Energy Probe

Like a lot of homeowners, Bill Harang cringes when he opens his natural gas bill.

"It just shocks me when I look at the bottom line," says the Bowmanville, Ont., resident, who has watched his heating costs soar since he bought his three-bedroom townhouse in the late eighties.

So this year, he signed a contract with Canadian RiteRate Energy Corp., one of several natural gas marketers that allow consumers to lock in their price for three to five years.

RP-2002-0133    Exhibit L, Tab 9

Ontario Energy Board

IN THE MATTER OF section 36 of the Ontario Energy Board Act, 1998, S.O. c.15, Sched. B, as amended;

The Ontario government has admitted it failed to protect consumers by ordering a review of the agency responsible for overseeing the new, competitive electricity market, representatives of the opposition parties charged yesterday.

Premier Ernie Eves, reacting to increasing complaints about escalating electricity prices, last month ordered a full review of the mandate, procedures and staffing of the regulatory agency, the Ontario Energy Board.

Photo credit: Carlo Allegri
HOWARD HAMPTON: "An apology from Direct Energy would be nice."

Sales agents from Direct Energy Marketing Ltd., one of many firms aiming to capitalize on electricity deregulation in Ontario, are using quotes from Howard Hampton - one of deregulation's fiercest opponents -- to lure new customers.

Evidently looking to add some fizz to her fizzling campaign, Conservative Party leadership candidate Elizabeth Witmer this week promised "an immediate review" of Ontario's decision to deregulate the electricity market in May. Deregulation is a fuzzy concept that, thanks to California and Enron, has dubious connotations. Too bad the term in this case is a complete misnomer. In fact, regulation, and lots of it, is on the agenda.

(The information and forecasts contained here are current only as of the date of publication. Energy Probe in no way guarantees any decisions that might be made after consideration of any of the following statements. Our purpose is only to assist consumers with information that might be useful in considering options.)

Please also see Electricity 'deals' deceiving,

'Nothing will go wrong,' Harris vows as new firms allowed in.

Opening Ontario's electricity market to competition will not mean blackouts or price spikes, Premier Mike Harris vowed yesterday.

But Harris would not promise flat out that private hydro sellers will not increase the cost of electricity.

TORONTO - An Ontario group has come up with a Web site to help consumers consider the choices when the electricity market is deregulated next spring.

Faced with door-to-door sign up campaigns, advertising and a barrage of information, consumers must decide which supplier they want to go with.

The Ontario Clean Air Alliance created the Web site to clear up some of the confusion.

TORONTO - The price of natural gas is falling but some consumers have found themselves in a bind: they're still paying sky-high prices.

Most of these people locked themselves into a contract after last year's soaring energy prices.

Rose and Joe Balsamo decided to protect themselves early this year.

"The newspapers were full of stories...; horror stories, rates were going to increase," says Rose.

The Ontario Energy Board (OEB) uses the term "deregulation" in reference to electricity reform, for instance, on the FAQ portion of its web site. But there are many reasons why in its specific denotation, the term is inaccurate.

Never going to see any gas - rural residents   by Chris Morris/The Canadian Press

The retail price of natural gas has dropped 11 per cent this month, and is likely to drop another 20 per cent or more early this fall, says Enbridge Consumers Gas.

That's good news for gas users who decided not to sign long-term, fixed-price contracts last winter when gas prices soared to record levels.

Enbridge Consumers Gas has knocked off a surcharge of 3.9 cents a cubic metre as of July 1 - two months earlier than planned - because of falling prices.

Guiding and Controlling Ontario's Future Water and Wastewater Services:
User Pay and Full Cost Pricing,
Independent Economic Regulation, and
Strengthened Environmental Law Enforcement

By
Thomas Adams

Borealis Research Association

Submission to the Walkerton Inquiry
on behalf of Energy Probe Research Foundation

April 2001

Revised June 2001

Natural-gas marketers are descending on the greater Toronto area offering consumers fixed rates after a winter of soaring prices.

Homeowners who saw natural-gas prices increase more than 50 per cent in the past year have become the focus of advertising campaigns and reams of promotional material from gas companies that want to sign them to multiple-year contracts.

For Roger Pepler, the recent advertising is puzzling.

Want a hedge against rising natural gas prices? Don't sign that fixed-price contract, says the non-profit research group Energy Probe.

Energy Probe spokesman Tom Adams said yesterday consumers should be wary of long-term contracts like one offered by the newest natural gas player, Toronto Hydro Energy Services.

It's like trying to decide if a five- or three-year mortgage on your house is wiser than a one-year deal, he said. Energy suppliers like to have some insurance when they lock in long-term buying gas supplies.

