Monday, January 31, 2011

OEB Consultation on Time Of Use Rates

Not to steal any thunder from the massive storm surrounding UBB, but I thought you should all be aware of the other pending Ontario rip-off. The Ontario Energy Board has undertaken a consultation process to determine if changes need to be made to the time-of-use rate structure for electricity so that some of the Board's and the Government's goals can actually be accomplished. They started by having some consultant write a report about it, then asked for comments. BOY, did they get comments! Here are the highlights:

Advocacy Centre for Tenants Ontario: The Board should not proceed with the roll-out of TOU pricing to low-income customers before a comprehensive examination of this vulnerable sector’s energy use characteristics and the most effective ways to reduce their energy use without putting these individuals in financial or physical risk

Consumers Council of Canada: Moving all of the solar and wind costs, for example, to peak is not consistent with how those resources are run. The Council is concerned that arbitrarily increasing the peak price would unfairly increase the cost burden for those that cannot shift their load.

Direct Energy: To successfully implement time of use pricing and achieve targeted demand reduction goals, Ontario must first, integrate all generation costs into the wholesale price, and then, match the time of use cost with individual consumer loads....Without such a reform, time of use rate setting will not be able to fairly allocate the costs of peaking generation to peaking consumption; exacerbating existing consumer inequities and making the Board’s mission to guarantee just and reasonable rates impossible to accomplish.

Just Energy: mid-peak and peak periods are too close in price

London Property Management Association: The Board has no comprehensive, long-term, province-wide data upon which it can evaluate the impact of the current TOU pricing structure.

Ontario Non Profit Housing Assoc:The report did not specifically examine or report on the potential impact of TOU pricing on low-income households in any of its case studies.

Pollution Probe: While Ontario’s peak demand occurs on hot summer afternoons on a province-wide basis, it is important to remember that northern Ontario actually experiences its peak electricity demand during the winter instead

Ontario Power Workers Union: The policy decision that embarked Ontario on the smart metering and TOU pricing path was made in the absence of any robust research on the costs and benefits of this undertaking.....the increase in intermittent renewable supply that requires fossil-fuelled generation back-up for system reliability...has narrowed the RPP TOU price ratio and the increase in intermittent renewable supply contemplated in Ontario’s Long Term Energy Plan will exacerbate the problem by further reducing this differential.

School Energy Coalition: the Report proposes that certain costs be assumed to arise only in the summer (wind and solar), when it is clear that is not actually the case

Vulernable Energy Consumers Coalition: since consumers typically need to make investments in either equipment or lifestyle changes in order to affect load shifting, if the TOU differentials overstate the benefits then the cost of the investments made to achieve load shifting are likely to exceed the associated benefits, resulting in a loss in economic efficiency.

Mr Honey:...nearly half of my annual consumption is for heat

Mr Reynolds: Delivery, regulatory, and debt retirement charges on Ontario electricity bills are based on cumulative consumption during the billing period, and are therefore are not affected by customer efforts in shifting demand.....This means that residential customers are able to impact less than one-half of their electricity bills by leveraging TOU rates.

Mr Weir: TOU pricing will not reduce electricity use and this is evidenced by the Brattle Group stating there is no pricing that will benefit anything unless more studies/pilots are completed. We are now entering the 7th year of "Smart Meter/TOU" roll-out without a definitive answer.

All the respondents brought up great points that I think have left the OEB scratching it's collective head because it's just another example as to how messed up things really are.