Enhancements to Ontario’s Net Metering Framework
The Province’s 2017 Long-Term Energy Plan (LTEP) commits to enhance Ontario’s net metering framework to give customers new ways to participate in clean, renewable electricity generation. In accordance with this commitment, the Ministry of Energy intends to expand net metering eligibility to include new ownership models and to ensure appropriate consumer protection provisions and siting restrictions are in place.
Legislative amendments to the Ontario Energy Board Act, 1998, required to expand the scope of eligible net metering ownership models, were tabled on November 14, 2017 through Bill 177, Stronger, Fairer Ontario Act (Budget Measures), 2017. Pending the passing of the proposed legislative amendments, the Ministry of Energy intends to propose regulatory changes to enable these new ownership models, as well as other regulatory measures in support of an expanded and enhanced net metering framework, as follows:
• Enable third-party ownership of net-metered generation facilities and virtual net metering demonstration projects;
• Adapt and enhance the existing energy consumer protection framework to support the introduction of third-party ownership arrangements; and
• Ensure that prescribed types of renewable energy generation facilities are sited appropriately.
The Ministry of Energy invites input on this regulatory proposal and corresponding regulatory proposals (posted separately and linked in the Additional Information section of this posting) to inform changes to Ontario’s net metering framework.
A plain language description of the proposed regulation follows:
Ensuring Appropriate Consumer Protections
In accordance with commitments made in the Province’s 2017 Long Term Energy Plan (LTEP), the Ministry of Energy is proposing to amend O. Reg. 389/10 (General) to be made under Ontario’s Energy Consumer Protection Act, 2010 to support the introduction of third-party ownership arrangements under Ontario’s net metering framework.
The Ministry of Energy is proposing to adapt and enhance the existing consumer protection framework to cover a new type of energy retailer activity related to Third Party Owners (TPO) participating in net metering. The proposed amendments would address matters arising out of TPO retailers and customers entering into electricity retail agreements for electricity generated from renewable energy generation facilities located behind a customer’s meter. The proposed amendments address only the part of the arrangement that relates to the sale of electricity by the TPO retailer to the customer.
With some exceptions, most of the existing provisions of the energy consumer protection legislation and regulation are suited to the activities of TPO retailers who would be generating electricity from renewable energy generation facilities located behind the meter of a customer and selling that electricity to the customer. This includes the existing, stringent disclosure requirements that apply to contracts between electricity retailers and customers for the sale of electricity.
To ensure consumer protection measures are adapted to the TPO retailer activity, the following revised requirements are proposed:
The retailer would be required to disclose where there are any other associated contracts, and whether cancellation of the retail agreement could trigger cancellation or termination penalties in the other contracts. Any such penalties would also be required to be disclosed.
2. Unfair Practices
Failure to clearly disclose to a customer (i) if there are any contracts involving generation equipment associated with a retailing agreement and (ii) if those associated contracts have cancellation or termination penalties would be an unfair practice.
Cancellation in the event of a customer moving would continue to be permitted. However, any potential penalties or fees in any associated agreement that could be triggered by the cancellation of the retailing agreement would be required to be clearly disclosed to the customer.
4. Return of Equipment
Under certain circumstances, a customer who cancels a retailing agreement would not be entitled to retain any associated equipment. Stipulations of any cost associated with returning this equipment (dismantling, recovery etc.) would be required to be disclosed to the customer.
Other Proposed Regulatory Changes
The Ministry is also considering including in a separate regulatory proposal, the use of contractual provisions, additional requirements of connection agreements and additional disclosure requirements that must be complied with by TPOs, generators and others engaged in the new net metering arrangements being contemplated. Stakeholders are advised to review the associated regulatory proposal posting for amendments to O. Reg. 541/05: Net Metering, listed in the Additional Information section of this posting.