Excellent Analysis of Ontario Legislation to Merge IESO/OPA

Robert Warren, a leading Canadian administrative law litigator, of the firm Weir Foulds, has penned a trenchant critique of Bill 75, the Act that would merge and downgrade the independence of the Independent Electricity System Operator (IESO) and the Ontario Power Authority (OPA).

My one quibble with Warren’s excellent analysis is to challenge his view that the OPA was supposed to be independent when it was first created.

The original Electricity Restructuring Act from 2004 stipulated that the directors of the OPA served “for pleasure”, meaning that they could be fired on ministerial whim. This contrasts with the original legislative design of the predecessor of the IESO, the Independent Electricity Market Operator, whose directors served “for cause”, meaning that they had to take an action damaging to the agency’s objects to be fired. I have previously argued that long, strong tenure for Ontario energy regulators would promote the public interest.

Another indication of the OPA’s subservience to the government’s will is that from its beginning, the OPA was legally required to follow government policy in lots of areas, such as conservation.

The government’s original appointments to the OPA Board started out with folks like Lynn McLeod (former Ontario Liberal Party president), Bruce Lourie (green energy policy entrepreneur), and John Beck (CEO of the large electricity contractor AECON, key partner in OPG’s $2.6 billion Mattagami redevelopment) — again, indicators of non-independence.

The OPA’s lack of independence was my key concern when I testified before the legislature committee considering the legislation to create the OPA in 2004. I concluded that testimony by arguing that the creation of the OPA “will fail to provide a stable structure for Ontario’s power system going forward, and the passage of Bill 100 will necessitate a further comprehensive electricity restructuring in the near future.”