OEB Issues Decision Regarding Real Estate Transactions By Electricity Distributor

A recent decision of the Ontario Energy Board addressed a series of issues arising from the acquisition and renovation of a building for office and storage purposes by Milton Hydro Distribution Inc. In its consideration of the regulatory treatment of the issues arising from Milton Hydro's real estate transactions, the Board said that the over-arching principle embedded in its performance-based outcomes approach is whether a utility is asking the Board to approve outcomes that customers value.

Using the performance-based outcomes approach to assess the implications of the acquisition and renovation of building space by Milton Hydro led the Board to conclude that two outcomes had no value to customers. First, the Board found that office space was created that exceeds Milton Hydro's reasonable requirements over the planning horizon. Second, the Board found that incremental "premium" costs incurred by Milton Hydro for indoor storage space as a substitute for outdoor