Hydro One says more than half of its seasonal customers could see a $650-a-year jump in electricity costs after the Ontario Energy Board approved the elimination of a special rate class for seasonal homes.
A spokesperson for the utility told The Highlander that in the coming weeks, the OEB will send out a notice to customers with details on next steps. There will be information on moving customers to one of the three residential rate classes, urban, medium or low density, and the projected bill impacts.
“We anticipate that 55 per cent of our seasonal customers, nearly 80,000 customers, will see an increase in their bills due to moving to the low-density class,” the spokesperson said.
“This change could increase costs for a typical seasonal customer by $650 per year in annual electricity bills.” The spokesperson said Hydro One does not profit from the OEB’s decision, and has advocated for a different solution that would have reduced the bill impact for seasonal customers.
They added Hydro One has submitted an implementation plan to the OEB that proposes rate mitigation measures for customers who are expected to see a total bill increase of more than 10 per cent. Rate mitigation is a tool used by the OEB to protect consumers from having large bill increases at one time – for example, by phasing in the increase over a number of years.
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The OEB has yet to decide whether the change will take effect on Jan. 1, 2022 or later. It will hold a public hearing to determine the implementation plan. No date has been set.
Hydro One is inviting customers to have their say and provide feedback directly to the regulator by visiting oeb.ca or calling 1-877-632-2727.
When asked about internal cuts to save money, the spokesperson said “Hydro One is continually looking inward to improve productivity and take costs out of the system. In 2019, we saved $202 million in productivity savings, which allows us to drive costs out of the system and enhance efficiency.”
In making the decision the OEB said its concern was that the distribution rates charged to seasonal customers are not reflective of the cost to serve them.
It said, “The OEB was aware that eliminating the seasonal class would cause bill impacts for Hydro One’s seasonal customers, and particularly would cause bills to increase for lower-use seasonal customers. The OEB directed Hydro One to bring forward a bill mitigation plan.”
The Federation of Ontario Cottagers’ Associations (FOCA), in a Feb. 9 update to members, said the change affects almost 80,000 low-use customers, who will see their monthly bills increase by $50-plus a month.
“FOCA has been an intervenor at the OEB for many years, and has been advocating against this significant bill impact,” they said.
FOCA is preparing to launch a campaign to stop the elimination, “because this change will result in the doubling of electricity rates for nearly 80,000 seasonal Hydro One customers and cottage owners.”
Long-time Kennisis Lake cottager, Tony Lepine, is worried about the impact.
He said it costs him about $100 every winter for hydro when he’s not there — mostly for the delivery charge.
With the change, he estimates his bill will go up by $60-70 a month, or about $720-a-year.
“That’s a lot of money.”
Lepine said he will still use his cottage, but is considering going off-grid, noting that option is costly as well.
“I’m retired and there’s no way my pension will increase that much,” he said. “I’m lucky to get two per cent per year. This is a significant increase.”
FOCA is encouraging people to sign up for FOCA’s new dedicated electricity e-newsletter, called The Power Line. S
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