Does the 8% Rebate for Ontario Electricity Consumers Include My Municipality?

Posted: January 31, 2017
Tagged As: Electricity, Energy Planning

In September 2016, as part of their Speech from the Throne, the Ontario Government committed to introduce legislation that would provide an electricity rebate for Ontario consumers that is equal to the provincial portion of the Harmonized Sales Tax (HST). This is effectively an 8% savings intended to provide cost relief to consumers. This seems simple enough, but exactly which electricity accounts are captured under this initiative? What is a consumer, and does this include municipal accounts?

Since the government introduced the Ontario Rebate for Electricity Consumers Act, 2016, LAS has been working diligently to understand the details of this rebate and how it applies to municipal electricity accounts. We want to help municipalities as they work through their 2017 energy budgets, which coincided with the start of this rebate at January 1, 2017.  
 
In the Throne Speech, the government noted that the rebate was to provide relief “directly on consumers’ residential electricity bills.”  However, this rebate is actually applicable to a broader range of accounts than just residential ones.

The Rule

The 8% rebate is applied by your Local Distribution Company (LDC) – such as Hydro One - based on the account service type, as well as some other criteria.  This means many smaller municipal accounts will likely receive the rebate.  Any account that bears similarities to a residential account – i.e. annual demand less than 50 kW or annual consumption less than 250,000 kWh – should receive it.  At LAS, we call these accounts “the rule,” as there is no need for a municipality to do anything to receive the rebate for these account types, and the rebate should be applied automatically to your bill. 

Still not sure?  LDCs have noted that any accounts that historically received the Ontario Clean Energy Benefit (OCEB) in 2015, or had a Debt Retirement Charge (DRC) exemption, will also qualify for this 8% rebate, as the eligibility criteria for the various rebates/exemptions are similar.  If you are uncertain about the eligibility of any of your accounts for the rebate, you should connect with your LDC, and ask. It could save you 8% on your electricity bill!

The Exceptions

What about “exceptions” to the rule?  There are municipal accounts that fall outside of the above criteria, but may still qualify for the 8% rebate.  The problem is that some of these accounts are not as easily identifiable by your LDC as those falling under “the rule.” So you may receive a letter from the LDC asking for your assistance in identifying the account’s purpose. Don’t forget to respond to these LDC letters as you may be leaving money on the table.

Based on the legislation and inquiries with the Ministry of Energy, the rebate will be for residences, farms, and small businesses (including some municipal accounts). In addition to the account types noted earlier, the rebate would also be applicable to the following: 
  • a property, within the meaning of the Condominium Act, 1998
  • a residential complex, within the meaning of subsection 2 (1) of the Residential Tenancies Act, 2006
  • a property that includes one or more housing units and that is owned or leased by a co-operative within the meaning of the Co-operative Corporations Act.
We suggest that municipalities look at their LDC invoices in the coming months to see which accounts are receiving the 8% rebate for 2017 usage.  If there is an account that is not getting the rebate, but which you feel should be entitled based on the noted criteria, we encourage you have a conversation with your LDC to confirm.
If you have any questions about the rebate, but cannot connect with your LDC, we would be pleased to help guide you.
 
Summary points of the 8% Rebate:
  • It is applied to the base amount on an electricity invoice, and includes commodity, rates, charges, and any debt retirement charges, but excludes HST.
  • The rebate will be a separate line item on your electricity bill
  • The rebate can be applied by your LDC after January 2017, but the rebate would be retroactive back to January 1.
  • You can apply for the rebate retroactively, so it is never too late to ask your LDC if your municipal account qualifies.

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