In a controversial move, Ontario’s Premier Doug Ford’s government has pushed through the Keeping Energy Costs Down Act, overriding the decision of Ontario’s independent energy regulator. This legislation grants the provincial government the power to countermand the Ontario Energy Board’s (OEB) ruling that had denied Enbridge the ability to finance a major gas expansion through long-term rate increases on current customers.
Effectively, this move sidelines the regulatory independence of the OEB, allowing the government to intervene in decisions it opposes. The rationale behind Ontario’s decision stems from disagreement with the OEB’s recent rejection of Enbridge’s proposed 40-year payment plan to fund new gas pipelines and infrastructure using customer rates. The OEB cited concerns about the plan’s failure to account for the evolving energy landscape and its potential to burden the public with obsolete infrastructure costs well into the 2060s. Instead, the OEB mandated that developers bear the upfront costs of new infrastructure, rather than transferring the burden onto existing ratepayers.
Following the release of the OEB decision, Ontario Energy Minister Todd Smith promptly announced the province’s intention to overturn the board’s ruling, citing concerns about potential increases in housing costs. Contrary to this assertion, experts informed Canada’s National Observer that the decision could, in fact, decrease home ownership expenses, as high-efficiency heat pumps offer a more cost-effective lifecycle compared to gas furnaces.
David Donovan, currently serving as Smith’s chief of staff, previously held the position of Enbridge’s senior government affairs strategist from 2013 to 2018 before transitioning to the Ontario government.
Despite requests for comment, Smith’s office remained unresponsive.
Enbridge expressed satisfaction with the legislative success, commending the Ontario government for passing the bill and emphasizing the importance of gas in Ontario’s energy transition strategy. However, the company acknowledged that further efforts are necessary. According to Enbridge, the OEB’s decision reflects a bias against natural gas and includes provisions hindering the company’s ability to support and expand gas utilization in Ontario.
Enbridge also asserted that expanding its gas business in Ontario contributes to emissions reduction, although this claim has been disputed. Natural gas, primarily composed of methane, poses significant environmental challenges and must be curtailed to meet international emission reduction targets.
Ontario Green Party Leader Mike Schreiner condemned Ford’s government for prioritizing Enbridge over the interests of Ontarians. In a statement, Schreiner criticized the passing of legislation that perpetuates reliance on costly fossil fuels, particularly as the province grapples with the impacts of wildfire smoke from Alberta and British Columbia.
Schreiner urged the government to reconsider its stance, emphasizing the importance of respecting the Ontario Energy Board’s independent decision to safeguard consumers. He called for the repeal of the legislation and an end to the allocation of ratepayer funds to support fossil fuel companies.
Earlier, Schreiner, along with environmental advocacy groups, had urged the Ontario Auditor General to investigate the government’s efforts to overturn the OEB decision. At Queen’s Park last week, Ontario NDP critic for energy and the climate crisis Peter Tabuns accused the Ford government of leaving Ontarians vulnerable to Enbridge’s exploitation, likening customers to “an ATM” for the company.
“This is straight out of this government’s Greenbelt playbook: decisions made in back rooms to protect powerful private utilities; not to protect you, not protect the Enbridge customers who are out there, not to protect the constituents who you represent, but to protect Enbridge,” he said.
