We are pleased to announce that we are putting value back into the hands of our customers by eliminating all residential security deposits, returning existing deposits and reducing deposit requirements for businesses. For these business customers, deposits will be returned after one year of good payment history – a change from five to seven years depending on service type.
This will release more than $12 million back to families and businesses in the province.
To ensure all customers are treated equally, the Ontario Energy Board provided guidelines to all electricity distributors on how to apply security deposits across Ontario. Security deposits are collected to guarantee payment of future charges. Please take a moment to read this summary.
1. Requirements for Security Deposits
Security deposits will be collected when a business customer initially applies for service, or if a business customer has failed to maintain a good payment history.
The security deposit amount will be applied to the customer's account and will appear as a line item on the bill.
2. Security Deposit Review
Your security deposit will now be reviewed annually to determine whether it should be:
Fully refunded due to good payment history
Partially refunded due to a reduction in electricity use
Increased due to an increase in electricity use
Remain unchanged.
3. Calculation of Security Deposit Amount
We calculate security deposits as follows:
2.5 times your average monthly bill over the past 12 months for monthly billed customers.
1.75 times your average monthly bill over the past 12 months for bi-monthly billed customers.
If you have less than 12 months of service history with Hydro One, we will base the security deposit on a reasonable estimate.
Please note, if you have received two or more disconnection notices, we will calculate the amount of the security deposit based on 2.5 times your highest actual or estimated bill. This will apply whether your premises was disconnected or not.
4. The Importance of a Good Payment History
We encourage customers to maintain a good payment history to avoid being charged a security deposit. You are considered to have a good payment history as long as you have not had one of the following on record:
More than one disconnection notice issued.
More than one cheque or AutoPay returned for non-sufficient funds (NSF).
A collection or disconnection trip has occurred. In order for us to waive or refund a security deposit, business customers must show good payment history for a period of one year.
5. Criteria to waive or reduce a Security Deposit
Your security deposit amount may be waived or decreased if you provide the following:
Business customers with less than 50 kW demand:
A reference letter that confirms good payment history from another electric or natural gas utility in Canada where you were previously a customer. This letter must indicate that you had a good payment history for at least one year.
You may also provide a credit check at your expense that shows you are a good credit risk from Equifax, TransUnion or Dun and Bradstreet.
Business customers with demand of 50 kW and above:
A reference letter that confirms good payment history from another electric or natural gas utility in Canada where you were previously a customer. This letter must indicate that you had a good payment history for at least one year.
You may also provide, at your expense, an acceptable credit rating from Standard & Poor's, Moody's or Dominion Bond Rating Service, or an acceptable credit check from Equifax, TransUnion or Dun and Bradstreet.
6. Paying by Instalments
Business customers may pay a security deposit in equal instalments over a four-month period. If you would like to pay by instalment please contact us.
7. Acceptable Forms of Security
You may provide the security deposit by:
Exceptions/Special Circumstances
When a security deposit has been applied or increased due to a poor payment history, neither a satisfactory utility reference or credit check will be accepted. Only a good payment history will allow for a refund of the security deposit.
If you have not maintained a good payment history with Hydro One Networks we cannot accept another utility reference letter to waive or reduce your security deposit amount.
Utility reference letters are only valid for a one-year period.
8. Interest
Interest is payable monthly on security deposits and applied to the account. This will be paid to you starting on receipt of the total deposit. The interest rate used is the Bank of Canada's Prime Business Rate less 2%. Interest due will be paid monthly, or on return of the security deposit or closure of the account, whichever comes first. Interest will be paid by credit to your account.
