Electricity Regulation FAQs

The Prince Edward Island Regulatory and Appeals Commission regulates public utilities, including Maritime Electric. The Commission’s role with Maritime Electric is to ensure that ratepayers receive safe and reliable service, and that the rates for electric service are reasonable, publicly justifiable and non-discriminatory.

In addition to approving the rates for electric service, the Commission makes decisions on a number of applications that may impact the level of service that customers receive, or the rates that Maritime Electric may charge for those services. These applications may relate to proposed capital expenditures, Maritime Electric’s allowed return on investment, or changes to Maritime Electric’s rate structure.

When the Commission receives an application from Maritime Electric, a notice of application is posted on the Commission’s website and published in local newspapers. This ensures that the public is aware of current applications and has the opportunity to participate in the regulatory process.

The Prince Edward Island Regulatory and Appeals Commission sets the rates that Maritime Electric can charge its customers.

The Commission’s role is to ensure that Maritime Electric’s customers receive safe and reliable service, and that the rates for electric service are reasonable, publicly justifiable and non-discriminatory.

In setting electric rates, the Commission must balance the interests of Maritime Electric and the interests of its customers. This means that the rates for electric service must be fair to customers on the one hand, and also allow Maritime Electric the opportunity to earn a fair return on its investment.

Typically, Maritime Electric determines when a change in electric rates is necessary. Maritime Electric then files a General Rate Application with the Commission, requesting a change in the electric rates and explaining why the change in rates is required.

In recent years, Maritime Electric has filed General Rate Applications seeking approval for rates for more than one year. This is called multi-year rate setting. In multi-year rate setting, electric rates are set for a period of two or three years. This benefits customers by ensuring that electric rates remain stable and predictable.

The Commission must consider many factors in setting electric rates. As part of its General Rate Application, Maritime Electric files its forecast annual revenue requirement. The annual revenue requirement is the amount required for Maritime Electric to recover its forecast annual costs of providing electric service, and to earn a fair rate of return.

The annual revenue requirement is determined by looking at a number of forecasts, including Maritime Electric’s forecast energy sales for the year, the forecast cost of generating or purchasing the energy, and the forecast cost of delivering that energy to customers.

The Commission must analyze each element of the revenue requirement and determine whether Maritime Electric’s forecasts are reasonable. This is called cost of service regulation as the electric rates are intended to allow Maritime Electric to recover its cost of providing service to customers, plus a reasonable rate of return.

Once the revenue requirement is determined, the costs are allocated between Maritime Electric’s different classes of customers (i.e. residential, general service, large industrial and small industrial). The rates charged to a particular rate class reflect the cost of providing service to that class of customers.

The Commission invites public input and involvement throughout the rate setting process. When a General Rate Application is filed, a notice of application is posted on the Commission website and published in local newspapers. The public has the opportunity to submit questions to Maritime Electric, make comments to the Commission, and actively participate in the public hearing as an intervener.

Each year, Maritime Electric is required to submit its annual capital budget to the Commission for review and approval. The capital budget includes any proposed expenditures for capital improvements or additions that are anticipated for the next year.

Typically, Maritime Electric categorizes the proposed expenditures as relating to generation, distribution, transmission, or corporate expenditures. A capital expenditure may be incurred in a single year, or it may be a recurring annual expenditure as part of an ongoing capital program.

Once Maritime Electric files its annual capital budget, a notice of application is posted to the Commission website and published in local newspapers. Interested members of the public have the opportunity to submit questions to Maritime Electric and to submit written comments to the Commission.

The Commission routinely issues interrogatories to Maritime Electric to gather additional information necessary for the Commission to make an informed decision on the capital budget. This information is also shared publicly on the Commission website.

Following its review of the evidence, the Commission issues a written decision and order. The Commission has the authority to approve all or part of Maritime Electric’s annual capital budget.  

Sometimes unforeseen capital expenditures arise after Maritime Electric’s annual capital budget has been approved. In that case, Maritime Electric files a supplemental budget request with the Commission seeking approval for the unforeseen capital expenditure.

An energy efficiency and demand-side management plan incorporates activities, techniques and programs that are intended to reduce electricity consumption or modify when electricity is consumed.

A public utility that intends to implement an energy efficiency and demand side management plan must first submit the plan to the Commission for review. The Commission may approve the plan if it is satisfied that:

• The plan is reasonably likely to achieve the forecast results.
• The plan contains a reasonable estimate of the financial costs and benefits for the public utility and its customers.
• There is a plan to apportion the financial costs and benefits between the public utility and its customers.

The PEI Energy Corp submitted a new three-year Energy Efficiency and Conservation plan to the Commission in December 2021. The plan is for the 2022-23 and 2024-25 fiscal years. The Commission issued an Order approving this plan on April 23, 2024. The plan is effective March 1, 2023, and will be in place until February 28, 2026.

Net-metering is a way of allowing electric customers the opportunity to self-supply all or part of their annual electrical load from a customer-owned renewable energy generation system.

The Commission generally does not regulate net-metering agreements. Instead, the process, conditions, and rates that apply to a net-metering agreement are set out in the Renewable Energy Act and Regulations.

If you are considering a renewable energy generation system, you should consult the Renewable Energy Act and Regulations for more information.

If you own a renewable energy generator and a public utility (such as Maritime Electric) has:

• refused to enter into a net-metering agreement with you, or
• terminated your net-metering agreement

then you are able to appeal the decision to the Commission.

Maritime Electric does not provide electric service in the City of Summerside. Instead, electric power is provided by the City of Summerside Electric Utility.

Summerside Electric is generally exempt from regulation by the Commission. The Commission does not, for example, approve Summerside Electric’s annual capital budget, its operating expenses, or the electric rates charged to Summerside’s customers.

However, the Commission does have jurisdiction over certain matters that may impact Summerside Electric. For example, if Summerside Electric wants to provide new electric service outside of its municipal boundaries, it would need to apply to the Commission for a permit.

In other instances, decisions made by the Commission may impact Summerside Electric. The Commission, for example, is required to review and approve Maritime Electric’s Open Access Transmission Tariff (“OATT”). The OATT rates approved by the Commission are then charged to Maritime Electric’s transmission customers, including Summerside Electric.

The Lieutenant Governor in Council determines the annual assessment paid by Summerside Electric to the Commission. The Electric Power Act states that the annual assessment paid by Summerside Electric shall not exceed $20,000.00.

Sometimes disagreements arise between Maritime Electric and its customers. The disagreement may relate to issues such as a monthly bill, the disconnection of electric service, or the cost of extending service to a new home or building.

In many cases, the disagreement can be resolved by reviewing Maritime Electric’s General Rules and Regulations. The General Rules and Regulations are approved by the Commission, and set out the terms and conditions of service, as well as the rates that Maritime Electric can charge for electric service and other services it provides.

The following process should be followed in the event of a disagreement between a customer and Maritime Electric:

Step 1:  The customer should bring the disagreement to the attention of Maritime Electric. The customer and Maritime Electric may be able to work together to resolve the issue.

Step 2: If Maritime Electric and the customer are not able to resolve the issue, then either one may refer the matter to the Commission.

Step 3:  Commission staff will work with the customer and Maritime Electric in an effort to resolve the issue. If the matter cannot be resolved, then the customer can make a formal complaint to the Commission.

Step 4:  Once a formal complaint is made, the Commission will gather all necessary information from the customer and Maritime Electric. Once the Commission has all the information it needs, it will make a decision and will notify both Maritime Electric and the customer.