Questions?

What I’d say to the member opposite is the main reason he can cite that first figure is because Ontario as a province decided to phase out coal in our electrical system. It had absolutely nothing to do with the actions of this particular government—absolutely nothing.

Now, the innovations in the private sector he talks about in steel, those are real as well. But again, that has nothing to do with these guys. These guys have a job; their job is to set targets and to encourage us to assemble the facts to get there. They can’t just wait and wait for the market to solve problems. They can’t just hope that previous decisions will make their current numbers look good. They need to stand with the policy and the resources that we have in the province of Ontario and give people a way to make their homes cleaner, their cars cleaner and their businesses cleaner; and they’re failing.

I appreciate the member’s comments about following facts and evidence, so I’d like to introduce some evidence that was submitted by our Auditor General in May of last year. We’ve reduced our greenhouse gas emissions from 2005 by 27%. We’re 90% to our target. We’re leading the country. When we green our steel production and we get our small modular nuclear reactors online, we’ll be at about 35%. That’s a fact.

I’m impressed that you read the decision, but I’m wondering if you read E.B.O. 188, which is the policy which dictates how the regulator is to decide rate changes. And 2.2 says, “Specific parameters of the common elements include the following:

“(a) a 10-year customer attachment horizon;

“(b) a customer revenue horizon of 40 years from the in-service date of the initial mains.”

Will you admit that this is a departure from the status quo, that our gas bills today incorporate a 40-year window, and that the regulator has departed from that practice, contrary—

Next question?

Keeping Energy Costs Down Act.

I would be interested on hearing the member’s take on why he believes the government is so forceful on this when they blame the Liberals for doing the exact same thing.

I think the only way I can answer my friend from Hamilton is to say that this is a case of regulatory capture. I mean, it’s not only here in the province of Ontario. This Greener Homes Grant I was talking about before: The federal government embarked upon this piddling $2.6-million experiment. Guess who was the co-sponsor of this initiative, who you have to work with to get that into your home? Enbridge. Enbridge helps vet the applications for the Greener Homes Grant. What sense does that make?

Yes, we have to work with Enbridge, because they are the agents for those ratepayers, but there has to be a regulator. It’s a private company. It has a private interest. Some 90% of the situations in our city where people replace their home heating and cooling situation are when they break down in the wintertime. What do we think the rep says at the door? “Welcome to your new gas heat pump.” We need something that’s independent, that gives people good choices that are affordable; and this government is not doing that.

The fact of the matter is that the profitable places for Enbridge to expand to are the ones near major urban centres: the plans they have for Windsor; the plans, I’m sure, they have for suburbs around Toronto and Ottawa. That’s who they care about. We’re not surprised by the fact that Enbridge’s priorities line up for their bottom line.

Where we do get surprised and a little uppity is when we start making decisions in this House for a company that made $46 billion last year, whose CEO makes $19 million a year, while people are starving and having a hard time feeding their kids. We should be standing up for them, not for Enbridge. This bill is a disgrace for the province of Ontario.

The good news is that it’s not too late for us to chart a different course. We could actually promote some of the programs we already have, which I talked about. We could tell Enbridge, “No, you’re not going to get your handout. We’re not going to sign up on your corporate welfare. We’re actually going to make sure that when we give assistance, it is to the hard-working people of Ontario who make this province the great place that it is.” That isn’t Enbridge. Enbridge has a contract with the province of Ontario that they’re required to fulfill. It’s not even clear to me that they are fulfilling it, when I hear about issues of compromises in the pipeline, people getting sick in communities around pipelines where there are leaks. The fact that I haven’t heard anything from this government about those health and safety concerns bothers me.

We are going to pass this specific bill to make Enbridge richer. I think it’s wrong.

We don’t require Enbridge to tell us if there are any problems in the pipelines. And by doing that, we’re not protecting the workers responsible for maintaining those pipelines; we’re not protecting the community around the pipelines. Those pipelines aren’t going to go anywhere. We need them to be safe.

