The $113 bill "for nothing" in Ontario

I've seen many references to a $113 hydro bill "for nothing" today. With anger high over electricity costs in the province, this seems to be a rallying point for some.

Not for me.



Before I get to the specific bill...

I saw tweets from the official opposition this morning showing the bill, and tonight Christina Blizzard has a report on events that followed; Sousa claims hydro bills going down.

To me, Sousa is an appalling man, but that's not exactly what he's shown as saying. This is:

“In 2013, in our long-term energy plan, the average projected payment was about $167 on a monthly bill. What the opposition fails to acknowledge is that prices are, in fact, coming down well below those very projections”

They did show that in the 2013 Long-Term Energy Plan (LTEP), and they were quite specific about what it was they were showing; "Monthly Residential Bill, Includes taxes in Nominal $ assuming 800 kWh." There's even a supporting LTEP 2014 spreadsheet that breaks down the $167 monthly charge (in nominal dollars assuming 800 kWh per month), and part of that $167 is the ridiculous Debt Retirement Charge - which Sousa was kind enough to remove from residential consumers even though he is still screwing businesses with the charge.

On 800 kWh that is $5.6o Sousa himself has knocked off of $167.

So how, as Sousa says, "well below those expectation", are bills now?

The prices are different among the many dozen of local distribution companies, and consumer classes, but the Ontario Energy Board has a great tool to estimate rates by selecting these parameters. The latest rate hikes aren't in the tool yet, but for fun I chose small town "Toronto Hydro-Electric System Limited",  punched in the 800 kWh monthly usage, and left the other defaults. The total is $165.93, but with the May 1st rate hike it's going to about $169.



I don't want to get into a partisan battle, but I'd ask Ontario Liberals to consider the possibility $169 is not, as Sousa claims, "well below" 167. I could argue that it is, citing the works of famous educators such as "The Count" but, bwah hah hah, please just consider the possibility $169 is actually greater than $167.

For those more comfortable with advanced mathematics, understand this means the $5.60 cut in ending the Debt Retirement Charge has been more than offset by increases elsewhere.

Some of the offset is in the price of the electricity commodity - the LTEP 2013 spreadsheet indicates an average of 10.9 cents per kilowatt-hour, and the May 1st rate increase will push it to 11.1 cents/kWh.

___

Now, to the $113 bill "for nothing." If you look carefully at that bill you'll see the "service type" is "Residential Seasonal", and the bill is for 3 months. This bill seems to be not for a primary home, but for what those really struggling with electricity bills might call an extra house.

Regardless, this is paying for a service, and the regulator is allowing all providers to move to charging for the service by the service - and not through a rate per unit actually consumed. Already a portion of all charges is fixed, and this is not true simply for electricity . If I used no natural gas for 3 months, I'd pay about $65.

Big whoop.

It costs a certain amount to have the service available and that's what the charge is for, and it's what the charge should be for.

___

Finally, Sousa pointed out:

"When it comes to pricing, [PC leader Patrick Brown] has just reinforced the necessity for us to make these enhancements and these improvements to Hydro One, which is exactly what we’ve done."

What a member.

Hydro One has little to do with rate hikes thus far this year - although they, along with other distribution companies, will get to hike rates soon in order to make up for the unexpected shortfall of a low-demand winter. Thus the direction moving away from volumetric rates. Sousa is simply making like his Hydro One sale is something other than a financial scam by connecting it to an issue he doesn't care enough to know about.

What a tool.