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Ontario Energy Board needs overhaul to boost public trust, new report says

Ontario's energy regulator is in need of an overhaul to strengthen public trust in its work and better adapt to technological change, a government-appointed panel says in a report being issued this week.

OEB sets rules for energy companies and establishes rates that consumers pay

The three-member panel tasked with reviewing ways to bolster the performance of the Ontario Energy Board recommends it should have more independence, streamline rate change applications and adapt to better address technological changes in the energy sector. (Colin Perkel/Canadian Press)

Ontario's energy regulator is in need of an overhaul to strengthen public trust in its work and better adapt to technological change, a government-appointed panel says in a report issued this week.

The three-member panel tasked with reviewing ways to bolster the performance of the Ontario Energy Board recommends it should have more independence, streamline rate change applications and adapt to better address technological changes in the energy sector.

"Taken together, these recommendations identify opportunities to improve confidence in Ontario's regulatory system and point towards opportunities to strengthen public trust," said the report, which was released on Friday.

The OEB sets rules for energy companies and establishes rates that consumers pay.

The previous Liberal government launched a sweeping review of the board in December 2017 and the work was paused after the new Progressive Conservative government took power last June.

Energy Minister Greg Rickford re-constituted the Ontario Energy Board Modernization Review Panel last August. It has been led throughout by Richard Dicerni, the former head of Ontario Power Generation.

The panel recommended the OEB appoint its own board of directors and establish a chief commissioner to oversee regulation. Those measures will help ensure it is recognized as making fair and impartial decisions, the panel said.

"Reforming the governance structure is a solid first step toward improving trust and confidence in the regulatory system," the report said.

The group also suggested the regulator streamline its review of rate change applications. It noted that the OEB should process its case work "on a dependable timeline" and clearly communicate requirements, status, and milestones.

"Participants need more certainty as to what they can expect from regulatory processes," the report said. "Providing this certainty is a significant component of building public trust."

The panel further recommends the board develop a plan to address the energy sector's needs as technological change continues. Those "disruptive forces" — which include the move towards electric cars, customers generating their own electricity, and energy storage batteries becoming more affordable — will change the markets the OEB regulates.

"The resulting new business models, changing consumer expectations, and increased interconnection between the energy system and the broader economy will require the OEB to adapt its policies, governance and practices to continue to serve the public interest," the report said.

It also said the board should change its name to the Ontario Energy Regulator, adding that the name reinforces that "prudent regulation" is a core purpose of the agency.

Government 'carefully considering' recommendations

A spokesman for Rickford said the government is reviewing the document.

"We're carefully considering all recommendations within the report," Brayden Akers said in a statement.

In November, in a speech before the Association of Power Producers of Ontario, Rickford expressed a desire to make changes at the OEB as part of the government's promise to slash hydro rates by 12 per cent.

The OEB plays a crucial role as a regulator but had not been reviewed for years, he told the group.

"As we find ourselves in the digital age where advancements in technology are bringing about an unprecedented amount of change and transformation, consumer expectations for service delivery are higher than ever," he said. "We need the OEB to be a top tier regulator that responds in this environment."

The OEB said it would provide comment on the report when it is released.

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