OEB Announces New Electricity Prices

TORONTO, Oct. 15 /CNW/ - Today the Ontario Energy Board (OEB) released electricity commodity prices that take effect November 1, 2009.

Regulated Price Plan (RPP) prices, reviewed semi-annually, are reflected on the "Electricity" line of residential consumer bills. The new RPP tiered prices will increase by 0.1 cent per kilowatt hour (kWh) to:

    
    -   5.8 cent per kWh up to 1,000 kWh each month; and
    -   6.7 cent per kWh above that.
    

Based on a residential consumer using 800 kWh per month, the impact of the increase in RPP tiered prices on the average electricity bill will be a reduction of about $1.00 per month. This is because, in the winter season (November 1 to April 30), consumers can use up to 1000 kWh per month at the lower price instead of the 600 kWh per month that applies during the summer season.

New RPP time-of-use prices are as follows:

    
    -   Off-peak price at 4.4 cents/kWh
    -   Mid-peak price at 8.0 cents/kWh
    -   On-peak price at 9.3 cents/kWh
    

Starting November 1, 2009, the time-of-use periods have changed to make time-of-use pricing more straightforward for consumers. As part of those changes, which were announced in May, 2009, the evening mid-peak period in winter has been eliminated and the shift from on-peak to off-peak prices will occur at 9:00 pm.

RPP prices are based on a 12-month forecast and are designed to provide stable and predictable electricity pricing as well as ensure the price consumers pay better reflects the price paid to electricity generators.

The Ontario Energy Board regulates the province's electricity and natural gas sectors in the public interest. It envisions a viable and efficient energy sector with informed consumers served by responsive regulatory processes that are effective, fair and transparent.

For more information, please refer to the attached backgrounder, visit the OEB website at www.oeb.gov.on.ca or contact the Consumer Relations Centre at the numbers below.

Ce document est aussi disponible en français.

    
    Backgrounder

    October 15, 2009
    -------------------------------------------------------------------------
    What is the     The Regulated Price Plan (RPP) is an electricity pricing
    RPP?            structure designed to ensure consumers pay what it costs
                    to supply their electricity while smoothing the price
                    variations that occur in the market. When the Ontario
                    Energy Board (OEB) sets prices, it adjusts for past
                    differences between what consumers paid and what it cost
                    to supply them, as well as reflecting a 12-month forecast
                    of future electricity costs. RPP prices are reviewed
                    twice a year and are adjusted as required (effective May
                    1 and November 1).

                    For consumers that are not on time-of-use pricing (see
                    below), the RPP has two prices. For residential
                    consumers, a lower price applies to the first 1,000 kWh
                    that is used in a month during the winter season. A
                    higher price applies to consumption above that threshold
                    (in the summer season from May 1 to October 31, the
                    monthly threshold is set at 600 kWh per month).

                    For non-residential consumers eligible for the RPP, the
                    monthly threshold remains at 750 kWh per month for the
                    entire year.

                    Consumers who currently buy their electricity from a
                    retailer are not affected by changes in RPP prices.


     Factors in     Primary factors contributing to the 0.1 cent per kWh
    Nov. 1, 2009    increase in the tiered RPP prices (and to the increase in
       Prices       the time-of-use prices) that will be effective as of
                    November 1, 2009 include:

                       1. New payments to OPG's Lambton / Nanticoke coal
                          plants which are related to the carbon dioxide
                          emission limits placed on the coal plants by the
                          government to improve air quality.
                       2. Lower Ontario electricity demand (which means that
                          certain fixed dollar amounts need to be recovered
                          across less consumption)
                       3. Lower surplus in the variance account means a
                          reduction in the credit included in RPP prices (to
                          clear the surplus in the variance account) (see
                          below).

                    Factors that have partially offset the impact of the
                    above (in other words, that have limited the price
                    increases that would otherwise have resulted from the
                    above factors) include:

                    -  Lower forecast market prices paid to certain
                       generators that are not paid regulated or contracted
                       prices;
                    -  Lower forecast natural gas prices, which reduces the
                       cost to operate gas-fired generation plants; and
                    -  Lower regulated payments paid for OPG's regulated
                       (nuclear and large hydroelectric) facilities beginning
                       January 1, 2010.


    Variance        The RPP variance account, managed by the OPA, tracks the
    Account         difference between what consumers have paid versus what
                    has been paid to generators. Since the last RPP price
                    adjustment in May 2009, the positive balance in the
                    variance account has decreased to $105M, down $32M from
                    $137M (in previous forecast). This reduces the credit
                    included in RPP prices, which translates to a price
                    increase.

    Provincial      Currently, the Provincial Benefit accounts primarily for
    Benefit         differences between the market price of electricity and
                    the prices paid to regulated and contracted generators.
                    If the market price of electricity is lower than those
                    regulated and contracted prices, the Provincial Benefit
                    will be a charge to consumers in order to pay for those
                    regulated and contracted prices. If the market price is
                    higher, the Provincial Benefit will be a credit to
                    consumers.

                    RPP prices include forecast amounts for the Provincial
                    Benefit. As such, consumers on the RPP do not see the
                    Provincial Benefit as a line item on their bills. By
                    contrast, consumers on retailer contracts have a separate
                    line item on their bills for the Provincial Benefit.


     Time-of-Use    In addition to the tiered prices described above, the
    (TOU) Prices    Board also sets RPP time-of-use prices. Time-of-use
                    prices only apply to a small subset of consumers at this
                    time. Only customers of Milton (all), Newmarket (all
                    residential), some Toronto Hydro, and some Powerstream
                    (starting Nov. 1) are expected to be billed on the basis
                    of the RPP time-of-use prices over the next six month
                    period.


    Typical         The OEB is now using 800kWh/month to represent the
    Consumer        typical consumption of an individual residential
                    electricity customer. The new figure more accurately
                    reflects typical monthly consumption than the previously
                    used 1,000 kWh/month.


    For more        Visit www.oeb.gov.on.ca.
    information
    

Ce document est aussi disponible en français.

SOURCE Ontario Energy Board

For further information: For further information: Media Inquiries: Ontario Energy Board, (416) 544-5171, Paul Crawford; Public Inquiries: (416) 314-2455 Or 1-877-632-2727


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890