Hydro HST Rebate: Are You Eligible?

In the recent throne speech, the Ontario Liberal government has promised that it will rebate the provincial portion of the HST from electricity bills, which will reduce residential bills by 8 per cent. It is estimated that this will provide savings of about $130 annually for the typical Ontario household. The rebate will come into effect on January 1, 2017.

While commenters have been debating the motivation behind the cuts and how much of a difference it will really make, it’s worth asking: what does this mean for residents of condominiums?

While many condominium owners have individual hydro meters, some buildings administer electricity under a common-element or bulk-meter system. This means that one meter measures electricity use for the entire building, and Hydro One then bills the condominium corporation for the collective electricity use. The total is then split among the residents, usually built into the owners’ common expenses according to the size of each unit.

But if the condo corporation is effectively the account holder, will the tax rebate be sent to the corporation? Will the residents ever benefit from this new rebate?

Unfortunately, details from the government are sketchy, so it is difficult to answer this. They have said the rebate would be eligible to residential customers as well as “Multi-unit residential buildings”, which could include condominiums. However, at the end of the day, if the corporation is the account holder, will the rebate still be received by the corporation? Unfortunately, we don’t yet have an answer to this question.

It may be helpful to compare the rebate to another program aimed at reducing the cost of electricity: the Ontario Electricity Support Program (OESP). This program provides monthly credits to low-income electricity consumers, but they need to be the account holder. Therefore, condominium residents who live in a building with a bulk-meter system are not eligible. However, where hydro is individually metered, the residents are eligible for the program.

One option for a corporation to consider is converting to suite-metering, using sub meters. This removes the cost of the hydro from the common expenses so that the owner is billed directly, potentially making them eligible for the rebate. However, there may be costs involved for the corporation in doing this. To read more about bulk-metering and suite metering, take a look at our previous blog post.

It remains to be seen how condominium corporations deal with this new rebate. Hopefully the provincial government will do the right thing and find a solution that means condominium owners can benefit like all other residents in the province. Stay tuned.

If you have any further questions about the tax rebate, contact our Condominium Law Group.