The OEB Releases Draft Corporate Governance Guidance For Regulated Utilities: From Prescriptive Regulation To Prescriptive Governance?

Introduction

On June 22, the Ontario Energy Board (the "OEB") released a preliminary draft report of its Corporate Governance for Regulated Natural Gas and Electricity Utilities (the "Draft Report"). The draft, prepared by the consulting firm Elenchus Research Associates Inc., is the latest step in the OEB's ongoing development of a guidance for corporate governance (the " Guidance"). According to the OEB, the Guidance is intended to help deliver outcomes that were established in the Renewed Regulatory Framework and to create a more consumer-centric regulatory framework by encouraging better planning and more efficient performance by utilities.

The Consultation Process

In 2014, the OEB commissioned KPMG to conduct cross-jurisdictional research into the corporate governance requirements of other energy regulators. KPMG also surveyed corporate governance practices already employed by certain electricity distributors in Ontario. In its Review of Corporate