40:1 Bill 75, Ontario Electricity System Operator Act, 2012

Bentley, Hon Christopher Minister of Energy

Viewing: Original (current version) pdf

Bill 75                                                          2012

An Act to amend the Electricity Act, 1998 to amalgamate the Independent Electricity System Operator and the Ontario Power Authority, to amend the Ontario Energy Board Act, 1998 and to make complementary amendments to other Acts

Note:  This Act amends or repeals more than one Act.  For the legislative history of these Acts, see the Table of Consolidated Public Statutes – Detailed Legislative History at www.e-Laws.gov.on.ca.

Her Majesty, by and with the advice and consent of the Legislative Assembly of the Province of Ontario, enacts as follows:

Electricity Act, 1998

   1.  Clause 1 (e) of the Electricity Act, 1998 is amended by striking out “generators, retailers and consumers” and substituting “generators, retailers, market participants and consumers”.

   2.  (1)  The definition of “ancillary services” in subsection 2 (1) of the Act is amended by striking out “IESO-controlled grid” and substituting “OESO-controlled grid”.

   (2)  The definition of “charges” in subsection 2 (1) of the Act is repealed and the following substituted:

“charges” means, with respect to the OESO, amounts charged by the OESO, or by a predecessor within the meaning of section 4, to recover amounts paid or payable by the OESO or the predecessor to another person with respect to electricity; (“frais”)

   (3)  The definition of “fees” in subsection 2 (1) of the Act is repealed and the following substituted:

“fees” means, with respect to the OESO, amounts charged by the OESO, or by a predecessor within the meaning of section 4, to recover its costs of operations; (“droits”)

   (4)  The definition of “Governance and Structure By-law” in subsection 2 (1) of the Act is repealed and the following substituted:

“Governance and Structure By-law” means the by-law maintained under subsection 21 (2); (“règlement de régie”)

   (5)  The definitions of “IESO”, “IESO-administered markets” and “IESO-controlled grid” in subsection 2 (1) of the Act are repealed.

   (6)  The definition of “integrated power system” in subsection 2 (1) of the Act is amended by striking out “IESO-controlled grid” wherever it appears and substituting in each case “OESO-controlled grid”.

   (7)  The definition of “market participant” in subsection 2 (1) of the Act is amended,

  (a)  by striking out “IESO-administered markets” and substituting “OESO-administered markets”; and

  (b)  by striking out “IESO-controlled grid” and substituting “OESO-controlled grid”.

   (8)  Subsection 2 (1) of the Act is amended by adding the following definitions:

“OESO” means the Ontario Electricity System Operator; (“SEREO”)

“OESO-administered markets” means the markets established by the market rules; (“marchés administrés par la SEREO”)

“OESO-controlled grid” means the transmission systems with respect to which, pursuant to agreements, the OESO has authority to direct operations; (“réseau dirigé par la SEREO”)

   (9)  The definition of “OPA” in subsection 2 (1) of the Act is repealed.

   (10)  The definition of “procurement contract” in subsection 2 (1) of the Act is repealed and the following substituted:

“procurement contract” means,

  (a)  a contract, entered into or assumed by the OESO pursuant to a direction of the Minister issued under section 25.32 or 25.35, for the procurement of,

           (i)  electricity supply or capacity,

          (ii)  reductions in electricity demand, or

         (iii)  measures related to the conservation of electricity or the management of electricity demand, and

  (b)  a contract entered into by the OESO pursuant to a direction of the Minister issued under subsection 25.32 (4.5) or (4.6); (“contrat d’acquisition”)

   (11)  Section 2 of the Act is amended by adding the following subsections:

Procurement contracts, transition

   (1.5)  For the purposes of this Act, a procurement contract includes,

  (a)  a contract entered into pursuant to section 25.32 as it read immediately before the day subsection 7 (1) of the Ontario Electricity System Operator Act, 2012 comes into force; and

  (b)  a contract entered into pursuant to section 25.35 as it read immediately before the day subsection 10 (1) of the Ontario Electricity System Operator Act, 2012 comes into force.

Procurement contracts, same

   (1.6)  For the purposes of this Act, a procurement contract includes any contract entered into pursuant to a direction of the Minister issued under subsection 25.32 (4.5) or (4.6) as they read immediately before the day subsection 7 (4) of the Ontario Electricity System Operator Act, 2012 comes into force.

Procurement contracts, exceptions

   (1.7)  A transaction, arrangement or agreement entered into by the OESO based on the market rules is deemed not to be a procurement contract for the purposes of this Act.

   (12)  Subsection 2 (7) of the Act is repealed and the following substituted:

References to Ontario Electricity System Operator

   (7)  A reference in a statement mentioned in section 124 or in a regulation, order or rule made under this or any other Act to,

  (a)  the Independent Electricity Market Operator, the Independent Electricity System Operator, the IMO or the IESO is deemed to be a reference to the Ontario Electricity System Operator as continued under this Act unless the context requires otherwise;

  (b)  the IMO-administered markets or IESO-administered markets is deemed to be a reference to the OESO-administered markets;

   (c)  the IMO-controlled grid or the IESO-controlled grid is deemed to be a reference to the OESO-controlled grid; and

  (d)  the Ontario Power Authority or the OPA is deemed to be a reference to the Ontario Electricity System Operator as continued under this Act unless the context requires otherwise.

   3.  (1)  Parts II and II.1 of the Act are repealed and the following substituted:

PART II
Ontario ELECTRICITY SYSTEM OPERATOR

Definitions

   4.  In this Part,

“Independent Electricity System Operator” means the corporation continued under subsection 4 (1) as that subsection read immediately before subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 came into force; (“Société indépendante d’exploitation du réseau d’électricité”)

“Ontario Power Authority” means the corporation established under subsection 25.1 (1) as that subsection read immediately before subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 came into force; (“Office de l’électricité de l’Ontario”)

“predecessor” means either the Independent Electricity System Operator or the Ontario Power Authority. (“entité remplacée”)

Ontario Electricity System Operator

   5.  (1)  The Independent Electricity System Operator and the Ontario Power Authority are amalgamated and shall continue as a corporation without share capital in accordance with this Part, under the name Ontario Electricity System Operator in English and Société d’exploitation du réseau d’électricité de l’Ontario in French.

Composition

   (2)  The OESO is composed of the members of its board of directors.

Separation of functions

   (3)  The board of directors shall take such steps as it considers advisable and appropriate to ensure that there is an effective separation of functions and activities of the OESO relating to,

  (a)  its market operations; and

  (b)  its procurement and contract management activities.

Prohibition

   (4)  The OESO shall not conduct its functions, activities or operations in any manner that could,

  (a)  unduly advantage or disadvantage any market participant or any party to a procurement contract; or

  (b)  interfere with, reduce or impede a market participant’s non-discriminatory access to transmission systems or distribution systems.

Transmission-related information

   (5)  The OESO shall provide transmission-related information on an equal basis and in the same manner to all market participants.

Confidentiality

   (6)  The board of directors shall ensure that appropriate procedures are established and maintained so that confidential information that is in the possession or control of any officers or employees of the OESO, or any agent or third party working on its behalf, is not inappropriately communicated.

Objects

   6.  (1)  The objects of the OESO are,

  (a)  to exercise the powers and perform the duties assigned to it under this Act, the regulations, directions, the market rules and its licence;

  (b)  to enter into agreements with transmitters to give it authority to direct the operation of their transmission systems;

   (c)  to direct the operation and maintain the reliability of the OESO-controlled grid to promote the purposes of this Act;

  (d)  to participate in the development by any standards authority of criteria and standards relating to the reliability of the integrated power system;

  (e)  to establish and enforce criteria and standards relating to the reliability of the integrated power system;

    (f)  to work with the responsible authorities outside of Ontario to co-ordinate the OESO’s activities with the activities of those authorities;

  (g)  to operate the OESO-administered markets to promote the purposes of this Act;

   (h)  to engage in activities related to contracting for the procurement of electricity supply and capacity;

    (i)  to engage in activities related to settlements for any amounts determined under this Act or the Ontario Energy Board Act, 1998;

    (j)  to engage in activities in support of the goal of ensuring adequate, reliable and secure electricity supply and resources in Ontario;

   (k)  to forecast electricity demand and the adequacy and reliability of electricity resources for Ontario for the short term, medium term and long term;

    (l)  to conduct independent planning for electricity generation, demand management, conservation and transmission;

(m)  to engage in activities to facilitate the diversification of sources of electricity supply by promoting the use of cleaner energy sources and technologies, including alternative energy sources and renewable energy sources;

   (n)  to engage in activities in support of system-wide goals for the amount of electricity to be produced from different energy sources;

  (o)  to engage in activities that facilitate load management;

  (p)  to engage in activities that promote electricity conservation and the efficient use of electricity;

  (q)  to assist the Board by facilitating stability in rates for certain types of consumers; and

   (r)  to collect and make public information relating to the short-term, medium-term and long-term electricity needs of Ontario and the adequacy and reliability of the integrated power system to meet those needs.