"What impact is the rising price of natural gas having on the energy industry and on consumers? To get an outside perspective, Link recently talked to two industry experts, John Kinsey, portfolio manager and an oil and gas analyst, Caldwell Securities Ltd. and Tom Adams, executive director, Energy Probe."

The cost of heating your home is going up sharply because of a shortage of natural gas.

Instead of paying $175 in January, the average household will pay $225, says Ian MacLellan, vice-president of Energyshop.com, an Internet-based information and comparison service.

You will see an increase in your next bill even if you opted for equal monthly payments. Enbridge Consumers Gas is passing on the higher cost now rather than making a one- time adjustment at the end of the heating season.

The cost to heat a home in Ontario with natural gas will jump by an average of $55 a month -- and the increase could last from three to five years, an energy analyst says.

"That's going to be a big shock to a lot of people," said Ian MacLellan, the vice-president of marketing at energyshop.com, an independent information service for energy consumers, who added that about 500,000 consumers, including 250,000 in Toronto, will see the increase on their February bill.

"That's a big chunk."

Food banks across Canada are bracing for an increase in the number of people on fixed incomes looking for help as a result of the soaring price of heating fuel. Seniors, the disabled and people living on social assistance are among those expected to feel the brunt of a doubling in home heating bills over the last two years.

"We have heard some anecdotal stories from food bank users who have expressed concern about the increase in fuel costs," said Chris Slosser of Toronto's Daily Bread Food Bank.

Rising natural gas prices are pushing Eastern Ontario residents to add insulation, seal cracks and look to newer furnaces, spending money now to be energy misers later.

Since October, when it became clear that soaring gas prices weren't going to fade away, O'Reilly Brothers insulation contractors in Ottawa have seen their residential work orders jump by 30 to 40 per cent over the same period in other years.

Every day now, it seems there's another story about the soaring cost of natural gas.

Millions of Canadians who heat their homes with gas are facing a severe case of sticker shock this winter. Each bill seems to be 10, 20, even 50 per cent higher than the last one.

How big are the increases in natural gas? Try an extra $420 a year for the average customer of Enbridge Consumers Gas in Ontario. That's what Enbridge has told its 1,500,000 customers to expect.

Deregulation leaves millions of people with no way to know which firm offers the best power deal  

For Helen Nolan, the recent notice from her local electricity company was a puzzle.

An affiliate of Toronto Hydro was offering a contract to supply all the electricity she'd use for a year at what it called "a good fixed rate" of 5.65 cents a kilowatt-hour, or about the amount of power that would keep a 100-watt light bulb shining all night.

Home heating could cost $1,600

Natural gas prices are going through the roof this winter, creating increases of $500 or $600 in the annual bills for many typical households and a $25-billion hit to Canada's manufacturing industry.

For consumers in the Ottawa area, that translates into an expensive winter.

Home heating could cost $1,600

Natural gas prices are going through the roof this winter, creating increases of $500 or $600 in the annual bills for many typical households and a $25-billion hit to Canada's manufacturing industry.

For consumers in the Ottawa area, that translates into an expensive winter.

Minister Jim Wilson, M.P.P
Minister of Energy, Science and Technology
900 Bay St., 4th Fl
Toronto, Ontario
M7A 2E1

by fax: 327-6754 (five pages)

-->

Dear Mr. Minister:

The following remarks are in response to your letter of December 19, 1998 about the Ontario Energy Board's "Advisory Report to the Minister of Energy, Science and Technology on Legislative Change Requirements for Natural Gas Deregulation".

After filing Energy Probe's meter reading evidence in the Consumers Gas 1997 rates case before the Ontario Energy Board, Consumers Gas agreed, during the Alternative Dispute Resolution (ADR) process prior to the hearing, to reduce its 1997 meter reading budget by $500,000 or about 7%. This reduction in cost corresponds to an annual saving of about $0.38 per customer. The Board accepted the ADR agreement on this issue.

Pre-filed Testimony on Behalf of Energy Probe
Thomas Adams
Senior Consultant, Borealis Energy Research Association
Presented to the Ontario Energy Board Regarding

E.B.R.O. 492

IN THE MATTER OF the Ontario Energy Board Act R.S.O. 1990, c. O.13;

AND IN THE MATTER OF an Application by The Consumers' Gas Company Ltd. for an order or orders approving rates to be charged for the sale, distribution, transmission and storage of gas for its 1997 fiscal year.

Preamble

After 10 years of success with deregulation of gas, provincial regulators of gas local distribution companies (LDCs) should finish the job. The road forward is to fully deregulate that which can be competitive. Gas merchant functions still under the regulatory umbrella should be separated from rate regulation entirely. The invigorated competitive environment created by this change will benefit customers and the public interest.

Presenter: Thomas Adams
Director of Utility Research,
Energy Probe Senior Consultant,