energy) sent a letter to Ontario's local electricity distribution companies (LDCs) requesting that they voluntarily stop disconnecting customers during the winter season. According to news reports (see here, for example), the Minister has styled it as a request, because he does not believe that he has the power to direct the Ontario Energy Board (OEB) to immediately halt this practice.

It is interesting that the Minister chose to correspond directly with LDCs, rather than dealing through the OEB. It is the OEB that is charged with regulating LDCs. While Hydro One has previously agreed to stop winter disconnections, it is not yet known how other LDCs will respond to the Minister's letter. One can assume that the reason that the Minister is writing directly to LDCs is to seek to get immediate results through public pressure.

Several months ago, the Ontario Government introduced legislation that would address this issue. As we discussed in a prior post, Bill 27 includes new provisions of the OEB Act that would permit the OEB to make rules about times of year when gas and electricity distributors cannot disconnect low-volume consumers. While there are currently protections from disconnections for low-income customers (set out in the Distribution System Code and in the gas distributors' Conditions of Service), Bill 27 would support extending such prohibitions. Bill 27 has passed second reading, and is scheduled for committee hearings later this month. It is clear that the legislation will not be passed in time for the OEB to make new rules that would be effective for this winter season.

Assuming that LDCs do decide to stop disconnecting customers for non-payment during the winter season, either in response to the Minister's letter or in response to new OEB Rules, there will be implications for all customers. Ending winter disconnections will mean that some customers will build up larger unpaid accounts before the LDC can take collection actions. As a result, the bad debt incurred by LDCs will increase. This will cause upward pressure on rates, because bad debt expense is ultimately borne by all customers (it is a utility expense recoverable in rates).

Related Blogs

Posted in: Ontario | Energy Policy | Climate Change / Renewables

Insights EnergyInsider
Ontario Publishes Draft Rules for Cap and Trade “Offset Credits” By David Stevens Oct 17, 2017 Ontario’s Ministry of the Environment and Climate Change (MOECC) has published two proposals related to several new or amended regulations to facilitate linkage of Ontario’s Cap and Trade program with California and Quebec (discussed in an earlier post). The September 22nd proposal d...

Posted in: Ratemaking | Ontario | Facilities

Insights EnergyInsider
OEB Approves Hydro One's Transmission Revenue Requirement, With Some Changes By David Stevens Oct 02, 2017 On September 28, 2017, the Ontario Energy Board (OEB) released its Decision on Hydro One’s transmission revenue requirement for 2017 and 2018. For the most part, the OEB accepted Hydro One’s forecasts and requests, although there are a number of areas where there are differences.

Posted in: Climate Change / Renewables | Consumer Protection | Ratemaking | Ontario

Insights EnergyInsider
Proposed Legislation Would Require Cap and Trade Costs to Be Identified on Ontario Gas Bills By David Stevens Sep 28, 2017 The Transparency in Gas Pricing Act, 2017 passed second reading on September 21, 2017, and has been referred to the Ontario Legislature’s Standing Committee on Finance and Economic Affairs. This proposed legislation, which is sponsored by an opposition party MP, would require that every gas...