Not for profit

   (2)  The business and affairs of the OESO shall be carried on without the purpose of gain and any profits shall be used by the OESO for the purpose of carrying out its objects.

Capacity

   (3)  The OESO has the capacity, rights, powers and privileges of a natural person for the purpose of carrying out its objects, except as otherwise limited by this Act.

Limitation on powers, financial

   (4)  The OESO’s powers to borrow, to invest its funds and to manage its financial assets, liabilities and risks are subject to such rules and restrictions as may be prescribed by the regulations.

Dissolution

   7.  If the OESO is dissolved, any property of the OESO remaining after the payment of all of its debts and liabilities is vested in the Crown in right of Ontario.

Not Crown agent

   8.  The OESO is not an agent of the Crown for any purpose, despite the Crown Agency Act.

Board of directors

   9.  (1)  The OESO’s board of directors shall manage and supervise the management of the OESO’s business and affairs.

Composition

   (2)  The board of directors shall be composed of,

  (a)  the chief executive officer of the OESO; and

  (b)  at least eight and not more than 10 additional individuals appointed by the Minister.

Directors to be independent

   (3)  Each director shall hold office as an independent director and not as a representative of any class of persons.

Restriction on persons who may be directors

   (4)  For the purposes of clause (2) (b), no person who is a member of a class of persons prescribed by the regulations may hold office as a director of the OESO.

Term of office and appointment

   (5)  A director appointed in accordance with clause (2) (b) shall hold office at pleasure for an initial term not exceeding two years and, subject to subsection (4), may be reappointed for successive terms not exceeding two years each.

Quorum

   (6)  A majority of the members of the board of directors constitutes a quorum of the board.

Chair

   (7)  The board of directors shall appoint one of its members as chair of the board.

Ceasing to hold office

   (8)  A director ceases to hold office in the circumstances specified in the Governance and Structure By-law.

Chief executive officer

   10.  The board of directors shall appoint a chief executive officer of the OESO.

Director’s duties

   11.  Every director of the OESO shall, in exercising and performing his or her powers and duties as a director,

  (a)  act honestly and in good faith in the best interests of the OESO; and

  (b)  exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.

Conflict of interest

   12.  The directors, officers, employees and agents of the OESO shall comply with any provisions relating to conflict of interest contained in the Governance and Structure By-law or any procedures, rules or codes established pursuant to the By-law.

Board may establish policies, rules, etc.

   13.  (1)  The board of directors may establish policies, rules, guidelines and codes, including codes of conduct, applicable to the directors, officers, employees and agents of the OESO and to members of panels established by the OESO.

Conflict

   (2)  Any provision of a policy, rule, guideline or code that conflicts with this Act, the regulations or the OESO’s by-laws is void.

Delegation of board’s powers

   14.  (1)  The board of directors may, in accordance with the Governance and Structure By-law,

  (a)  delegate any of its powers or duties to a committee of the board or a panel established by the board or to one or more directors; and

  (b)  delegate any of its powers to manage the business and affairs of the OESO to one or more officers of the OESO.

Terms, conditions and restrictions

   (2)  A delegation under subsection (1) is subject to any terms, conditions and restrictions set out in the delegation.

Same

   (3)  A delegation under subsection (1) may be general or specific.

Exceptions

   (4)  The board of directors shall not delegate its power to make by-laws or to approve the financial statements or annual reports of the OESO.

Panels

   15.  (1)  The board of directors may establish such panels as the board considers necessary for the purposes of this Act.

Testimony

   (2)  A member of a panel established for the purpose of resolving or attempting to resolve a dispute between market participants, or a dispute between one or more market participants and the OESO, shall not be required in any civil proceeding to give testimony with respect to information obtained in the course of resolving or attempting to resolve the dispute.

Staff and assistance re panels

   16.  Subject to the by-laws of the OESO, a panel established by the board of directors may use the services of,

  (a)  the OESO’s employees, with the consent of the OESO; and

  (b)  persons other than the OESO’s employees who have technical or professional expertise that is considered necessary.

Stakeholder input

   17.  The OESO may, or when directed by the Minister shall, establish one or more processes by which consumers, distributors, generators, transmitters and other persons who have an interest in the electricity industry may provide advice and recommendations for consideration by the OESO.

Liability

   18.  (1)  No action or other civil proceeding shall be commenced against a director, officer, employee or agent of the OESO or a member of a committee or panel established by the board of directors of the OESO for any act done in good faith in the exercise or performance or the intended exercise or performance of a power or duty under any Act, the regulations under any Act, the OESO’s licence, the OESO’s by-laws or the market rules, or for any neglect or default in the exercise or performance in good faith of such a power or duty.

Same

   (2)  Subsection (1) does not relieve the OESO of any liability to which it would otherwise be subject in respect of a cause of action arising from any act, neglect or default referred to in subsection (1).

Confidential information relating to market participants

   19.  (1)  A record that contains information provided to or obtained by the OESO or a predecessor relating to a market participant and that is designated by the head of the OESO as confidential or highly confidential is deemed for the purpose of section 17 of the Freedom of Information and Protection of Privacy Act to be a record that reveals a trade secret or scientific, technical, commercial, financial or labour relations information, supplied in confidence implicitly or explicitly, the disclosure of which could reasonably be expected to prejudice significantly the competitive position or interfere significantly with the contractual or other negotiations of a person, group of persons, or organization.

Definition

   (2)  In this section,

“head” means the person designated as the head of the OESO in the regulations made under the Freedom of Information and Protection of Privacy Act.

Liability of directors under the Employment Standards Act, 2000

   20.  Part XX of the Employment Standards Act, 2000 does not apply to a director of the OESO.

By-laws

   21.  (1)  The board of directors of the OESO may make by-laws regulating the business and affairs of the OESO.

Governance and Structure By-law

   (2)  The board of directors shall ensure that it maintains a by-law dealing with matters of corporate governance and structure, including,

  (a)  the appointment of the chief executive officer of the OESO;

  (b)  the circumstances in which a director ceases to hold office;

   (c)  the remuneration and benefits of the chair and the other members of the board;

  (d)  conflict of interest;

  (e)  the delegation of the OESO’s powers and duties;

    (f)  the establishment, composition and functions of panels;

  (g)  such other matters as are prescribed by regulation or as are appropriate to the governance and structure of the corporation.

Amendment or repeal of Governance and Structure By-law

   (3)  A by-law that amends or repeals the Governance and Structure By-law shall be filed with the Minister by the board of directors.

Disallowance

   (4)  The Minister may disallow a by-law to which subsection (3) applies by written notice to the board of directors given within 60 days after the by-law is filed with the Minister.

Effective date

   (5)  A by-law to which subsection (3) does not apply comes into force on the day it is made or on such later date as may be specified in the by-law.

Same

   (6)  Subject to subsections (4) and (7), a by-law to which subsection (3) applies comes into force on the earlier of the following dates:

    1.  The expiry of the 60-day period referred to in subsection (4).

    2.  The day on which the Minister notifies the board of directors in writing that he or she will not disallow the by-law.

Same

   (7)  Subject to subsection (4), a by-law to which subsection (3) applies may specify that it comes into force on a day later than the day determined under subsection (6).

Conflict between by-laws

   (8)  In the event of a conflict between the Governance and Structure By-law and another by-law, the Governance and Structure By-law prevails.