I’ll end on a positive note. The people of Ontario, who work hard, deserve nice things. They deserve a heat pump in their building and home. They deserve access to good public transit. They deserve the opportunity to have clean air, clean water and healthy communities. But this bill does a favour for Enbridge, and it doesn’t do a favour for them.

We should rewrite the bill. We should make sure Enbridge pays for its mistakes. End of story.

Thank you to the member from Ottawa Centre for his remarks this afternoon. He mentioned, who do we work for? Speaker, in this place, we’re members—the member opposite believes that we’re legislators, which we are. It’s a legislative assembly. They’re harping on the fact that, as a Legislature, we’re taking a policy decision to correct a mistake—very weird line of thought. But we’re legislators, everyone. So we can legislate, great, wow—so ironic.

But my question—he’s referring to the report. I appreciate he read the report. My question is—and I’m going to quote—do you support this finding? “I do not support a zero-year revenue horizon for assessing the economics of small volume gas expansion customers. I do not find the evidentiary record supports this conclusion.” This is from Commissioner Duff, in the report you’re quoting.

When will you allow natural gas expansion to places that don’t have it, to get it?

I’d like to start by echoing the energy minister, who paid homage and thanked the late Richard Dicerni, the past chair of the Ontario Energy Board, whom I first encountered as a federal deputy minister for industry.

Mr. Dicerni worked under Premiers Bob Rae, Mike Harris, Dalton McGuinty, and then he got recruited by Alberta Premier Jim Prentice and was asked to stay on by Alberta Premier Rachel Notley to serve as the head of the Alberta public service.

Former Premier Rae remembered him as someone who “served all parties with equal integrity and thoughtfulness, and believed strongly in the need for a strong, non-partisan public service.” I want to emphasize this because the OEB’s mandate includes protecting consumers and making decisions independently of the government of the day.

From the OEB website: “The chair of the board of directors is accountable ... for ensuring the independence of decision-making by commissioners and others that carry out the OEB’s adjudication work.”

The energy minister has promised to appoint a replacement for Mr. Dicerni this spring—someone who he says will implement the changes in Bill 165 and who will make sure that the OEB will “reinforce the government’s priority,” which the government will outline in a new natural gas policy statement. I trust that the honourable energy minister will choose an independent OEB chair, differently from some of the things that we’ve heard the Attorney General and the Premier say about how they want to appoint Conservative-friendly judges.

That gets to my first concern about this bill, Madam Speaker: Regulating our energy system and deciding what eventually gets charged to consumers can get pretty technical. The OEB decision and order on December 21 which triggered Bill 165 was 147 pages long. That’s a really good reason for separating all of this from politics. In politics, partisan decisions get made based on whatever the average voter has time to listen to, and if the devil is in the details, partisan politics isn’t the best tool for sorting it all out.

Now, an important part of the mandate of the OEB is to protect consumers and do it through independent adjudication. With this bill, the government of the day can intervene; the bill creates another path, a political path, to try to get decisions to go your way. Donations and access to ministers will now matter. And we all know that when things get out of control—our honourable colleagues from the government side know well that when things get out of control, you end up with things like the RCMP criminal investigation, like this government is dealing with now.

I want to talk now about regulated utilities. Just by way of introduction, a regulated utility is allowed to make a fair return on their investments, and they can do it off of what they charge their customers for gas. Because they can do that, we have to protect consumers not only from unfair gas charges, but from unnecessary investments, which they will have to pay for because the utility gets to make a return on it. Making thoughtful judgments about things like what a utility is allowed to spend money on and recover the cost from consumers, and what’s a fair profit, are why the OEB was created in the first place.

As I said earlier, this bill allows the government of the day to intervene, to call new hearings on any matter and to specify through regulation which persons of interest may provide submissions to such hearings. This is how the minister is going to be able to influence individual decisions of the OEB, and lobbying the minister will now become part of the process of deciding what we do or don’t do to protect consumers.

The government of the day is also going to be deciding, according to this bill and the regulations, what’s called the revenue horizon. So if some developer wants to put in a new subdivision and maybe wants to put in gas, the utility—whether it’s my own Utilities Kingston or Enbridge—has to calculate what it’s all going to cost and what the number of years of revenue is going to be, to be able to cover that cost. The developer is going to promise a certain number of natural gas customers, and if that calculation is all going to work out, we have to make sure that the new consumers are going to actually stay with natural gas.

