1. October 8, 2003Ontario Energy Board1 Ontario Energy Board Update E.A. Mills Director – Regulatory Affairs Market Advisory Committee October 8, 2003

2. Ontario Energy Board2 Overview Who is the Ontario Energy Board Energy Conservation and Efficiency, including DSM/DR Alternative and Renewable Energy Sources Other OEB Activities

3. October 8, 2003Ontario Energy Board3 The Ontario Energy Board Who We Are –Regulatory agency of Ontario Government Non-share capital corporation Funded by the industry –Independent, quasi-judicial tribunal –Reports to legislature through Minister of Energy

4. October 8, 2003Ontario Energy Board4 OEB Responsibilities License all market participants in the electricity industry Issue codes and guidelines Approve monopoly rates Approve transmission facilities Approve mergers, acquisitions, amalgamations, divestitures Consumer protection and information Market surveillance/monitoring Licence compliance

5. October 8, 2003Ontario Energy Board5 Energy Conservation and Efficiency, including DSM/DR Promoting energy conservation and energy efficiency –reviewing codes, rules and licences –providing consumer education –Reply to Minister’s DSM/DR Directive

6. October 8, 2003Ontario Energy Board6 Energy Conservation and Efficiency, including DSM/DR Minister’s Directive for Electricity Sector –options for the delivery of DSM and DR activities –the role of electricity distributors in such activities –load aggregation in the IMO administered markets Application of policy framework in the gas sector Consulting with stakeholders in the fall of 2003

7. October 8, 2003Ontario Energy Board7 DSM/DR Consultation Stages of DSM/DR Implementation –Objectives & Opportunities –Design & Delivery –Monitoring & Evaluation –Funding Roles and Responsibilities Foundation Consultation Framework

8. October 8, 2003Ontario Energy Board8 DSM/DR Consultation Stages of Implementation –Objectives –Identifying opportunities –Measuring costs and benefits –DR in IMO market Roles and Responibilities –Primary & secondary in each stage Experience to date and need for incentives Foundational barriers to recommended roles and responsibilities –Identify –Action plans to overcome Issues to be Addressed

9. October 8, 2003Ontario Energy Board9 DSM/DR Consultation Phase I - Initiation –stakeholder interest Phase II – Development of Principles –staff discussion paper issued –advisory group –listed stakeholders can make written and/or oral representations Phase III – Draft Report of the Board –Board will releases draft recommendations for broad consultation before finalizing Three Phases for Work

10. October 8, 2003Ontario Energy Board10 Alternative Fuel/Energy Sources Promoting Alternative Fuel/Energy Sources –energy labelling Minister’s Directive for Electricity Sector –Review and enhance licence conditions to standardize, make consistent and clarify procedures for connecting new generation to distributors –Directive will be met through amendments to the Distribution System Code (DSC)

11. October 8, 2003Ontario Energy Board11 Connections Consultation Stakeholder consultation (Aug – Oct) Draft amendments to DSC will be subject to a formal notice and comment process (Oct – Nov) Distributor licence amendments (Nov 30) Work Plan

12. October 8, 2003Ontario Energy Board12 Connections Consultation Consultations are concluding Stakeholders have been organized into 4 working groups: –Process for connection –Technical requirements –Costs of connection –Applications and contracts Various working groups have met 4 – 6 times and provided substantive input to the Board Current Status

13. October 8, 2003Ontario Energy Board13 Other OEB Activities Distributor PBR plan review –Cost Allocation and Rate Design –Service Quality Regulation Distributor Retail Electricity Rate Setting –Transition Costs & Regulatory Asset s Monitoring

14. October 8, 2003Ontario Energy Board14 Other OEB Activities Processing final licenses Code amendments / developments –Gas Distribution Access Rule –Electricity Reporting and Record Keeping Requirements –Gas Marketer and Electricity Retailer Codes of Conduct –Electricity Transmission System Code –Retail Settlement Code

15. October 8, 2003Ontario Energy Board15 Other OEB Activities Distributor cash flow issues Transmission Planning for Economic Efficiency Post-Market Opening Activities