Legislation Act, 2006, Part III

   (9)  Part III (Regulations) of the Legislation Act, 2006 does not apply to by-laws made under this section.

Province may purchase securities, etc.

   22.  (1)  The Lieutenant Governor in Council may by order authorize the Minister of Finance to purchase securities of or make loans to the OESO at such times and on such terms and conditions as the Minister of Finance may determine subject to the maximum principal amount and to any other terms and conditions that are specified by the Lieutenant Governor in Council.

Payment from C.R.F.

   (2)  The Minister of Finance may pay out of the Consolidated Revenue Fund any amount required for the purposes of subsection (1).

Delegation

   (3)  In an order under subsection (1), the Lieutenant Governor in Council may delegate any or all of the powers of the Minister of Finance under this section to,

  (a)  an employee in the Ministry of Finance or another ministry;

  (b)  an agency of the Crown; or

   (c)  a lawyer licensed by the Law Society of Upper Canada who is engaged to act for the Minister of Finance.

Fees payable to Minister of Finance

   (4)  The OESO shall pay to the Minister of Finance such fees as are prescribed by the regulations in respect of securities purchased and sums loaned under this section.

Business plan

   23.  (1)  At least 120 days before the beginning of each fiscal year, the OESO shall submit its proposed business plan for the fiscal year to the Minister for approval.

Minister’s approval

   (2)  The Minister may approve the proposed business plan or refer it back to the OESO for further consideration.

Transition

   (3)  Despite subsection (1), the OESO shall submit a business plan in respect of the 2013 fiscal year within 30 days after the Minister requests the plan and the Minister may approve the proposed business plan or refer it back to the OESO for further consideration.

Review of requirements and fees

   24.  (1)  The OESO shall, at least 60 days before the beginning of each fiscal year, submit its proposed expenditure and revenue requirements for the fiscal year and the fees it proposes to charge during the fiscal year to the Board for review, but shall not do so until after the Minister approves the OESO’s proposed business plan for the fiscal year under section 23.

Previous fees continued

   (2)  Until the Board approves the proposed expenditure and revenue requirements for the fiscal year and the fees the OESO proposes to charge during the fiscal year, the fees approved for the previous fiscal year remain in effect unless the Board orders otherwise.

Exception

   (3)  Where the OESO is unable to make its submission under subsection (1) within the time required under that subsection, the OESO shall file its proposed expenditure and revenue requirements for the fiscal year and the fees it proposes to charge during the fiscal year to the Board for review as soon as possible after the Minister has approved its business plan under section 23.

Board’s powers

   (4)  The Board may approve the proposed requirements and the proposed fees or may refer them back to the OESO for further consideration with the Board’s recommendations.

Same

   (5)  In reviewing the OESO’s proposed requirements and proposed fees, the Board shall not take into consideration the remuneration and benefits of the chair and other members of the board of directors of the OESO.

Changes in fees

   (6)  The OESO shall not, without the approval of the Board,

  (a)  establish, eliminate or change any fees it has established; or

  (b)  eliminate or change any fees established by a predecessor that remain in effect.

Hearing

   (7)  The Board may hold a hearing before exercising its powers under this section, but is not required to do so.

Transitional, initial fiscal year

   (8)  Despite subsection (1), the OESO shall submit its proposed expenditure and revenue requirements for its 2013 fiscal year and the fees it proposes to charge during that fiscal year to the Board for review not later than 30 days after the Minister approves the OESO’s proposed business plan for the 2013 fiscal year under section 23, but shall not submit its proposed expenditure and revenue requirements until after the Minister approves the proposed business plan.

Same

   (9)  Until the Board approves the proposed expenditure and revenue requirements for the OESO’s 2013 fiscal year and the fees the OESO proposes to charge during that fiscal year, the OESO shall continue to charge the fees that were approved by the Board and that applied to its predecessors immediately before subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force.

Same

   (10)  For greater certainty, the Board’s orders relating to the predecessors’ revenue and expenditure requirements and fees for their 2012 fiscal year shall continue to be in effect until the Board approves the first expenditure and revenue requirement and fees for the OESO.

Fees

   25.  (1)  The OESO may establish and charge fees to recover,

  (a)  the costs of anything done in connection with the OESO-controlled grid or the OESO-administered markets;

  (b)  the costs of doing anything the OESO is required or permitted to do under this or any other Act; and

   (c)  any other type of expenditure the recovery of which is permitted by the regulations, subject to any limitations and restrictions set out in the regulations.

May recover costs of procurement contracts

   (2)  For greater certainty, the OESO may, subject to the regulations, establish and impose charges to recover from consumers its costs and payments related to procurement contracts.

Board deemed to approve recovery

   (3)  The OESO’s recovery of its costs and payments related to procurement contracts is deemed to be approved by the Board.

Auditor

   25.1  (1)  The board of directors of the OESO shall appoint one or more auditors licensed under the Public Accounting Act, 2004 to audit annually the accounts and transactions of the OESO.

Auditor General

   (2)  The Auditor General may audit the accounts and transactions of the OESO.

Annual report

   25.2  (1)  The OESO shall, within 90 days after the end of every fiscal year, submit to the Minister an annual report on its affairs during that fiscal year, signed by the chair of its board of directors.

Financial statements

   (2)  The audited financial statements of the OESO shall be included in the annual report.

Tabling

   (3)  The Minister shall submit the annual report to the Lieutenant Governor in Council and shall then table the report before the Assembly if it is in session or, if not, deposit the report with the Clerk of the Assembly.

Other persons

   (4)  The OESO may give its annual report to other persons before the Minister complies with subsection (3).

Transitional

   (5)  The board of directors shall prepare and deliver the annual report for the last fiscal year of each of the predecessors within 90 days after the day subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force.

Other reports

   25.3  (1)  The OESO shall submit to the Minister such reports and information as the Minister may require from time to time.

Same

   (2)  The OESO shall submit to the Minister of Finance such reports and information as the Minister of Finance may require from time to time.

Information to Board, etc.

   25.4  (1)  The OESO shall provide the Board and the Market Surveillance Panel with such information as the Board or Panel may require from time to time.

Same

   (2)  Without limiting the generality of subsection (1), the OESO shall provide the Board and the Market Surveillance Panel with such information relating to any actual or potential conflict of interest related to the actions, operations or functions of the OESO as the Board or Panel may require from time to time.

Application of corporations statutes

   25.5  Except as otherwise provided by the regulations, the Business Corporations Act, the Corporations Act and the Corporations Information Act do not apply to the OESO.

Statutory Powers Procedure Act

   25.6  The Statutory Powers Procedure Act does not apply to a proceeding before the OESO, its board of directors or any committee, panel, person or body to which a power or duty has been delegated under this Part.

Transitional Matters

Transition, corporate matters

   25.7  (1)  The following occurs when subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force:

    1.  The Independent Electricity System Operator and the Ontario Power Authority cease to exist as entities separate from the OESO.

    2.  All rights, property and assets that belong to the Independent Electricity System Operator and the Ontario Power Authority immediately before the subsection comes into force become the rights, property and assets of the OESO.

    3.  All outstanding debts, liabilities and obligations of the Independent Electricity System Operator and the Ontario Power Authority immediately before the subsection comes into force become the debts, liabilities and obligations of the OESO.

    4.  The members of the boards of directors of the Independent Electricity System Operator and the Ontario Power Authority holding office immediately before the subsection comes into force cease to be members of their respective board of directors when the subsection comes into force, but nothing in this paragraph prevents them from being appointed to the board of directors of the OESO.

    5.  An individual who ceases to hold office as director by reason of paragraph 4 has no right of recourse against the Crown or any person.

    6.  The by-laws of the Independent Electricity System Operator in effect immediately before the subsection comes into force become the by-laws of the OESO.

    7.  Any licence issued by the Board to the Independent Electricity System Operator or the Ontario Power Authority in effect immediately before the subsection comes into force is deemed to be a licence issued by the Board to the OESO and remains in effect until amended or revoked.