We know that that is not going to be the case. The OEB is saying we should be expecting that people over the next 10, 20 or 30 years—potentially very quickly—are going to get off natural gas, because technology is constantly improving, because there’s climate change pushing us to try to do something to help our kids and grandkids, whom we love dearly.

The problem that the OEB is anticipating—they’re trying to protect consumers, because if infrastructure is not being paid for, doesn’t get paid for by gas consumers because there are less and less of them, the costs go to all the other existing customers; all the other households have to pay more. Currently, what happens is the cost of the new gas connection is spread out over 40 years of gas bills of existing customers. Probably most people in this chamber right now will pay for new gas infrastructure, and because we’re expected to pay for it over 40 years, it turns out that there’s no need for an upfront payment to make up the difference between what gas customers will pay for and what it actually costs. And remember, it’s Enbridge, or the utility, who will always have the right to recover the cost of natural gas infrastructure, plus interest and plus a fair profit.

What this government is risking by overturning the OEB decision is not protecting homeowners, because all of us have to pay if there’s infrastructure left over that’s not being used. This is why it’s not just a pay-it-forward system. That’s why something different is happening here. Because our economy has to switch from using fossil fuels to using electricity over the coming decades, we’re going to have to do that, and that’s what’s different about now.

The whole trigger of Bill 165 was a decision of the OEB to say that because more and more people are going to switch to heat pumps, and I’m really happy to know—if somebody is worried about whether heat pumps work, just ask the energy minister himself, who told us today that he has got a great heat pump system with an electric backup. He has no natural gas connection, and he’s fine, so he’s a great poster boy for heat pumps. That is why I think the OEB is justified in thinking that the transition could happen very fast to heat pumps.

The OEB also said there’s what they call a split incentive program, so if the developer doesn’t have to pay any money up front for a natural gas connection, which is what’s happening right now, they end up installing natural gas every time. What that means is that one technology for energy is favoured over all others. One technology is getting a subsidy, a subsidy which all of us pay for—except for the Minister of Energy, who doesn’t have to pay for that subsidy, because he’s not on natural gas. So the Ontario Energy Board is trying to protect consumers.

Now, the government has said—when the OEB thought about this for about a year, they had thousands of pages of testimony. They thought about it for a year. They had a lot of people providing input. They argued over should this, what they call, revenue horizon, the time over which we spread out the cost of new natural gas infrastructure on our gas bills—there was a discussion over whether it should be something shorter than 40 years. But the government, if you go look at the Environmental Registry of Ontario, has said that it wants to “initially restore the revenue horizon at 40 years,” which only makes sense if you think that in 30 or 40 years—let’s see, that’s 2055 or 2060—everybody is still going to be on natural gas. That just doesn’t make sense.

There were some discussions that maybe the time horizon should be shorter. Maybe it should be 20 years or 15 years, in which case one third or one half of the cost of a new natural gas installation would have to be paid up front. These are all different compromises that the OEB was looking at, but the government doesn’t seem to be interested. It wants to put the revenue horizon right back at 40 years.

Now, to be fair, the government does admit that the OEB in the future may change this time horizon when the government lets it. So what happens if the OEB changes that time horizon from 40 years down to something more reasonable like 20 or 15, assuming Bill 165 goes through? Well, then everybody will have to pay back the costs of gas infrastructure faster, and all the household monthly bills are going to go up. And so, what the OEB is saying is that we’d better give the option to pay up front so that the burden of paying for this infrastructure doesn’t go on all the other ratepayers.

Let me end by saying that there are things that the government could do to avoid subverting the independence of the OEB and to do something positive, rather than just kind of going backwards, driving backwards, as we often see them do.

Did the government look at supporting what they call a negative rate rider? That’s where, if somebody pays for their natural gas connection up front, they get a discount on their gas bill, because they already paid for the connection infrastructure and they shouldn’t have to pay for other people’s connections.

