FAQs

Before a natural gas utility can provide gas service within a municipality, it must enter into a franchise agreement with that municipality. A franchise agreement is an operational contract between a municipality and a gas utility that sets out the rights and obligations of both parties. All franchise agreements must be approved by the OEB.

The OEB adopted the Model Franchise Agreement to ensure fairness, transparency and consistency among individual franchise agreements across Ontario. The OEB expects that gas utilities and municipalities will use the terms of the Model Franchise Agreement without amendment, unless there is a compelling reason for deviation.

In recent years, several municipalities and local community-based interest groups in Ontario have challenged certain terms of the Model Franchise Agreement during individual gas franchise proceedings. Many of these challenges raised issues of a generic nature, focusing on certain sections of the Model Franchise Agreement itself, rather than unique municipality-specific circumstances.

In response, the OEB is initiating this proceeding to examine certain sections and components of the Model Franchise Agreement that have emerged as issues of concern. This proceeding will review the templated form of the Model Franchise Agreement; it will not entail a review of individual franchise agreements that have been signed by specific municipalities and gas utilities.

This proceeding takes place within the context of Ontario’s current energy landscape and the objectives outlined in Ontario’s Natural Gas Policy Statement, which establishes that natural gas remains a vital component of Ontario’s energy mix.