September 22, 2016
A Proactive Energy Consumer Charter for Ontario
The Ontario Energy Board (OEB) is considering the development of an energy consumer charter of rights. Here is how the OEB can use this as an opportunity to encourage greater consumer participation in energy markets and regulatory processes in Ontario.
The Ontario Energy Board is considering the development of an energy consumer charter of rights. The energy sector in Ontario, as elsewhere, is undergoing transformative changes, in many cases led by consumers. As such, any consumer charter has to ensure that consumers’ interests are protected, while also empowering consumers to actively participate in the new energy marketplace.
Such a “proactive” consumer charter would set principles and requirements which would give effect to the reasonable expectations of consumers in a dynamic energy environment.
Introduction
The Ontario Energy Board (OEB) has indicated that as part of its “consumer-centric” vision of energy regulation in the province of Ontario, it is interested in introducing an energy consumer bill of rights.1
In earlier research, we identified the importance of consumer engagement on energy issues and the need to have those rights clearly stated.2 The energy market is changing, transforming the role of consumers and increasing the need to ensure that they know both their rights and their opportunities to participate.
In the past, consumers were primarily seen by the sector as passive — ratepayers who would consume energy without much consideration as to how or when it was produced. Now, consumers are becoming more discerning in their energy use, controlling how and when they use energy, and in many cases producing their own energy through such technology as solar PV, selling the surplus back into the grid. In this context, there is an increasing demand for legislators and/or regulators to create a set of energy consumer rights and to enshrine them in a document — the consumer charter.
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As the Board examines the implementation of a consumer charter, it would be instructive to learn from charters in other jurisdictions. To identify best practices and the elements of a well-designed consumer charter, we looked at consumer charters in five jurisdictions — Texas, Ohio, Mississippi, Pennsylvania and Ireland (EU). We also interviewed consumer advocates in Europe, the U.S. and Canada to discover the key issues as they saw them.
Based on this jurisdictional review, we found that consumer rights and consumer charters fall into two main categories: reactive and proactive.
”Reactive” rights are focused on consumers’ relations with utilities, as they concern services. Consumer charters focused on these rights deal with such issues as service standards, consumer billing, disconnection procedures and the way that consumers can complain to a utility respecting perceived shortcomings and errors. In many instances these reactive charters tend to merely restate in plain language pre-existing rights. In Ontario most, if not all, reactive rights are already provided for through legislation or various regulator-imposed Rules and Codes.3
“Proactive” rights are the rights that consumers have in being active participants in the energy market. Proactive consumer charters are therefore more comprehensive, establishing consumers’ rights to engage in the energy market in a more substantive way.
In Ontario, legislation and Board Rules and Codes governing consumers’ relationship with utilities already provide a very effective suite of protections for reactive rights. To be genuinely useful, a consumer charter for Ontario would therefore need to go beyond reactive rights and address consumers’ proactive rights:
- recognize the changing role of consumers, protect them and empower them in a changing market-based environment
- recognize that consumers are no longer all of one single type, and many are making the move from passive to active consumers
- recognize that issues related to energy poverty and climate change are coming into sharper focus.
A properly designed consumer charter will accomplish the dual goal of addressing both reactive and proactive rights: ensure that consumers are protected and informed of their rights in relation to the utility, while ensuring that their broader participation in the energy world is guaranteed, predictable and according to principle.
Mowat Energy’s On the Grid series provides a platform for original thinking about the future of the energy sector in Ontario. The series includes contributions from Mowat Energy, as well as articles or case commentaries authored by interested experts.
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Authors
Paul B. Sommerville
Richard Carlson
Petar Prazic
Release Date
September 22, 2016
ISBN
978-1-77259-033-3
Mowat Research
No. 127
- Ontario Energy Board, Enabling Ontario’s Energy Future: 2015-2018 Business Plan, p. 5. At http://www.ontarioenergyboard.ca/oeb/_Documents/Corporate/OEB_Business_Plan_2015-2018.pdf. [↩]
- See Richard Carlson and Eric Martin, Re-energizing the Conversation: Engaging the Ontario Public on Energy Issues, Mowat Centre, October 2014. At https://mowatcentre.munkschool.utoronto.ca/re-energizing-the-conversation/. [↩]
- This includes the Distribution System Code for electricity distribution, Gas Distribution Access Rule (GDAR) for gas distribution and the Energy Consumer Protection Act for retailers. [↩]
