Regulator rejects Hydro Ottawa’s $6 a month increase in distribution rates

The Ontario Energy Board (OEB) has pulled the plug on Hydro Ottawa’s plan to increase hydro bills by as much as $6 a month, raising concerns about affordable electricity prices for its customers.

Hydro Ottawa submitted an application in May 2025 to increase distribution rates to fund upgrades to the aging infrastructure and improve “grid resilience.” The proposal would have seen distribution rates increase $6.08 a month in 2026, and then between $2.72 and $3.79 a month between 2027 and 2030.

In a decision released on Tuesday, the Ontario Energy Board rejected Hydro Ottawa’s proposed rated increase. The decision said the 16 per cent increase in distribution rates in 2026 “is significantly above inflation and would not result in a just and reasonable increase for customers.”

According to the OEB, the regulator determined:

• Hydro Ottawa’s proposed 2026 operating, maintenance and administration budget would be reduced by $11 million to $129 million, reflecting the OEB’s consideration of customer affordability in its decision-making and limiting pressure on customer bills. The Ontario Energy Board did approve an $8.4 million increase in Hydro Ottawa’s operating, administration and maintenance budget for this year.
• The proposed removal of the monthly net metering service charge was approved, as the incremental billing costs that justified the charge have largely been eliminated.
• The proposed shared saving mechanism incentive payments for a specific non-wires solution program was denied.

The Ontario Energy Board also ruled Hydro Ottawa’s plan to hire 81 new employees in 2026 “is not adequately supported by evidence.”

Hydro Ottawa has been directed to review the Ontario Energy Board’s decision and calculate the new distribution rates for the 2026-2030 period. A decision on the new rates is expected in June.

“The OEB’s decision reflects a careful, evidence‑based review of Hydro Ottawa’s application,” Carolyn Calwell, Chief Executive Officer of the Ontario Energy Board, said in a statement.

“By reducing costs where appropriate and approving changes that support reliability, the OEB has ensured that rates remain just and reasonable while maintaining the quality of service customers rely on. Our process is designed to balance the long-term needs of the energy system with the stability and regulatory certainty that support Ontario’s economic growth.”

Hydro Ottawa says it is now reviewing the Ontario Energy Board’s decision to “optimize our 2026-2030 operational plans.”

“We are now focusing our efforts on ensuring every dollar is directed toward our most critical operational requirements while keeping our customers’ needs in mind,” Hydro Ottawa said.

“We remain committed to maintaining a resilient grid that supports our customers’ needs today and into the future while responsibly managing our operations within Hydro Ottawa’s rate framework approved by the OEB.”

In a statement to CTV News Ottawa, Hydro Ottawa noted the OEB approved a $1 billion capital investment plan.

“This billion-dollar commitment ensures we can continue to modernize the grid, support electrification, and replace aging infrastructure to maintain a safe and reliable system for our customers,” the utility said.

Hydro Ottawa said the distribution rate increase was needed for capital investments, “driven by the necessity to modernize and expand the grid to meet evolving community needs and address climate change.” The utility was focusing on four investment areas - growth and electrification – powering a growing community, renewing deteriorating infrastructure, grid modernization – enabling the energy transition, and enhancing resilience.

Hydro Ottawa’s initial proposal called for distribution rates to increase $6.08 a month in 2026, followed by increases of $3.79 a month in 2027, $3.31 a month in 2028, $2.72 a month in 2029 and $2.74 a month in 2030. A tentative proposal in January called for an increase of $5.53 a month in 2026, followed by distribution rates increasing by $2.60 a month in 2027, $2.83 a month in 2028, $1.51 a month in 2029 and $1.38 a month in 2030.

• Sign up now for daily CTV News Ottawa newsletters
• The information you need to know, sent directly to you: Download the CTV News App