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
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
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.
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Backgrounder
October 15, 2009
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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
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For further information: Media Inquiries: Ontario Energy Board, (416) 544-5171, Paul Crawford; Public Inquiries: (416) 314-2455 Or 1-877-632-2727
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