    8.  An agreement, security, licence, approval, permit or other instrument to which the Independent Electricity System Operator or the Ontario Power Authority is a party immediately before the subsection comes into force has effect after the subsection comes into force as if,

            i.  the OESO were substituted for the Independent Electricity System Operator or the Ontario Power Authority, as the case requires, as a party to the agreement, security, licence, approval, permit or other instrument, and

           ii.  any reference in the agreement, security, licence, approval, permit or other instrument to the Independent Electricity System Operator or the Ontario Power Authority were a reference to the OESO.

    9.  The OESO is a party to each on-going proceeding to which the Independent Electricity System Operator or the Ontario Power Authority is a party immediately before the subsection comes into force, replacing the Independent Electricity System Operator or the Ontario Power Authority, as the case may be.

  10.  Any direction issued by the Minister under section 25.32 or 25.35, as those provisions read immediately before the subsection comes into force, remain in force and in effect in respect of the OESO.

Same, par. 3 of subs. (1)

   (2)  The operation of paragraph 3 of subsection (1),

  (a)  does not constitute a breach, termination or repudiation of the debt, liability or obligation or the frustration of any agreement related to the debt, liability or obligation or an event of default or force majeure; and

  (b)  does not constitute or give rise to any estoppel or any right to terminate or repudiate an agreement related to the debt, liability or obligation.

Same, par. 8 of subs. (1)

   (3)  The operation of paragraph 8 of subsection (1),

  (a)  does not constitute a breach, termination or repudiation of the agreement, security, licence, approval, permit or other instrument or the frustration of the agreement or an event of default or force majeure; and

  (b)  does not constitute or give rise to any estoppel or any right to terminate or repudiate an agreement, security, licence, approval, permit or other instrument.

Same, references

   (4)  A reference to the Independent Electricity System Operator or the Ontario Power Authority in any by-law, resolution, agreement or other document shall be read as if it were a reference to the OESO.

Transition, employment matters

   25.8  (1)  All individuals who were employees of the Independent Electricity System Operator or the Ontario Power Authority immediately before subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force become employees of the OESO when the subsection comes into force.

Agreements

   (2)  All employment agreements to which the Independent Electricity System Operator or the Ontario Power Authority was a party and that were in effect immediately before subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force continue in effect after the subsection comes into force as if the OESO were substituted for the Independent Electricity System Operator or the Ontario Power Authority, as the case may be, as a party to the agreement.

Same

   (3)  The operation of subsections (1) and (2) does not constitute a breach, termination, repudiation or the frustration of an employment agreement.

Transition, governance and other matters

   25.9  (1)  This section applies in respect of the governance of the OESO and other matters concerning the OESO on the day subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force.

Chief executive officer

   (2)  Despite sections 10 and 25.8, the chief executive officers of the predecessors cease to hold office on the day subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force and the Minister shall appoint the first chief executive officer of the OESO, but nothing in this subsection prevents the board of directors of the OESO from appointing any subsequent chief executive officer.

Panels

   (3)  A panel established under section 13 or 25.10 as they read immediately before the day subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force is continued after that subsection comes into force and is deemed to be a panel established by the OESO board of directors under subsection 15 (1).

Stakeholder input

   (4)  Any process established under section 13.2 or 25.12 as they read immediately before the day subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force is continued after that subsection comes into force and is deemed to be a process established by the OESO under section 17.

Fees

   (5)  Any fee payable to a predecessor that remains unpaid on the day subsection 3 (1) of the Ontario Electricity System Operator Act, 2012 comes into force is payable to the OESO at the same time and on the same terms as if the OESO were the predecessor.

Market rules

   (6)  Any market rule established under section 32 as it read immediately before the day subsection 3 (1) of theOntario Electricity System Operator Act, 2012 comes into force remains in effect after that subsection comes into force and is deemed to be a market rule established by the OESO until it is amended or revoked in accordance with this Act.

   (2)  Section 25.5 of the Act, as re-enacted by subsection (1), is amended by striking out “the Corporations Act” and substituting “the Not-for-Profit Corporations Act, 2010”.

   4.  (1)  Subsection 25.29 (1) of the Act is amended by striking out “The OPA” at the beginning and substituting “The OESO”.

   (2)  Subsection 25.29 (2) of the Act is amended by striking out “the OPA” and substituting “the OESO”.

   (3)  Section 25.29 of the Act is amended by adding the following subsections:

Reporting

   (3)  When directed to do so by the Minister or at the times prescribed by the regulations, the OESO shall report back to the Minister about the assessment activities it has conducted under subsection (1) in relation to short-term, medium-term and long-term planning.

Assessment periods

   (4)  A regulation referred to in subsection (1) may prescribe one or more assessment periods, including assessment periods relating to the short term, medium term and long term.

   5.  Section 25.30 of the Act is repealed and the following substituted:

Energy plans

   25.30  (1)  The Minister may, in consultation with the OESO or any other person, develop and, with the approval of the Lieutenant Governor in Council, issue energy plans.

Same, impact on consumers’ electricity bills

   (2)  In developing the energy plan and before issuing it, the Minister shall consult with the Board on the impact of the implementation of the energy plan on a consumer’s electricity bill and on methods of managing the impact. 

Same, goals

   (3)  The energy plans may include the Government of Ontario’s goals relating to,

  (a)  the adequacy and reliability of electricity supply and capacity, including electricity supply and capacity from alternative energy sources and renewable energy sources;

  (b)  generation and transmission;

   (c)  electricity demand management and conservation;

  (d)  the production of electricity from particular combinations of energy sources and generation technologies;

  (e)  the development and implementation of conservation measures, programs and targets on a system-wide basis or in particular service areas; and

    (f)  such other matters as may be prescribed by the regulations.

Publication

   (4)  The Minister shall ensure that the energy plans issued under subsection (1) are posted on the website of the Ministry of Energy or published in some other manner.

Referral to Board

   (5)  The Minister shall refer an energy plan to the Board for the Board’s review of the estimated capital costs in the plan and the Minister may require the  Board to review any other part of the energy plan in the referral, and the Board shall proceed in accordance with the referral.

Same

   (6)  The Minister may give such directions and impose such conditions on a referral under subsection (5) as the Minister considers appropriate, and the Minister may amend the referral.

Legislation Act, 2006, Part III

   (7)  Part III (Regulations) of the Legislation Act, 2006 does not apply to energy plans under this section.

   6.  Section 25.31 of the Act is repealed.

   7.  (1)  Subsection 25.32 (1) of the Act is repealed and the following substituted:

Directions re procurement

   (1)  The Minister may direct the OESO,

  (a)  to enter into a procurement contract; or

  (b)  to undertake any request for proposals, other form of procurement solicitation or any other initiative or activity in respect of a procurement contract.

Crown procurements, initiatives, transferred to OESO

   (1.1)  The Minister may direct the OESO to assume all rights and obligations of the Crown in respect of matters referred to in clauses (1.2) (a) and (b), as of such date as the Minister considers appropriate, including responsibility for exercising all powers and performing all duties,

  (a)  of the Crown; or

  (b)  an agency of the Crown.

Same

   (1.2)  The powers and duties of the Crown include the powers and duties,

  (a)  under any request for proposals, draft request for proposals, another form of procurement solicitation issued by the Crown or through an agency of the Crown or any other initiative pursued by the Crown or through an agency of the Crown that relates to a procurement contract; and

  (b)  under any contract entered into by the Crown or an agency of the Crown pursuant to a procurement solicitation or other initiative referred to in clause (a).

OESO to enter into contract

   (1.3)  The OESO shall enter into any contract following a procurement solicitation or other initiative referred to in subsection (1) or clause (1.2) (a) or (b), if directed to do so by the Minister, and the contract is deemed to be a procurement contract.

Release of the Crown, etc.

   (1.4)  As of the day specified in the Minister’s direction under subsection (1.1), the OESO shall assume responsibility in accordance with that subsection and the Crown and any Crown agency included in that subsection are released from any and all liabilities and obligations with respect to the matters for which the OESO has assumed responsibility.

   (2)  Subsection 25.32 (2) of the Act is amended,

  (a)  by striking out “The OPA” at the beginning and substituting “The OESO”; and

  (b)  by striking out “subsection (4), (4.1), (4.4), (4.5), (4.6) or (4.7) or section 25.35” in clause (b) and substituting “this section or section 25.35”.