Did the government look at allowing the cost of cold-weather heat pumps or a borehole for ground-source heat pumps, something which is inexpensive when you’re building new? Did they look at putting that cost spread over many decades on a property tax bill or an electricity bill? Did they look at ensuring that consumers don’t have to pay an exit fee if they decide to stop using natural gas? These are all alternatives that this government could have been considering instead of just going backwards to what we had before, because backwards is not working.

Here’s my final point. It’s a bit of advice for this government. The last time the government of Ontario had a long-term energy plan was in 2017, the previous Liberal government. Now, the government has siloed initiatives going this way on electricity, that way on natural gas, another way on housing and environmental policy, and nowhere on climate change. Through Bill 165, the government wants to be able to give directives to the OEB to hold what are called generic hearings and to bring in all sorts of stakeholders, really different stakeholders that the government wants to bring in.

Why is the government backed into this corner? It’s because the Conservatives ditched the idea of a whole-of-government long-term energy plan where housing policy and industrial policy and transportation policy and electricity policy and climate change policy are all considered together and planned together. The government has not updated the long-term energy plan that our province had in 2017. It has not had a whole-of-government energy plan. It hasn’t done the hard work of putting the pieces of the puzzle together and planning for the future. Madam Speaker, this is at the core of why this government will fail the kids and grandkids we love.

Questions?

Thank you very much to the member of the opposition who talked to many aspects of saving money for the end users and how the changes—and I don’t know. He said that the bill is trying to revert or restore the exact situation which was before the decision of OEB, so it’s not like introducing something new. It’s exactly trying to keep things as they were. If they want to put infrastructure, we have to put the investment and a return will be in 40 years.

Talking about savings—we can talk about savings. We can talk about scrapping the cap-and-trade carbon. We can speak about introducing the one-bill Ontario Electricity Rebate. So there are savings that we have been trying to do in energy, but this is about the infrastructure and the 40 years instead having to pay.

Last election, I recall the Ontario Federation of Agriculture laid out their priorities for farmers in the province of Ontario. One of the priorities that I’ve heard about from members of the agricultural community and farmers in Niagara West had been the expansion of access to natural gas infrastructure.

This afternoon, it has seemed as though there’s a real antagonism from the opposition benches towards natural gas. I had thought there was a bit of a consensus around the support for the agricultural community’s request in that regard, but now I’m not so sure. I’m wondering if the member opposite can clarify: Is the Liberal Party of Ontario opposed to investing in the expansion of our natural gas network in Ontario?

Thank you for the question. I was wondering also what the government really wanted to do, and the answer is in the Environmental Registry of Ontario notes. It says there that the government wants to first go right back to the 40-year revenue horizon, which means that natural gas infrastructure is completely free to the developer but is paid for by us, the ratepayers, the homeowners. They’re going back. Now, they’ve added a whole bunch of things so that they can interfere with how the OEB operates, make it redo hearings, make it hold extra, what they call, generic hearings.

But in the Environmental Registry, it says, “We first want to go back to that 40 years.” In fact, every one of the people, including Enbridge, wanted to shorten that 40 years to a shorter time.

So what we’re saying is, let’s give developers a rational economic choice. They have to feel a little bit that there is a cost that has to be recovered. So that’s why we should be protecting, we should be allowing the Ontario Energy Board to be an independent adjudicator to protect consumers.

We also need natural gas for the next few years at peak times to make sure that the electricity is reliable when supply and demand fluctuate. It’s not like we’re getting rid of natural gas tomorrow. I think if the member is suggesting that, he is wrong. There is a place.

When a developer builds a new subdivision and decides whether to put natural gas in, we want it to be a rational decision, where the cost is—

For me, what’s important is that the OEB is trying to protect consumers. This principle should apply not just to Enbridge but to all other natural gas distributors as well. So for me, what’s important is the principle. I’m not out to get anybody. What I want is this principle that if you decide to build natural gas infrastructure, you should make a rational decision based on how long it’s expected to be used. And if you’re not going to recover the cost of that natural gas infrastructure from the gas bills paid by the customers, then you need to have some fraction of that cost paid up front. That has to be a clear payment so that a rational economic decision is made.

