The Ontario Energy Board (the “OEB”) is of the view that it is entitled to intervene in corporate decision-making to ensure that a regulated utility operates in a manner that balances the interests of its shareholders against the interests of its ratepayers. The Ontario Court of Appeal recently endorsed this view.

At first blush, the decision of the Ontario Court of Appeal in Toronto Hydro-Electric System Limited v. Ontario Energy Board, 2010 ONCA 284 (“THESL v. OEB”), is contrary to the Supreme Court of Canada’s decision in ATCO Gas and Pipelines Ltd. v. Alberta Energy & Utilities Board (2006 SCC 4) (“ATCO”). In ATCO, the SCC considered the power of the Alberta Energy & Utility Board (the “AEUB”) to allocate the proceeds from the sale of non-utility assets to the utility’s rate-paying customers, instead of leaving the gain for the utility’s shareholders.

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