   (3)  Subsections 25.32 (4), (4.1), (4.2) and (4.3) of the Act are repealed and the following substituted:

Referral of procurement contracts, etc.

   (4)  The Minister may refer or require the OESO to refer any contract or any part of a contract related to a procurement solicitation or other initiative entered into pursuant to this section to the Board and the Board shall proceed in accordance with the referral.

Directions and conditions on referral

   (4.1)  The Minister may give such directions or impose such conditions on a referral referred to in subsection (4) as the Minister considers appropriate, and the Minister may amend the referral. 

Direction re process

   (4.2)  The Minister may, as part of a direction under subsection (1) or (1.1), specify that the OESO is to use a competitive or a non-competitive process as part of the initiative or activity.

Direction re pricing

   (4.3)  A direction issued by the Minister under subsection (1) or (1.1) may allow the Minister to specify the pricing or other economic factors to be used or achieved by the OESO.

   (4)  Subsections 25.32 (4.4), (4.5) and (4.6) of the Act are amended by striking out “the OPA” wherever it appears and substituting in each case “the OESO”.

   (5)  Subsections 25.32 (4.7), (5), (6) and (7) of the Act are repealed.

   8.  (1)  Subsection 25.33 (1) of the Act is repealed and the following substituted:

Electricity pricing to reflect costs

OESO to make adjustments

   (1)  The OESO shall, through its billing and settlement systems, make adjustments in accordance with the regulations that ensure that, over time, payments by classes of market participants in Ontario that are prescribed by regulation reflect,

  (a)  amounts paid or payable to generators, the Financial Corporation and distributors, whether the amounts are determined under the market rules or under section 78.1, 78.2 or 78.5 of the Ontario Energy Board Act, 1998; and

  (b)  amounts paid or payable to entities with whom the OESO has a procurement contract, as determined under the procurement contract.

   (2)  Subsection 25.33 (2) of the Act is repealed and the following substituted:

Distributors and retailers to make adjustments

   (2)  Distributors and retailers shall, through their billing systems, make adjustments in accordance with the regulations that ensure that, over time, payments by classes of consumers in Ontario that are prescribed by regulation reflect,

  (a)  amounts paid or payable to generators, the Financial Corporation and distributors, whether the amounts are determined under the market rules or under section 78.1, 78.2 or 78.5 of the Ontario Energy Board Act, 1998; and

  (b)  amounts paid or payable to entities with whom the OESO has a procurement contract, as determined under the procurement contract.

   (3)  Subsection 25.33 (3) of the Act is amended by striking out “the OPA” in the portion before the paragraphs and substituting “the OESO”.

   (4)  Subsection 25.33 (4) of the Act is amended by striking out “The OPA, the IESO” at the beginning and substituting “The OESO”.

   (5)  Subsection 25.33 (5) of the Act is amended by striking out “The OPA” at the beginning and substituting “The OESO”.

   9.  Section 25.34 of the Act is repealed.

   10.  (1)  Subsection 25.35 (1) of the Act is amended by striking out “the OPA” and substituting “the OESO”.

   (2)  Subsection 25.35 (2) of the Act is amended by striking out “the OPA shall follow” in the portion before clause (a) and substituting “the OESO shall follow”.

   (3)  Subsection 25.35 (3) of the Act is amended by striking out “the OPA shall follow” and substituting “the OESO shall follow”.

   11.  (1)  Subsection 25.37 (1) of the Act is amended by striking out “A distributor, transmitter, the OPA and the IESO” at the beginning and substituting “A distributor, transmitter and the OESO”.

   (2)  Subsection 25.37 (2) of the Act is amended by striking out “the IESO market rules” and substituting “the market rules”.

   (3)  Subsection 25.37 (3) of the Act is amended by striking out “The IESO” at the beginning and substituting “The OESO”.

   12.  Subsection 26 (1) of the Act is amended by striking out “generators, retailers and consumers” and substituting “generators, retailers, market participants and consumers”.

   13.  Section 27 of the Act is amended by striking out “IESO-controlled grid” and substituting “OESO-controlled grid”.

   14.  Subsection 29.1 (1) of the Act is amended by striking out “or the OPA” in the portion before clause (a) and substituting “or the OESO”.

   15.  (1)  Subsection 32 (1) of the Act is amended,

  (a)  by striking out “IESO” in the portion before clause (a) and substituting “OESO”; and

  (b)  by striking out “IESO-controlled grid” wherever it appears in clauses (a) and (c) and substituting in each case “OESO-controlled grid”.

   (2)  Subsection 32 (2) of the Act is amended,

  (a)  by striking out “IESO-controlled grid” wherever it appears and substituting in each case “OESO-controlled grid”;

  (b)  by striking out “IESO” wherever it appears and substituting in each case “OESO”; and

  (c)  by striking out “IESO-administered markets” wherever it appears and substituting in each case “OESO-administered markets”.

   (3)  Subsection 32 (5) of the Act is amended by striking out “IESO” wherever it appears and substituting in each case “OESO”.

   (4)  Subsection 32 (6) of the Act is amended by striking out “IESO” and substituting “OESO”.

   16.  (1)  Subsection 33 (1) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (2)  Subsection 33 (2) of the Act is amended by striking out “IESO” wherever it appears and substituting in each case “OESO”.

   (3)  Subsection 33 (3) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (4)  Clause 33 (9) (b) of the Act is amended by striking out “IESO” and substituting “OESO”.

   17.  (1)  Subsection 34 (1) of the Act is amended by striking out “IESO” in the portion before paragraph 1 and substituting “OESO”.

   (2)  Subsection 34 (2) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (3)  Subsection 34 (2.1) of the Act is amended by striking out “IESO” wherever it appears and substituting in each case “OESO”.

   (4)  Subsection 34 (2.2) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (5)  Clause 34 (6) (a) of the Act is amended by striking out “IESO” and substituting “OESO”.

   18.  (1)  Subsection 35 (6) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (2)  Subsection 35 (7) of the Act is amended by striking out “IESO” and substituting “OESO”.

   19.  (1)  Subsection 36 (1) of the Act is amended,

  (a)  by striking out “IESO-administered markets” wherever it appears and substituting in each case “OESO-administered markets”; and

  (b)  by striking out “IESO-controlled grid” wherever it appears and substituting in each case “OESO-controlled grid”.

   (2)  Clause 36 (6) (c) of the Act is amended by striking out “IESO” and substituting “OESO”.

   20.  (1)  Subsection 36.1 (1) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (2)  Subsection 36.1 (2) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (3)  Subsection 36.1 (3) of the Act is amended,

  (a)  by striking out “IESO” and substituting “OESO”; and

  (b)  by striking out “the IESO’s board” and substituting “the OESO’s board” in the English version.

   (4)  Subsection 36.1 (10) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (5)  Subsection 36.1 (17) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (6)  Subsection 36.1 (18) of the Act is amended by striking out “The IESO’s directors” at the beginning and substituting “The OESO’s directors”.

   21.  (1)  Subsection 36.2 (1) of the Act is amended by striking out “IESO” wherever it appears and substituting in each case “OESO”.

   (2)  Subsection 36.2 (2) of the Act is amended by striking out “IESO” and substituting “OESO”.

   22.  (1)  Subsection 36.3 (1) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (2)  Subsection 36.3 (2) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (3)  Clauses 36.3 (7) (a), (b) and (c) of the Act are amended by striking out “IESO’s licence” wherever it appears and substituting in each case “OESO’s licence”.

   23.  (1)  Subsection 37 (1) of the Act is amended by striking out “IESO-administered markets” and substituting “OESO-administered markets”.

   (2)  Subsection 37 (16) of the Act is amended by striking out “IESO” and substituting “OESO”.

   24.  (1)  Subsection 38 (1) of the Act is amended by striking out “IESO” wherever it appears and substituting in each case “OESO”.

   (2)  Subsection 38 (2) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (3)  Clause 38 (4) (b) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (4)  Subsection 38 (5) of the Act is amended by striking out “IESO” and substituting “OESO”.

   25.  (1)  Subsection 39 (1) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (2)  Subsection 39 (3) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (3)  Subsection 39 (4) of the Act is amended by striking out “IESO” and substituting “OESO”.