What we see with this government is unprecedented political interference. We see a government that’s run by insiders and lobbyists. We see a government that’s working on the side of huge corporations like Staples, like Walmart, and now Enbridge.

Can you speak to the fact that this government overwrote their own regulatory body, despite overwhelming evidence in favour of Enbridge, which will now be able to pass on these subsidies to individual Ontarians? How is this government interfering in all of these jurisdictions and claiming that they’re for the people when who they’re really for are large corporations and big, big monopolies like Enbridge?

It’s always a pleasure to rise. We heard today from my colleagues that spoke about Enbridge and the fact that they make billions and billions of dollars in profit. We heard that their CEO is making millions and millions of dollars in compensation. I listen to my colleagues on that side of the House talk about affordability. We know that living in this province, whether it’s rents, groceries, gas prices, food banks—I did a member’s statement this morning on food banks. It’s the highest level ever. There are encampments, even in Niagara, which my colleague across the road knows.

But the one thing that’s interesting here, when I listen to my Liberal friend, is they talk about affordability. So I’m going to ask you a question. On Bill 165, I think we’ve pretty well got our positions straight. So my question to the Liberals: Bill 165 I think is a mistake for the reasons I just said, but what about your party when you decided to privatize Hydro One at the expense of affordability in the province of Ontario?

I just want to focus on the fact that what we are focusing on and what the government seems to be ignoring is that we know, and the people of Ontario will soon know, that this is a bill that will keep Enbridge happy. This is a bill that will make customers pay and will make Enbridge continue to operate in the way that they have that is actually costing people money in a time when we have a substantial affordability crisis. So why would this government put forward a bill that is going to cost people and going to benefit Enbridge, particularly in the midst of an affordability crisis?

I’m speaking today on the second reading of Bill 165, the Keeping Energy Costs Down Act, 2024. I believe the changes proposed by this act will aid in both protecting the interests of Ontario energy consumers and getting housing and energy infrastructure built faster. It will also play a role in ensuring that Ontarians and Ontario businesses will be able to access reliable and affordable energy now and into the future.

I am one of the two parliamentary assistants to the Minister of Energy. Over the past year and a half, I’ve been quite proud of what I consider our pragmatic and particularly technology-agnostic approach to energy policy. This government has built an electricity system in Ontario that I think gives customers choice and the opportunity to manage their energy use. We also, as has been stated multiple times, have one of the cleanest grids in the world.

We’ve shown our commitment to growing our clean energy advantage through early planning measures like requesting a Pathways to Decarbonization report from Ontario’s Independent Electricity System Operator. This report resulted in the government’s Powering Ontario’s Growth plan, which was released in July 2022. We also created the Electrification and Energy Transition Panel in 2021, which has provided critical recommendations to support the province’s first integrated energy plan.

Ultimately, our clean grid has become a clear competitive advantage in world markets. Countries and industries around the world are seeing the need to reduce emissions. Many consumers appreciate seeing a focus on clean energy. As Minister Smith described, Ontario is quickly becoming a leader in electric vehicle and battery manufacturing as well as green steelmaking, as demonstrated by the major investments made in our province by companies like Stellantis and Volkswagen.

I remember being particularly struck by an anecdote that I think Minister Fedeli gave us about the Volkswagen decision to relocate to St. Thomas. At the time, they had been looking at several other American jurisdictions which, from a price perspective, may have made more sense than St. Thomas. However, those jurisdictions were operating on coal, and Volkswagen felt that it would be somewhat hypocritical to produce electric vehicle batteries on a coal-based system, which ultimately led to St. Thomas in Ontario being chosen.

In Ontario, we’re doing what we can to support electrification through the province. To go briefly into an anecdote before I get into it more, lowering emissions is very important to many people in Waterloo region. Just last month, I was at an announcement regarding a sort of tripartite, federal-provincial-municipal funding grant to Grand River Transit. Thanks in part to that funding, about $5 million of which came from the province, Grand River Transit is getting 11 fully electric 40-foot buses and new charging units.

