Hydro One proposes plan to phase out seasonal ratepayer class

Published: February 17, 2021

Hydro Meter Photo by Shutterstock/JWPhotoworks

Ontario cottagers will likely see a change in their hydro bills starting next year.

Last September, the Ontario Energy Board (OEB) tasked Hydro One with eliminating its seasonal ratepayer class. Hydro One’s rate classes determine how much a person pays for hydro depending on their location and usage.

Approximately 148,000 customers are classified as seasonal with nearly half of them being cottagers. A property qualifies as seasonal if it’s a secondary residence where the owner resides for less than eight continuous months a year.

Initially, Hydro One pushed back against the decision, but now it is asking the OEB to phase in the change rather than letting it take effect immediately.

“[The phase in] could start as early as 2022,” said Spencer Gill, Hydro One’s vice president of customer service.

“We’re concerned about the rate impacts of [eliminating the seasonal ratepayer class] for individual customers,” he said. “So, our proposal [to the OEB] is for rates to not increase by more than 10 per cent per year. And that will be phased in over a number of years.”

According to Gill, 55 per cent of the current seasonal ratepayers will see a rate increase, while 45 per cent will see a rate decrease. “What we call the typical customer in this is going to see a 54 per cent rate increase,” he said. “So, that’s $650 a year. But that will be phased in over time.”

The main reason for the increase is that customers who get moved from the seasonal ratepayer class to the residential rate class will not qualify for some of the subsidies available to normal residential customers, Gill said.

At the time of the OEB’s decision in September, Cottage Life spoke with Federation of Ontario Cottagers’ Association (FOCA) president Terry Rees about the change in rate classes. Rees estimated that 78,000 Ontario cottagers could see a rate increase as a result of the elimination of the seasonal ratepayer class.

As cottagers are shifted over to residential rates, Rees said they will be sorted into either medium-density zones or low-density zones. According to Hydro One, a medium-density customer resides in an area that contains 100 customers with at least 15 customers for every kilometre of power line. While a low-density customer is someone who resides in an area not covered by urban high or medium zones.

According to a report released by Hydro One, if sorted into a low-density zone, cottagers could see a rate increase of up to $54 per month.

But the exact rate increase will depend on how the OEB decides to phase in the change. The OEB has firmly stated that the change will be happening and it will not reconsider its decision to eliminate the seasonal ratepayer class. Currently, it is deciding whether Hydro One’s proposed rate mitigation plan is required.

To find out whether you fall under the seasonal ratepayer class, Gill suggested checking your hydro bill. Otherwise, Hydro One is mailing out letters of notification to seasonal ratepayers over the next month.

“I would encourage customers to keep an eye out for the notice in the mail,” Gill said. “It is an invitation for customers to participate in the process and have their say on the implementation of this change.”

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