   26.  Subsection 48.1 (1) of the Act is amended by striking out “IESO-controlled grid” and substituting “OESO-controlled grid”.

   27.  Paragraph 4 of section 53.8 of the Act is amended by striking out “the OPA” in the portion before subparagraph i and substituting “the OESO”.

   28.  Section 83 of the Act is amended by striking out “the Corporations Act” andsubstituting “the Not-for-Profit Corporations Act, 2010”.

   29.  Clause 86 (1) (b) of the Act is amended by striking out “the Corporations Act” and substituting “the Not-for-Profit Corporations Act, 2010”.

   30.  (1)  Clauses 114 (1) (a), (a.1), (b) and (c) of the Act are repealed and the following substituted:

  (a)  governing the OESO’s borrowing, investment of funds and the management of its financial assets, liabilities and risks, including,

           (i)  prescribing rules and restrictions that apply to borrowing, investment and management of financial assets, liabilities and risks,

          (ii)  prescribing purposes for which the OESO may borrow, invest or manage its financial assets, liabilities and risks,

         (iii)  prescribing the types of debt instruments and financial obligations that the OESO can issue or enter into for or in relation to borrowing,

         (iv)  prescribing classes of securities, investment instruments and financial agreements that the OESO is authorized to invest in or enter into or is not authorized to invest in or enter into;

  (b)  prescribing classes of persons for the purposes of subsection 9 (4);

   (c)  prescribing other matters that are to be dealt with in the Governance and Structure By-law;

(c.1) respecting the calculation of the fees referred to in subsection 22 (4) and respecting the manner in which and the time at which they are to be paid;

(c.2) prescribing the types of expenditures the OESO may recover through fees and charges and any restrictions and limitations in respect of the recovery of an expenditure;

(c.3) respecting the calculation of the fees and charges referred to in section 25 and respecting the manner in which and the time at which they are collected by the OESO;

(c.4) prescribing provisions of the Business Corporations Act, the Corporations Act or the Corporations Information Act that apply, with necessary modifications, to the OESO;

   (2)  Clause 114 (1) (c.4) of the Act, as enacted by subsection (1), is amended by striking out “the Corporations Act” and substituting “the Not-for-Profit Corporations Act, 2010”.

   (3)  Subsection 114 (1) of the Act is amended by adding the following clause:

(o.1) prescribing anything referred to in this Act as prescribed by the regulations or prescribed;

   (4)  Subsection 114 (1.2) of the Act is repealed.

   (5)  Clauses 114 (1.3) (a), (b), (c) and (d) of the Act are repealed and the following substituted:

  (a)  governing assessment periods for the purposes of section 25.29;

  (b)  prescribing the times at which the OESO is to report back to the Minister about its assessment activities;

   (c)  governing energy plans for the purposes of section 25.30, including,

           (i)  governing other matters for the purposes of clause 25.30 (3) (f),

          (ii)  prescribing any other matter relating to energy plans that the Lieutenant Governor in Council considers necessary or advisable;

   (6)  Subclauses 114 (1.3) (f) (i) and (ii) of the Act are repealed and the following substituted:

           (i)  prescribing methods for determining the amounts of adjustments under subsection 25.33 (1), the classes of market participants and consumers to whom those adjustments apply, the time periods to which the adjustments apply and the time periods within which the adjustments must or may be made and the manner in which the amounts are paid to generators, the Financial Corporation, distributors and other entities,

          (ii)  prescribing adjustments that must or may be made by distributors or retailers with respect to classes of consumers or other distributors or retailers, methods for determining the amount of the adjustments, the time periods to which the adjustments apply and the time periods within which the adjustments must or may be made and the manner in which the amounts are paid to generators, the Financial Corporation, distributors and other entities,

   (7)  Subclauses 114 (1.3) (f) (v), (vi), (vii) and (viii) of the Act are repealed and the following substituted:

          (v)  requiring the OESO to make payments to a distributor or retailer and prescribing methods for determining the amounts payable,

         (vi)  requiring a distributor to make payments to the OESO, another distributor or a retailer and prescribing methods for determining the amounts payable,

        (vii)  requiring a retailer to make payments to the OESO or a distributor and prescribing methods for determining the amounts payable,

   (8)  Subclauses 114 (1.3) (f) (xii), (xiii) and (xiv) of the Act are repealed and the following substituted:

        (xii)  requiring a distributor, retailer or generator to provide information to the OESO, a distributor or the Board for the purposes of section 25.33 or a regulation made under this clause,

       (xiii)  requiring the OESO to provide information to the Board for the purposes of section 25.33 or a regulation made under this clause,

       (xiv)  requiring the Financial Corporation or other entities to provide information to the OESO or the Board for the purposes of section 25.33 or a regulation made under this clause,

   (9)  Subclause 114 (1.3) (f) (xv) of the Act is amended by striking out “the IESO” and substituting “the OESO”.

   (10)  Clause 114 (1.3) (g.1) of the Act is amended by striking out “the OPA” and substituting “the OESO”.

   (11)  Clause 114 (1.3) (h) of the Act is repealed.

   (12)  Subsection 114 (2) of the Act is amended by striking out “subsection (1), (1.2) or (1.3)” and substituting “subsection (1) or (1.3)”.

   (13)  Subsection 114 (5) of the Act is amended by striking out “clause (1.2) (b) or (1.3) (f) or (h)” and substituting “clause (1) (a) or (1.3) (f)”.

   (14)  Subsection 114 (6) of the Act is amended by striking out “subclause (1.3) (f) (xii) or (xiii) or (h) (ix) or (x)” and substituting “subclause (1.3) (f) (xii) or (xiii)”.

   (15)  Subsection 114 (7) of the Act is amended by striking out “clause (1.3) (f) or (h)” and substituting “clause (1.3) (f)”.

   (16)  Section 114 of the Act is amended by adding the following subsections:

Transitional, OESO

   (9)  The Lieutenant Governor in Council may make regulations governing transitional matters that, in the opinion of the Lieutenant Governor in Council, are necessary or desirable to facilitate,

  (a)  the amalgamation of the Independent Electricity System Operator and the Ontario Power Authority; and

  (b)  the merging or segregation within the OESO of any of the duties, functions or activities of the Independent Electricity System Operator and the Ontario Power Authority.

Same, pension matters

   (10)  Without limiting the generality of subsection (9), the Lieutenant Governor in Council may make regulations governing transitional matters with respect to pensions, including regulations,

  (a)  respecting the right to continue a prescribed pension plan as a pension plan for the employees of OESO and any persons who become employees of OESO in the future;

  (b)  governing the right of OESO to create a new pension plan for its employees;

   (c)  respecting the right of the board of directors of the OESO to determine which employees will be members of a prescribed pension plan or a new pension plan created under the regulations made under this subsection;

  (d)  governing any matters relating to a prescribed pension plan or any new pension plans created under the regulations made under this subsection.  

Ontario Energy Board Act, 1998

   31.  Subsection 1 (2) of the Ontario Energy Board Act, 1998 is repealed and the following substituted:

Facilitation of implementation of energy plans

   (2)  In exercising its powers and performing its duties under this or any other Act in relation to electricity, the Board shall facilitate the implementation of all energy plans issued under the Electricity Act, 1998.

   32.  (1)  Clause (d) of the definition of “enforceable provision” in section 3 of the Act is repealed and the following substituted:

  (d)  subsection 5 (3), (4), (5) or (6) or section 25.33, 25.36, 25.37, 26, 27, 28, 28.1, 29, 30.1, 31, 53.11, 53.13, 53.15, 53.16 or 53.18 of the Electricity Act, 1998, or any other provision of that Act that is prescribed by the regulations,

   (2)  The definition of “IESO” in section 3 of the Act is repealed.

   (3)  Section 3 of the Act is amended by adding the following definitions:

“OESO” means the Ontario Electricity System Operator and has the same meaning as in the Electricity Act, 1998; (“SEREO”)

“OESO-administered markets” means the markets established by the market rules made under the Electricity Act, 1998; (“marchés administrés par la SEREO”)

   (4)  The definition of “OPA” in section 3 of the Act is repealed.