I was there for the unveiling of the first new hybrid bus in its new vinyl wrap design, which introduced me to several amateur transit enthusiasts, which I had heard rumour of, but I’d never had the pleasure of meeting any in person. I ended up sitting next to a young man who I believe was named Gordon, who regaled me for a solid 10 minutes with stats about the efficiency and benefits of the new electric buses, which I was very grateful for because, as is usual—with the exception, frankly, of this—I hadn’t actually prepared any notes on what I was going to say at this announcement. I more or less got up and just parroted what Gordon had told me, which worked out wonderfully. So there is no doubt that there are a lot of people who are excited by these new electrified transit options, and that Grand River announcement was a great example of three levels of government coming together in support of something.

Ontario’s population is, as we have commented on regularly, growing at an incredible rate, with us expecting to see millions more people just by the end of this decade. With growth comes demand. Now, for the first time since 2005, Ontario’s electricity demand is rising. The IESO’s most recent analysis indicates that electricity demand in the province could more than double by 2050. If demand doubles, as we expect it to, then of course, so must supply.

It’s absolutely imperative that we start now if we’re going to build the homes and the infrastructure to support the Ontario of the near future and provide the power that we’ll need to thrive. That said, Speaker, this rapidly expanding growth and associated calls on energy bring forth many thoughts and opinions from Ontarians. We need to make sure that all voices are heard, which brings me to my main point.

Last December, the Ontario Energy Board made a decision to bring the 40-year revenue horizon, which had been set back in 1998, down to a zero-revenue horizon, to take effect, by this point, in less than a year. This is a decision that, regardless of what one feels about it, will have a huge impact on families and businesses.

It appears that the OEB made the decision in the absence of some vital evidence from a number of major players and stakeholders that have a significant and important understanding of this sector. The decision was also made without consulting with IESO about a significant point, which is the impact that this decision would have on the province’s electricity grid, particularly the impact it would have given that this decision would essentially require a massive and sudden increase in electrification demands, which would have a huge impact on the province’s grid. That was not covered.

Herein lies the central purpose of the Keeping Energy Costs Down Act. It’s making some changes to the Ontario Energy Board’s regulatory processes to make sure that this kind of oversight doesn’t happen again.

I am a lawyer, but I was a criminal prosecutor and therefore I have, at best, only a nodding acquaintance with the complex law surrounding regulatory bodies such as the OEB. Although, that said, having sat here this afternoon, I was initially feeling somewhat hesitant about getting up and speaking on something that I have so little authority on, but I now feel completely comfortable, after having listened to several of the past speakers, to speak loudly and proudly about something that I don’t necessarily have any specific expertise on, because it appears to not be a prerequisite. Essentially, I don’t require any special knowledge to look at this decision and see what I would call a very concerning dissenting opinion.

So, Speaker, please bear with me as I, again, read out this quote from the dissent—it’s authored by Commissioner Allison Duff—as it’s lengthy but relevant. Commissioner Duff wrote, “I do not support a zero-year revenue horizon for assessing the economics of small volume gas expansion customers. I do not find the evidentiary record supports this conclusion. The CIAC comparison table filed by Enbridge Gas did not even consider zero within the range of revenue horizon options. Zero is not a horizon. It is fundamentally inconsistent with the intent of E.B.O. 188 by requiring 100% of connection costs upfront as a payment, rather than a contribution in aid of construction. There was no mention of zero in E.B.O. 188—yet a 20 to 30 year revenue horizon was considered. To me, the risk of unintended consequences to Enbridge Gas, its customers and other stakeholders increases given the magnitude of this ... change.”

Commissioner Duff continues: “The rationale provided in the majority decision to support zero is predicated on understanding the considerations and circumstances facing developers.” However, “this rationale is conjecture as no developers intervened or filed evidence in this proceeding. In contrast, a recent OEB proceeding regarding a proposed housing development in Whitby included intervenor evidence, oral testimony and submission by the affected developer group, enabling the OEB to render a decision based on the evidence.

