Ontario Energy Board Issues Guidance on Clean Energy Benefit Under Retailer-Consolidated Billing

The Ontario Energy Board has issued guidance for electricity retailers issuing supplier consolidated bills regarding the Ontario Clean Energy Benefit (OCEB), which provides a 10% reduction in the electric bills paid by all mass market customers regardless of supplier.

The Board established the following dates for downstream reimbursement payments to retailers using retailer-consolidated billing from distributors (who receive the benefit to be disbursed to customers from Minister of Finance via the Independent Electricity System Operator), commencing in February 2011.

Before the 13th business day of each month, licensed distributors that are market participants must make the required payment under the Ontario Clean Energy Benefit to licensed retailers that use retailer-consolidated billing.

Before the 15th business day of each month, licensed distributors that are not market participants must make the required payment under the Ontario Clean Energy Benefit to licensed retailers that use retailer-consolidated billing.

The Board stressed that these downstream payments must be made before the applicable date specified above, and not on these dates. The payments may be effected by way of a set-off in the accounts maintained by the party responsible for making the reimbursement payments.

The Ontario Clean Energy Benefit is to be applied as an amount equal to 10% of the "base invoice amount" for a billing period. The components of the "base invoice amount" are established in the enabling provincial regulation and generally include the commodity price of the electricity, delivery, regulatory charges, the debt retirement charge, provincial benefit/global adjustment (if applicable) and Harmonized Sales Tax.

The Board said that while the elements of the "base invoice amount" are in most respects self-explanatory, "the Board considers it desirable to provide the following guidance in relation to the component identified as the 'commodity price of the electricity:'"

i. The "commodity price of the electricity" includes the final Regulated Price Plan variance settlement amount, whether it is a debit or a credit. Where the final Regulated Price Plan variance settlement amount is a credit to the consumer, the distributor must reduce the amount by 10%.

ii. In the case of a consumer that has a contract with a retailer for an eligible account, the "commodity price of the electricity" should be understood as the contract price. For this purpose, and subject to any exclusions set out in section 3(2) of the OCEB Act, the contract price is all amounts payable by the consumer under a contract with respect to the supply or delivery of electricity other than interest, penalties and cancellation charges or fees, and that that may be settled under the Retail Settlement Code. "To be clear, the contract price is the price identified in the contract and billed to the consumer on account of the commodity, and is not the difference between that price and the wholesale market price," the Board said.

Customers qualifying for the Ontario Clean Energy Benefit are essentially those residential and small commercial customers (< 50 kW) eligible for the Regulated Price Plan.