   33.  (1)  Clause 4.3.1 (3) (b) of the Act is amended by striking out “IESO-administered markets” and substituting “OESO-administered markets”.

   (2)  Clauses 4.3.1 (3) (e) and (f) of the Act are repealed and the following substituted:

  (e)  the OESO; or

   (3)  Clause 4.3.1 (3) (g) of the Act is amended by striking out “clause (a), (b), (c), (e) or (f)” and substituting “clause (a), (b), (c) or (e)”.

   (4)  Subsections 4.3.1 (5) and (6) of the Act are amended by striking out “IESO” wherever it appears and substituting in each case “OESO”.

   (5)  Subsection 4.3.1 (7) of the Act is amended by striking out “IESO-administered markets” and substituting “OESO-administered markets”.

   34.  Section 4.15 of the Act is amended by striking out “The Corporations Act” at the beginning and substituting “The Not-for-Profit Corporations Act, 2010”.

   35.  Paragraph 4 of subsection 11 (1) of the Act is amended by striking out “IESO” and substituting “OESO”.

   36.  Paragraph 2 of subsection 26.1 (1) and subsection 26.1 (3) of the Act are amended by striking out “IESO” wherever it appears and substituting in each case “OESO”.

   37.  (1)  Subsection 27.2 (3) of the Act is amended by striking out “OPA” and substituting “OESO”.

   (2)  Subsection 27.2 (5) of the Act is repealed and the following substituted:

Directives, contracting with the OESO

   (5)  A directive may require the Board to specify, as a condition of a licence, that a distributor meet, at its discretion, any portion of its conservation target by contracting with the OESO to meet the target through province-wide programs offered by the OESO.

   38.  (1)  The definition of “ancillary services” in section 56 of the Act is amended by striking out “IESO-controlled grid” and substituting “OESO-controlled grid”.

   (2)  The definitions of “IESO-administered markets” and “IESO-controlled grid” in section 56 of the Act are repealed.

   (3)  The definition of “market participant” in section 56 of the Act is amended,

  (a)  by striking out “IESO-administered markets” and substituting “OESO-administered markets”; and

  (b)  by striking out “IESO-controlled grid” and substituting “OESO-controlled grid”.

   (4)  Section 56 of the Act is amended by adding the following definition:

“OESO-controlled grid” means the transmission systems with respect to which, pursuant to agreements, the OESO has authority to direct operations; (“réseau dirigé par la SEREO”)

   39.  (1)  Section 57 of the Act is amended by striking out “OPA” in the portion before clause (a) and substituting “OESO”.

   (2)  Clauses 57 (c), (e) and (f) of the Act are amended by striking out “IESO-administered markets” wherever it appears and substituting in each case “OESO-administered markets”.

   40.  (1)  Clauses 70 (2) (j) and (k) of the Act are amended by striking out “IESO” wherever it appears and substituting in each case “OESO”.

   (2)  Clause 70 (2) (l) of the Act is amended by striking out “an integrated power system plan” and substituting “an energy plan”.

   (3)  Clause 70 (5) (a) of the Act is amended by striking out “IESO-administered markets” and substituting “OESO-administered markets”.

   (4)  Subsections 70 (7) and (8) of the Act are repealed and the following substituted:

Requirement to provide information

   (7)  Every licence, other than a licence issued to the OESO, is deemed to contain a condition that the licensee is required to provide such reasonable information to the OESO as the OESO may require, in the manner and form specified by the OESO.

   41.  (1)  Subsection 78 (3.0.4) of the Act is amended by striking out “OPA” and substituting “OESO”.

   (2)  Clause 78 (3.3) (b) of the Act is amended by striking out “the OPA’s variance accounts” and substituting “the OESO’s variance accounts”.

   42.  Subsections 78.1 (1), (2) and (3) of the Act are repealed and the following substituted:

Payments to prescribed generator

   (1)  The OESO shall make payments to a generator prescribed by the regulations with respect to output that is generated by a unit at a generation facility prescribed by the regulations.

Payment amount

   (2)  Each payment referred to in subsection (1) shall be the amount determined in accordance with the order of the Board then in effect.

   43.  (1)  Subsection 78.2 (1) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (2)  Subsection 78.2 (3) of the Act is repealed.

   44.  Sections 78.3 and 78.4 of the Act are repealed.

   45.  (1)  Subsection 78.5 (1) of the Act is repealed and the following substituted:

Payments to distributors under conservation and demand management programs

   (1)  The OESO shall make payments to a distributor with respect to amounts approved by the Board for conservation and demand management programs approved by the Board pursuant to a directive issued under section 27.2.

   (2)  Subsection 78.5 (4) of the Act is repealed.

   46.  Section 78.6 of the Act is amended by striking out “sections 78.1 to 78.5” and substituting “sections 78.1, 78.2 and 78.5”.

   47.  (1)  Subclause 79.16 (4) (a) (ii) of the Act is amended by striking out “the IESO” at the beginning and substituting “the OESO”.

   (2)  Subsection 79.16 (5) of the Act is amended by striking out “IESO-controlled grid” and substituting “OESO-controlled grid”.

   48.  (1)  Clause 88 (1) (b) of the Act is amended by striking out “IESO” and substituting “OESO”.

   (2)  Subclause 88 (1) (g.7) (ii) of the Act is amended by striking out “the OPA” at the end and substituting “the OESO”.

   (3)  Clauses 88 (1) (i.4) and (i.5) of the Act are repealed.

   (4)  Clauses 88 (1) (i.10) and (i.11) of the Act are repealed.

   49.  Section 88.0.1 of the Act is repealed.

   50.  Paragraphs 5 and 6 of subsection 107 (2) of the Act are repealed and the following substituted:

    5.  Adjustments, payments, set-offs and credits under section 25.33 of the Electricity Act, 1998 and under the regulations made under clause 114 (1.3) (f) of that Act.

    6.  Payments under sections 78.1, 78.2 and 78.5.

   51.  Clause 127 (1) (j.17) of the Act is repealed and the following substituted:

(j.17)   prescribing provisions of the Electricity Act, 1998 for the purpose of clause (d) of the definition of “enforceable provision” in section 3;

Complementary Amendments

Broader Public Sector Accountability Act, 2010

   52.  (1)  Clauses 4 (2) (e) and (f) of the Broader Public Sector Accountability Act, 2010 are repealed and the following substituted:

  (e)  Ontario Electricity System Operator; and

   (2)  This subsection and subsections (3) and (4) apply only if Bill 55 (Strong Action for Ontario Act (Budget Measures), 2012), introduced on March 27, 2012, receives Royal Assent.

   (3)  References in this section to provisions of Bill 55 are references to those provisions as they were numbered in the first reading version of the Bill.

   (4)  On the later of the day this subsection comes into force and the day section 1 of Schedule 5 to Bill 55 comes into force, section 7.2 of the Broader Public Sector Accountability Act, 2010, as enacted by section 1 of Schedule 5 to Bill 55, is amended by adding the following paragraph:

  5.1  Ontario Electricity System Operator.

Environmental Bill of Rights, 1993

   53.  Paragraphs 2 and 3 of subsection 58.1 (3) of the Environmental Bill of Rights, 1993 are repealed and the following substituted:

    2.  The Ontario Electricity System Operator.

Lobbyists Registration Act, 1998

   54.  The definition of “public office holder” in subsection 1 (1) of the Lobbyists Registration Act, 1998 is amended by adding “or” at the end of subclause (f) (ii) and by repealing subclauses (f) (iii) and (iv) and substituting the following:

         (iii)  Ontario Electricity System Operator;

Ministry of Energy Act, 2011

   55.  Clause 7 (1) (a) of the Ministry of Energy Act, 2011 is amended by striking out “both short-term and long-term goals” and substituting “short-term, medium-term and long-term goals”.

Ontario Clean Energy Benefit Act, 2010

   56.  (1)  The definition of “electricity vendor” in subsection 2 (1) of the Ontario Clean Energy Benefit Act, 2010 is amended by striking out “IESO” and substituting “OESO”.

   (2)  The definition of “IESO” in subsection 2 (1) of the Act is repealed.