“A zero-year revenue horizon implies an indifference as to whether these developers decide to connect, or not connect, any gas expansion customers. Is the scenario of no-new-gas-connections, replaced by construction of all-electric developments, feasible? For example, would electricity generators, transmitters, distributors and the IESO be able to meet Ontario’s energy demands in 2025?” She concludes that by writing, “I don’t know.”

Speaker, regardless of where one stands in the discussion around energy, every person in this chamber should be worried when one of the three presiding commissioners says that she was not presented with the necessary evidence to reach any decision, let alone such a drastic change as this, going from a 40-year revenue horizon down to a zero-year revenue horizon in less than a year.

Frankly, it’s not just me reading a dissenting decision and commenting as an armchair expert. Other experts themselves are concerned. I’ll point here to a column written by Aleck Dadson, the former chief operating officer of OEB, and Ed Waitzer, the former chair of the Ontario Securities Commission, who described their frustration with the Ontario Energy Board’s decision.

Mr. Dadson and Mr. Waitzer stated as follows: “In our view, adjudicators should focus on deciding specific matters in a transparent, fair and non-partisan manner. They should do so by applying a legal and regulatory framework to findings based on evidence and arguments presented in an adversarial process. And they should avoid trying to resolve complex policy issues, in which any decision will affect unrepresented stakeholders and other areas of concern. In short, adjudicative panels shouldn’t stray.”

The Keeping Energy Costs Down Act is proposing legislative changes that will ensure major OEB decisions with far-reaching applications, like this one, don’t happen again without adequate stakeholder consultation.

I’m going to change course for a minute here to talk briefly about regulatory agencies such as the OEB and to have a bit of background. Again, I go back to my feeling of inferiority about speaking about this, because it’s not my area of competence. However, what I have heard this afternoon has indicated that there’s a terrifying dearth of understanding about what regulatory agencies actually are present in this House.

Regulatory agencies are critical to the operation of modern society. Because of their importance, it’s essential that they be subject to effective governance. Essentially, regulatory agencies take very, very specific areas of practice that the courts, the government, the Legislature don’t have the time or expertise to delve into in order to establish their individual application in individual cases. So it becomes delegated. Essentially, every regulatory agency is exercising powers that were delegated to them by Legislatures, which is necessary in the complex specialized economy that we operate on. Ultimately, when you are delegating power from a Legislature to a regulatory body, the delegation entails carrying out the objectives of the legislation that was enacted, but frankly that also entails carrying out the government policies that inform the legislation. That’s what makes a regulatory body, particularly a government regulatory body, significantly different than, say, a court. A court is a judicial decision-maker, whereas a regulatory agency is a quasi-judicial decision-maker, but only in limited circumstances.

So given that regulatory agencies are tasked to some extent with carrying out government policies informing their enacting legislation, they’re not independent of the government, and they never will be. At the same time, however, I will say that being able to properly exercise that type of delegated authority does require a certain amount of independence, because you need to have that in order to operate as a quasi-judicial decision-maker, which requires them to have, as I said, that measure of independence. However, the truth is regulatory agencies are not courts. They are subject to oversight to varying degrees and in different ways, by the Legislature, by the government and by the courts. In other words, they’re subject to three sources of external governance already.

The OEB itself, specifically, was created by a statute, the Ontario Energy Board Act, 1998. It’s an independent regulator. If you go into the act, you will see that the stated purpose of the OEB is to serve the public interest. What’s interesting is we don’t have a very clear definition of the public interest, but frankly, that’s not uncommon in this type of legislation. At the same time, however, the OEB is required both in its governing legislation and also by the accepted practices of governance to be responsive to provincial government policy. That’s not an oversight or a problem; that’s literally how it was created and how it functions.

In doing what its primary purpose is, which—let’s be clear: The objective of the OEB is predominantly related to determining the prices to be paid for the transmission and distribution of gas and electricity in the public interest. So when the OEB is exercising this primary goal, which is approving these rates, it’s ultimately required to balance competing interests: residential consumers, large and small business, the government and utility shareholders. The key here that, again, this discussion so far has missed is that the OEB does not serve the interests of just one group, and to understand the OEB as some sort of consumer protection agency is a completely incorrect understanding of how it functions as a regulatory agency.

