Hydro utilities lag in plans for new market, board says

John Spears
Toronto Star
July 25, 2001

Many local utilities are months behind schedule preparing for Ontario’s new competitive electricity market, according to the Ontario Energy Board.

In a letter to utilities sent yesterday, the energy board (OEB) said it is extending a key deadline by four months because so few utilities are on schedule.

Even with the four-month delay, the board said the market should still be able to open by the May, 2002 target date set by the provincial government.

However, it would appear to dash hopes that the market could open earlier than next May, as the province would have liked.

The letter from energy board secretary Paul Pudge said the board has reviewed questionnaires submitted by local utilities about their state of readiness for a competitive market.

The market will change the utilities’ current practice of buying almost all their electricity from Ontario Power Generation, one of the remnants of the old Ontario Hydro, and selling it under a single rate schedule.

With the new market, many generating companies will be selling power. Some will sell direct to large customers and others to retailers who then will resell to house and apartment dwellers.

Local utilities will need complex systems to track who is delivering power, who’s buying it, and at what price. Those systems were supposed to be tested by Aug. 10.

“The results of this review indicate that only a few distriubutors are on track with the current market readiness plan,” the board letter said.

“The assessment of other distributors’ filings indicates that a large number, representing the bulk of the consumers, are behind schedule.”

Because so many are unprepared, the board is extending the deadline for testing until Dec. 14. After that, it hints, it may consider fining the laggard utilities.

Tom Adams, executive director of Energy Probe, termed the new delay “bad news, but not fatal.

“It is an indication of some of the chaos going on within the ranks of the distribution utilities,” he said.


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