Rate Design for Electricity Distributors (formerly Revenue Decoupling for Distributors)
November 26, 2012
As part of the
Renewed Regulatory Framework in Electricity, the OEB indicated that the revenue decoupling consultation would move forward.
The OEB believes that distributors should have a rate design that provides greater stability for the consumer and sends a price signal to consumers that links use to cost drivers. An appropriate rate design will link the consumer’s use to distributor planning and provide the revenue stream that will allow the distributor to make necessary investments.
This initiative builds on extensive work and consultations previously undertaken by the OEB.
Related policy initiatives:
Rate Design Working Group:
The OEB formed a Rate Design Working Group (RDWG) to assist in developing guidance for the implementation of fully fixed distribution charges for residential customers in Ontario.
List of Member Organizations:
Consumers Council of Canada
Hydro One Networks Inc.
Midland Power Utility Corporation
Toronto Hydro-Electric System Ltd.
Veridian Connections Inc.
Wasaga Distribution Inc.
Vulnerable Energy Consumers Coalition
Issue / Document
July 16, 2015
The OEB has issued a letter outlining details regarding the implementation of the transition to fully fixed distribution charges for residential customers.
April 2, 2015
The OEB has issued its policy on fully fixed distribution charges for residential customers. This is an important step in the ongoing evolution of the electricity sector in Ontario.
Benefits to Consumers: The rate change will focus conservation on the most appropriate portion of the bill, the Electricity line and customers will continue to receive strong conservation signals.
Residential customers will be able to leverage new technologies emerging in their local market.
Most customers will not see a significant change in their bill. A phased-in implementation schedule over 4 years will smooth rate impacts.
Customers who have cost-intensive electric heat, many of whom are low-income, stand to gain from this change.
For now, the bill will look the same but will more accurately reflect the true cost of power delivery and production.
This will not change how much money a distributor collects, only how they collect it and increases customer understanding of rates.
Benefits to Utilities: Distributors will be able to ready their grids for smart grid and green energy initiatives in a way that sustains their financial stability.
They will have the financial stability to plan their short- and longer-term budgets and manage a reliable distribution system.
This change is revenue neutral for local distributors
July 8, 2014
The following parties have provided written comments in the above matter.
June 3, 2014
The Board has posted staff notes from meetings with stakeholders on the Draft Report of the Board.
April 3, 2014
The Board issued the Draft Report of the Board on Rate Design for Electricity Distributors.
November 26, 2012
The Board issued a letter announcing a new consultation project to complete the work on Revenue Decoupling for Distributors.
Rate Design Working Group
Cost Award Matters