The OEB’s role and their purpose, as I said, is to balance interests, and those interests often compete, which is how we end up in the public interest, which is a grand final assessment of what is best for the general public, understanding that the general public, once you divide it, in itself has a number of competing interests. The thing is there’s no way that the OEB can appropriately balance competing interests in a situation such as the one we heard, where a decision was made without appropriate input or information from a number of industry experts and stakeholders in this area. So it was this nature of the decision, which, frankly—what it shows is not necessarily some sort of over-dominance on one position by the OEB but perhaps a failure of policy to make it clearer that the OEB as an institution needs to focus more on that type of public consultation and stakeholder recipient opinions than it currently does.

What we are proposing is that the OEB would have to conduct more public engagement to ensure that any impacted individuals and organizations have the opportunity to participate, because, as happened here, it’s clear that OEB hearings, while discrete events apply to individual cases, have the potential to tread into matters that have a significant public interest for a number of people. But the thing here as well is that you have to understand what is happening with this decision. When you’re looking at judicial review of a regulatory agency, what happens is that a court would take issue with how it essentially exercised its power, as versus the nature of the decision, which is why it requires government involvement in this case. So what the government is doing is not inserting its own decision in place of the OEB’s decision but remitting the decision that the OEB made back to the OEB with additional policy considerations that the government wishes the OEB to consider, which is entirely within the rights and power of the government—any government, regardless of political stripe—based on how the OEB functions, how any regulatory agency functions. So this is a completely appropriate way of doing it in order to hand that back.

But ultimately, we’ve talked about the OEB decision’s impact on a number of areas, and I think the one that I want to focus on more remains the housing, because the practical impact of this is to make the cost of gas connection something that has to be paid up front, as versus amortized over the current 40-year time period. So in the world of this decision, builders would be required to pay the entire cost at the time of the gas application and then bear that cost up until the point that the house sells, which substantially increases the total costs. We’re looking at between $4,500 to $6,000 per residential unit. So for a large subdivision, we’re driving that, theoretically, up into the millions. And that burden then transfers quickly to homebuyers as they pay up in the form of those higher prices for new houses.

What I have not heard here today is that home builders and residential construction professionals in Ontario have a long and, I would say, well-illustrated track record of supporting and incorporating climate change initiatives. Homes are ever more energy-efficient and the industry itself has followed and employed hybrid heating technologies. The key here, though, is this: Realistic timelines must be respected because we have seen what happens when ideology overrules reality. In fact, we’ve lived it. Ontario suffered under it. We won the 2018 election because of it, and we won’t be subjecting Ontarians to that again.

In the circumstances we face currently, which is an affordability crisis and a housing supply shortage, we simply must still support the pipeline infrastructure required to deliver low-carbon fuels such as natural gas, which is a readily available, reliable and competitively priced energy source. Doing so is absolutely crucial to maintaining affordability in the immediate and near future.

I also note there are a number of other spinoff issues that I haven’t heard mentioned. If we’re talking about natural gas hookups, we’re not just talking about heating, we’re talking about water heaters. We’re talking about gas dryers. Essentially, what the opposition would have us do—or, rather, have the OEB do—is immediately cut off the access to natural gas hookups. Because, yes, we can’t possibly put that type of financial burden on builders right now when we’re already struggling to make housing affordable.

You then also force your consumer into suddenly having to make a million different decisions about how they’re going to heat their home, how they’re going to heat their water, how they’re going to do their laundry—all, again, to support a purely ideological narrative.

Ultimately, I feel very strongly that this is the right course of action. It puts us in the realm of realism versus ideology, and I certainly will be voting in favour.

Thank you to my colleague across the way for his remarks. Building off of the member from Niagara West’s question, I know there is some confusion amongst the Liberal Party members, especially their leader, around answering tough questions. So yes or no to the member opposite: Do you support natural gas expansion in rural Ontario? Yes or no?

This bill doesn’t apply to the Natural Gas Expansion Program—so yeah.

Final question?