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Toronto Hydro billing practice being reviewed by Ontario Energy Board

Toronto Hydro hits homeowners with new fees
WATCH ABOVE: Toronto Hydro hits homeowners with new fees. Sean O'Shea reports.

A new fee Toronto Hydro has levied against customers is being reviewed by the Ontario Energy Board, the province’s energy regulator. 

On March 1, Toronto Hydro – the province’s second largest utility company – began charging customers for disconnecting power at their homes when performing routine maintenance and repairs. According to one electrician, who says Toronto Hydro has asked for as much as $2,100 to perform this service, this change is causing some customers to rethink important work and putting their safety at risk.

“Jobs can change from $1,000 to $3,200 overnight just for a disconnection-reconnection,” said Mark Burton, a master electrician and owner of Burton Electric.

“People are not going to be able to afford the disconnection. So now they’re gonna start taking chances with their life and their property as well as their neighbours.”

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Traditionally, the cost of this service has been covered by the per kilowatt-hour rate all customers pay to Toronto Hydro – a rate approved by the Ontario Energy Board.

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But Toronto Hydro changed this policy last month after a review of recent data revealed the company received more requests for customer isolation than anticipated. The review also revealed “concerns” with the way costs were being recovered.

According to Toronto Hydro, all ratepayers were “subsidizing” the cost for a small number of customers who accessed the service each year.

“We performed approximately 11,000 customer-requested isolations in 2016,” said Tori Gass, a spokesperson for Toronto Hydro. “The rationale for making this change is cost responsibility: the customer who requests and benefits from this service should be responsible for paying the costs.”

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But Burton says customers are already paying for this service through their OEB-approved electricity rate.

“It wasn’t really ‘free of charge,'” Burton said. “It was embedded in Toronto Hydro’s Conditions of Service. When they go to the OEB, the OEB says, ‘What do you do for this money?'”

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Toronto Hydro says they have a right to change their Conditions of Service without OEB approval – a fact the OEB has confirmed. But the company also acknowledges its 2015 rate application – which was approved by the OEB – contains explicit reference to customer isolation.  

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“The 2015 rate application outlined both specific words and forecasted costs relating to one free isolation,” Gass said. “However, in approving that application, the OEB did not approve – or deny – costs relating to specific activities/services such as performing a free isolation.”

The costs incurred for providing this “complementary” service were roughly $2.2 million a year between 2011 and 2015. According to Toronto Hydro’s own rate application, the reason for offering this service for free was to allow customers to perform required repairs and upgrades safely.

“Toronto Hydro provides eligible customers with a single isolation per year free of charge in order to encourage the maintenance of equipment,” says the document. “In addition to facilitating maintenance work, customer isolations ensure the safety of customers, as work in the vicinity of energized assets puts them at potential risk of contact with energized equipment.”

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Burton, who acknowledges his business relies on this type of work, worries some customers will either forgo important repairs or resort to using dangerous and unsafe practices when working with electricity. He says Toronto Hydro’s change in policy is irresponsible.

“Its putting their customers at risk. It’s putting electricians at risk,” Burton said. “A lot of these townhouses are joined with common walls. If you start a fire in your house, there’s a very good chance you’re going to burn out your neighbours as well.”

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Gass, however, says Burton’s assertions are “entirely speculative,” and that anyone thinking of performing repairs should hire a licensed electrician and follow all safety requirements.

“That’s entirely speculative and there’s no reason for us to comment on something like that,” Gass said, referring to Burton’s comments.

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“It really doesn’t apply in this case. You need to have a Toronto Hydro crew or a Toronto Hydro contractor working on our equipment.”

The OEB, meanwhile, says utility companies have a right to make changes to this type of service.

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“Local distribution companies are within their rights to revise their Conditions of Service,” said Lars Hansen, a spokesperson for the OEB, adding that companies must follow approved guidelines when notifying customers of such changes – something Toronto Hydro did by including brochures mentioning the change in its January and February bills.

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But the OEB hasn’t given Toronto Hydro a complete pass on the issue. Hansen says the regulator will be looking into the practice.

“We are reviewing this matter to determine whether any further action is required on OEB’s part,” said Hansen.

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Customer rethinks electrical upgrade

Ron Taylor, 70, who spent much of his life working at The Salvation Army, says he’s reconsidering an important upgrade to his home’s electrical panel after learning he’d have to pay upwards of $2,200 in additional costs for Toronto Hydro’s customer isolation. He says that while the work is important and necessary, given the age of his building, he’s not sure he can afford the additional costs.

“I was always thinking we were entitled to one free disconnect and reconnect in the year,” said Taylor. “With the price the inspector said about shutting off the hydro, no, I’m not going to get it done because that adds a couple of thousand to the quote I was originally given.”

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Taylor lives in a townhouse and is surrounded by neighbours. He and fellow condo owners received a letter earlier this year stating their insurance rate had increased because of the old electrical panel in his home. He says if he can’t afford to pay the additional isolation fee, he’ll just resort to a cheaper alternative – like installing fuses that flick on and off.

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“I just wanted to get this work done because this townhouse has been here for 45 years and things have a tendency of breaking down,” Taylor said. “I just want to be safe not sorry.”

Tim Birnie, electrician and owner of Birnie Electric, says the change in policy is unfair. He wishes Toronto Hydro would have given customers more time to respond and perhaps given a longer grace period before the charge was implemented.

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“It’s always been a free service they’ve offered, and this sort of just came out of nowhere,” said Birnie. “At least give people some kind of warning. Say ‘September 1, 2017 we’re doing this,‘ so people who are thinking about doing the work can have a chance.”

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Birnie also thinks the new charge will discourage customers from completing necessary repairs, and worries that customers might choose instead to work with live electricity.

“It’s already a couple of thousand dollars and if you add that on top of it, that’s another chunk, like 30 or 40 per cent, so it’s significant,” Birnie said. “They do charge in commercial if you have more than one of these per year – I get that. But at least once per year or even every two or three years. My god, I mean, some homes it’s been 80 years and they haven’t had one.”

Hydro One – Ontario’s largest electricity distributor – offers its customers one free isolation per year so long as they provide 10 days notice. Alectra Utilities, including PowerStream which services the GTA, also provides one free disconnection and reconnection per year.