On July 7, 2016, the Ontario Energy Board staff (OEB staff)
issued a Staff Bulletin indicating that electric
vehicle (EV) charging services are not subject to OEB regulation.
According to OEB staff, EV charging services (including charging
stations) should be treated as competitive products and services
for which no OEB licence is required. OEB staff also note that
electricity distributors may be permitted to own and operate EV
charging stations, because these are services to assist the
Government in achieving its electricity conservation goals.
The Staff Bulletin was issued in response to a
number of inquiries. As noted by OEB staff, the interest in EV
charging services is increasing in response to the parts of
Ontario's Climate Change Action Plan that target
significant increases in electric vehicles in the coming years. The
Action Plan promotes a shift to electric and hydrogen vehicles and
establishes a province-wide target of electric and hydrogen
passenger vehicle sales of 5% in 2020 (see here for our earlier
post on this topic).
In coming to the conclusion that EV charging services are not
subject to OEB regulation, OEB staff concluded that such services
do not constitute either "distribution" or
"retailing" of electricity.
The second of these conclusions is interesting. According to
section 56 of the Ontario Energy Board Act, 1998 (the OEB Act), retailing electricity is when a party
sells or offers to sell electricity to a consumer. Thus, on its
face, the sale of electricity to an EV owner from an EV charging
station would appear to be included in the definition of retailing.
OEB staff takes a different view, though, stating that "the
act of selling or offering to sell EV charging services is
distinguishable from the act of electricity retailing" because
"the service procured from an EV charging station can only be
used to refuel an EV." OEB staff reasons that an equivalent
service to EV charging could be provided by simply replacing a
spent battery with a full battery (and that would not be considered
to be electricity retailing). Therefore, OEB staff concludes that
"the sale of an EV charging service appropriately falls into
the category of other non-regulated, competitive products and
services identified on the OEB's website, for which the owner
or operator does not require an OEB retailer licence." At the
end of the Staff Bulletin, it is noted that there should
be no consumer protection issues with treating EV services as being
unregulated because owning and operating EV charging stations is an
inherently competitive activity and there will be a wide range of
While it is certainly clear from a policy perspective why the
OEB would not want to regulate EV charging services, it is less
clear from a statutory interpretation perspective that this is
outside of the definition of electricity retailing. It will be
interesting to see whether the Government decides in the future to
add a specific exemption for EV charging services from the
application of the electricity retailing rules (the current
exemptions from distribution and retailing rules are set out in Ontario Regulation 161/99).
At the end of the Staff Bulletin, OEB staff notes that
electricity distributors may wish to offer EV charging services.
Section 71(2) of the OEB Act allows a distributor to provide
services other than electricity distribution that would assist the
Government of Ontario in achieving its goals in electricity
conservation including, among others, services related to "the
promotion of electricity conservation and the efficient use of
electricity" and "electricity load management." In
OEB staff's view, the provision of EV charging services could
fit within this exemption and EV charging services could be
included with distribution utility activities. What is not
discussed, though, is how costs would be calculated and allocated
for such services to address the concerns that might be raised by
competitive service providers.
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