Monday deadline to oppose 24% hike for hydro

Hydro Ottawa customers have only until Monday to act if they want to oppose the utility’s request for a double-digit increase in electricity distribution charges at an upcoming Ontario Energy Board hearing.

Hydro Ottawa has applied for an increase in distribution charges totalling nearly 24 per cent for residential customers over five years, starting in 2016. Those charges account for about one-fifth of a typical monthly hydro bill.

If approved by the OEB, the increase would raise the monthly cost for an average residential customer from $28.39 to at least $35.15 by 2020. Business rates would rise even more.

The largest increase for residential customers — $2.42 a month, or more than nine per cent — would be in 2016, with monthly increases of $1.44 in 2017 and $1.29 in 2018.

For now, Hydro Ottawa is proposing smaller increases in 2019 and 2020, but the utility says those are subject to change and won’t be finalized until the fall of 2018.

The OEB will hold a hearing into Hydro Ottawa’s rate request at a date yet to be determined. It has not yet decided whether to hear oral presentations or accept only written submissions.

To become an active participant in the hearing, groups or individuals must apply for intervener status by June 8. As of Wednesday, only one organization — Energy Probe — had formally applied, according to the OEB’s website.

The website includes just a single letter of objection from an individual, Ottawa resident Ron Eade, a former food writer for the Citizen.

Eade’s letter calls the rate increase “completely unwarranted” and describes a survey commissioned by Hydro Ottawa that shows widespread acceptance of it by the majority of Ottawans as “utterly self-serving as questions are designed to deliver the intended result.”

The Innovative Research Group telephone survey of 1,036 residential customers found that 23 per cent thought Hydro Ottawa’s proposed rate increase was reasonable. Another 47 per cent said they didn’t like it but thought it was necessary.

Innovative Research says the findings mean that Hydro Ottawa has “social permission” from 70 per cent of its residential customers for its rate increase. The comparable “social permission” number for business customers was 66 per cent.

The residential survey has a margin of error of three percentage points, 19 times out of 20.

Support was lower among residential customers who participated in online research. Even so, 10 per cent supported the increase, and 40 per cent thought it was necessary even though they didn’t like it.

Hydro Ottawa laid out its case for the increase in voluminous filings with the OEB about a month ago.

It said about 30 per cent of its assets have reached or exceeded their expected useful life, requiring average annual capital investments of $130 million a year between 2016 and 2020.

By contrast, the utility’s average capital spending between 2006 and 2009 was $75 million.

Hydro Ottawa is also girding for a massive turnover in its workforce, with 43 per cent eligible to retire over the next five years. That will require multi-year training and apprenticeships, it told the OEB.

Ottawa winters are another challenge, the utility says. Snow and ice impede work flow, frozen ground shortens the season for infrastructure work, and road salt corrodes ductwork, wires and insulators.

There’s also a shortage of qualified contractors in Ottawa, forcing the utility to pay a premium to attract contractors from Toronto. And rising electricity rates have generated customer expectations for new and improved services that Hydro Ottawa must meet in an “innovative, agile and timely manner.”