   (3)  Subsection 2 (1) of the Act is amended by adding the following definition:

“OESO” means the Ontario Electricity System Operator and has the same meaning as in the Electricity Act, 1998; (“SEREO”)

   (4)  Clauses 6 (2) (b) and (i) of the Act are amended by striking out “IESO” wherever it appears and substituting in each case “OESO”.

Provincial Parks and Conservation Reserves Act, 2006

   57.  (1)  Subsection 19 (2) of the Provincial Parks and Conservation Reserves Act, 2006 is repealed and the following substituted:

Exception, not connected to OESO-controlled grid

   (2)  Despite section 16 and subject to the approval of the Minister, facilities for the generation of electricity may be developed in provincial parks and conservation reserves for use within communities that are not connected to the OESO-controlled grid.

   (2)  Subsection 19 (5) of the Act is repealed and the following substituted:

Definitions

   (5)  In this section,

“OESO” means the Ontario Electricity System Operator under the Electricity Act, 1998; (“SEREO”)

“OESO-controlled grid” means the transmission systems with respect to which, pursuant to agreements, the OESO has authority to direct operations. (“réseau dirigé par la SEREO”)

Commencement and Short Title

Commencement

   58.  (1)  Subject to subsections (2), (3), (4), (5) and (6), this Act comes into force on a day to be named by proclamation of the Lieutenant Governor.

   (2)  Subsection 3 (2) comes into force on the later of the day subsection 4 (1) of the Not-for-Profit Corporations Act, 2010 comes into force and the day subsection 3 (1) of this Act comes into force.

   (3)  Section 28 comes into force on the later of the day subsection 4 (1) of the Not-for-Profit Corporations Act, 2010 comes into force and the day this Act receives Royal Assent.

   (4)  Section 29 comes into force on the later of the day subsection 4 (1) of the Not-for-Profit Corporations Act, 2010 comes into force and the day this Act receives Royal Assent.

   (5)  Subsection 30 (2) comes into force on the later of the day subsection 4 (1) of the Not-for-Profit Corporations Act, 2010 comes into force and the day subsection 30 (1) of this Act comes into force.

   (6)  Section 34 comes into force on the later of the day subsection 4 (1) of the Not-for-Profit Corporations Act, 2010comes into force and the day this Act receives Royal Assent.

Short title

   59.  The short title of this Act is the Ontario Electricity System Operator Act, 2012.

 

EXPLANATORY NOTE

The Bill amends the Electricity Act, 1998 by amalgamating the Independent Electricity System Operator (“IESO”) and the Ontario Power Authority (“OPA”) and by continuing them as the Ontario Electricity System Operator (“OESO”).  The board of directors of the OESO is required to ensure that there is an effective separation of functions and activities of the OESO relating to its market operations and its procurement and contract management activities. The OESO is prohibited from conducting itself in a manner that could unduly advantage or disadvantage any market participant or any party to a procurement contract or interfere with, reduce or impede a market participant’s non-discriminatory access to transmission systems or distribution systems.  The board of directors is also required to ensure that confidentiality is maintained.

In the re-enacted section 6 of the Act, the objects of the OESO are set out.  The OESO has the capacity, rights, powers and privileges of a natural person for the purpose of carrying out its objects, except as limited by the Act.  The OESO’s powers to borrow, invest its funds and to manage its financial assets, liabilities and risks are subject to such rules and restrictions as are prescribed.

The OESO is not an agent of the Crown and is composed of its board of directors.  The board of directors is composed of the OESO’s chief executive officer and between eight and 10 additional individuals appointed by the Minister of Energy.  The board of directors appoints the chief executive officer.

The re-enacted sections 11 and 12 deal respectively with the duties of the directors and conflicts of interest for directors and officers.  The OESO’s board may establish policies, rules, guidelines and codes, but a provision of a policy, rule, guideline or code is void if it conflicts with the Act, the regulations or the OESO’s by-laws.  Subject to certain specified limitations, the board of directors may delegate its powers to a committee of the board or may delegate powers to manage the business and affairs of the OESO to one or more directors or to one or more officers of the OESO.  Part XX of the Employment Standards Act, 2000, which deals with the liability of directors, does not apply to the directors of the OESO.

The board of directors of the OESO may make by-laws regulating the business and affairs of the OESO and, in particular, shall ensure that it maintains a by-law dealing with matters of corporate governance and structure.  The amendment or repeal of this by-law is subject to certain specified restrictions.

The Minister of Finance, as authorized by an order of the Lieutenant Governor in Council and subject to specified restrictions, may purchase the securities of or make loans to the OESO. 

At least 120 days before the beginning of each fiscal year, the OESO shall submit its proposed business plan for the fiscal year to the Minister for approval.  The OESO shall, at least 60 days before the beginning of each fiscal year, submit its proposed expenditure and revenue requirements for the fiscal year and the fees it proposes to charge during the fiscal year to the Ontario Energy Board for review, but shall not do so until after the Minister approves the OESO’s proposed business plan for the fiscal year.  The OESO shall not, without the approval of the Board, establish, eliminate or change any fees it has established or eliminate or change any fees established by a predecessor that remain in effect.  The purposes for which the OESO may establish and collect fees are set out in the re-enacted section 25.

The OESO’s board of directors is required to appoint one or more auditors to annually audit the OESO’s accounts and transactions.  Within 90 days after the end of each fiscal year, the OESO shall submit an annual report to the Minister, which report shall contain the OESO’s audited financial statements.  In addition, the Minister may require that the OESO submit other reports and information from time to time.  The OESO is also required to provide the Ontario Energy Board and the Market Surveillance Panel with such information as they may require from time to time.

The re-enacted sections 25.7 to 25.9 deal with transition matters resulting from the amalgamation of the IESO and the OPA and their continuation as the OESO.  The transition provision dealing with corporate matters, section 25.7, provides, among other things, that the IESO and the OPA cease to exist as entities separate from the OESO and all their rights, properties and assets become the rights, properties and assets of the OESO as do all outstanding debts, liabilities and obligations of the IESO and the OPA.  The members of the boards of directors of the IESO and the OPA cease to be members of their respective boards.  The by-laws of the IESO are continued as the by-laws of the OESO.  The OESO stands in the place of the IESO and the OPA with respect to any agreements, securities, approvals, permits and other instruments to which they were a party.  Similarly, the OESO is a party to each on-going proceeding to which the IESO or the OPA were a party at the time of the amalgamation.  Section 25.8 deals with employment matters — employees of the IESO and the OPA become employees of the OESO.  Transitional issues dealing with certain governance and other matters are dealt with in section 25.9.

The Bill also amends Part II.2 of the Act, in part to reflect the amalgamation of the IESO and the OPA and their continuation as the OESO.  References to the OPA and the IESO are changed to the OESO throughout the Part. There are also substantive changes made in this Part of the Act.  When so directed by the Minister or at the times specified in the regulations, the OESO is required to report back to the Minister on its assessment activities under section 25.29.  A new section dealing with energy plans is enacted.  The Minister may, in consultation with the OESO or any other person, develop and, with the approval of the Lieutenant Governor in Council, issue energy plans.  The Minister is empowered to direct the OESO to enter into or undertake certain procurement activities or contracts and to direct the OESO to assume the role of the Crown or an agency of the Crown in respect of certain procurement activities or contracts.

There are numerous amendments to the Act to reflect the amalgamation and the continuation of the OESO.  The regulation-making authority in section 114 is amended to reflect amendments in the Bill.  A new provision, subsection 114 (9), is added to permit the Lieutenant Governor in Council to make regulations governing transitional matters necessary or desirable to facilitate the amalgamation of the IESO and the OPA and the merging or segregation within the OESO of any duties, functions or activities of the IESO and the OPA.

Extensive changes are made to the Ontario Energy Board Act, 1998 to reflect the amalgamation of the IESO and the OPA and their continuation as the OESO and the changes in the role of the continued OESO made in the amendments to the Electricity Act, 1998.

Complementary amendments are made to several other Acts, including the Broader Public Sector Accountability Act, 2010, the Environmental Bill of Rights, 1993, the Lobbyists Registration Act, 1998, the Ministry of Energy Act, 2011, the Ontario Clean Energy Benefit Act, 2010 and the Provincial Parks and Conservation Reserves Act, 2006.

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