On Wednesday, August 28, 2019, the National Energy Board (NEB) became the Canada Energy Regulator (CER). For further information please visit our Implementing the Canadian Energy Regulator Act information page

Ontario

 

Figure 9: Sample monthly residential gas bill – based on 7.37 GJ of consumption

Source: Ontario Energy Board

Description:

Two stacked area graphs show the breakdown of residential natural gas bills from October 2013 to January 2018. The sample bills are for 7.37 GJ of consumption per month in the province of Ontario. The graph shows the amount spent on four bill components: the carbon price charge, the commodity price, variable charges, and fixed charges. One graph shows a sample of monthly bills for a customer receiving service from Enbridge Gas Distribution. The second graph shows a sample of monthly bills charges for a customer receiving service from Union Gas Limited.

For the Enbridge Gas Distribution bill:

The commodity price component has fluctuated, but decreased from $22.68 per month in October 2013, to $21.08 per month in January 2018.

The carbon price charge component was $6.63 per month from January 2017 to January 2018.

Variable charges increased from $24.12 per month from October 2013 to $33.73 per month in January 2018.

Fixed charges remained constant at $20.00 per month from October 2013 to January 2018.

For the Union Gas Limited bill:

The commodity price component has fluctuated, but increased from $24.33 per month on October 2013, to $31.50 per month on January 2018.

The carbon price charge component was $7.04 per month from January 2017 to January 2018.

Variable charges increased from $8.71 per month from October 2013 to $11.41 per month in January 2018.

Fixed charges remained constant at $21.00 per month from October 2013 to January 2018.

Natural gas providers

The two main gas providers in Ontario are Enbridge Gas Distribution and Union Gas Limited. Enbridge holds the franchise for the Greater Toronto Area, the Niagara region, and areas in eastern Ontario including Ottawa. Union Gas serves most other urban regions. EPCOR Natural Gas also provides natural gas in Ontario, as do a number of gas marketers. Natural gas providers in Ontario are regulated by the Ontario Energy Board (OEB).

Commodity price

The ‘effective price’ is the commodity price of gas on Ontario bills. This regulated rate is forecasted quarterly, and approved by the Ontario Energy Board (OEB). The effective price includes a ‘gas cost adjustment.’ This adjustment is based on an amount of money owed or credited because of the difference between the estimated and actual price, for the previous billing period.

For Enbridge customers, the commodity price component has decreased from $22.68 per month ($3.0 per GJ) in October 2013, to $21.08 per month ($2.86 per GJ) in January 2018. For Union customers, the commodity price has increased from $24.33 per month ($3.30 per GJ) on October 2013, to $31.50 per month ($4.27 per GJ) on January 2018.

Carbon price

Effective July 3, 2018, Ontario has revoked its cap-and-trade regulation, prohibiting all trading of emission allowances. This will lead to changes to the cap-and-trade related charges on Ontario natural gas bills. The cap-and-trade related charges in Ontario were comprised of two parts, the ‘cap-and-trade customer related charge’ and the ‘cap-and-trade facility related charge’. The money collected from these charges was used to pay for carbon allowances. These allowances were part of the Ontario’s participation in the Western Climate Initiative cap-and-trade system. These charges started appearing on bills at the beginning of 2017. The carbon price is different for Enbridge and Union customer because part of the charge is facility related, meaning it is based on emissions from each company’s facilities. Different facilities may have different levels of emissions, so the charge is different. For Enbridge customers the carbon price bill component was $6.63 per month ($0.90 per GJ) from January 2017 to January 2018. For Union customers, the carbon price bill component was $7.04 per month ($0.96 per GJ) from January 2017 to January 2018.

Variable charges

The variable component of Ontario bills is comprised of transportation, delivery, and storage charges. Each of these charges collects revenue to pay for different costs. The transportation charge is for moving gas from markets to the distribution system. The delivery charge is for delivering gas to individual homes. For this charge, the marginal rate decreases the more a customer consumes. This means that when a customer uses more gas, they pay more, but their average delivery charge goes down. The delivery charges shown in the graph are based on the Canadian average consumption. The last component of the variable charge is a storage charge. This is for storing gas in warmer months for later use in colder months.

For Enbridge customers, variable charges increased from $24.12 per month ($3.27 per GJ) from October 2013 to $33.73 per month ($4.58 per GJ) in January 2018. For Union customers, variable charges increased from $8.71 per month ($1.18 per GJ) from October 2013 to $11.41 per month ($1.55 per GJ) in January 2018.

Fixed charges

The ‘monthly customer charge’ is a fixed, per month charge. The money collected from this charge pays for pipeline systems costs, and the costs of administering a customer’s account.

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