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Hydro One seeking five years of rate increases

Ontario Energy Board in early stages of reviewing rate increase request
Hydro Crew
Representatives from both the Ontario Energy Board and Hydro One were in Sudbury on June 28 to discuss a Hydro One's application to increase distribution rates over the next five years. Contained in Hydro One's request are increases that will impact hydro bills for the next five years, starting with an increase of $2.79 per month as of January 2018.

Representatives from both the Ontario Energy Board and Hydro One were in Sudbury on June 28 to discuss Hydro One's application to increase distribution rates over the next five years.

Contained in Hydro One's request are increases that will impact hydro bills for the next five years, starting with an increase of $2.79 per month as of January 2018.

This is not to be confused with having your bill increase by nearly $3 every month from there on, but rather the average customer who uses 750 kWh per month, their delivery cost each month in 2018 will be $2.79 higher than in 2017. 

The recently passed Fair Hydro Act, 2017 would result in customers actually seeing the total bill amount come down despite a delivery charge increase, however, the Fair Hydro Act credits are only slated to be in effect for four years.

Hydro One's proposed plan would see the average hydro delivery charge go up by nearly $13 between 2018 - 2022, and in the final year of the proposed increases, the Fair Hydro Act will no longer be in place, resulting in what could be some staggering spikes in people's hydro costs.

Oded Hubert, vice president of regulatory affairs with Hydro One was at the public meeting at the Parkside Centre on Wednesday evening to explain the reasoning behind the proposed increases.

"About 25 per cent of our poles are at or nearing the end of their lifespan," said Hubert. "280,000 of our 1.6 million poles are at or beyond their expected service life as of this year and another 120,000 will reach their expected life within the next five years."

Hydro One will not be replacing all of the poles, and as Hubert said, "when a pole hits 62 years of use, it doesn't just fall over," but the company still has to monitor them and do condition testing to ensure that they can efficiently deliver power.

The Ontario Energy Board has just begun reviewing Hydro One's rate application and the review will take roughly a year. In the meantime, the OEB is holding public meetings around the province to get feedback from customers, stakeholders, and other interested parties. 

"Because hydro companies are non-competitive monopolies, the OEB's role is to be a proxy competition and put downward pressure on these companies to monitor price, reliability and quality service," said Kristi Sebalj, senior legal counsel, OEB. 

"We also need to balance that with ensuring that we have a financially viable energy sector."

When applications for rate increases like this come in, the OEB audits the requests to ensure that companies like Hydro One are doing everything possible to be more efficient and keep improving.

Sudbury was the eighth of nine stops in the series of public meetings, but Sebalj urged those in attendance to stay up to date and stay in contact with the OEB with any questions or concerns they have regarding Hydro One's application.

To get involved in the OEB's rate review process visit www.oeb.ca/consumervoice, or click here to learn more about Hydro One's distribution rate application.


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