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2014 Sustainability-based Annual Report

27 Low and Balanced Customer Rates — Horizon Utilities Horizon is proud to be a sector At Horizon, the same customer leader on customer rates. When paid closer to the lower end at setting out to establish rates for our $2,579 (Figure 3). customers, we strive both to maintain Similarly, a typical large commercial low rates and to ensure that our rates customer, such as an industrial user among different classes of customers requiring 3,500 kilowatts of capacity, reflect the specific costs for serving each class of customers. While Ontarians may know that electricity rates are set by the Ontario Energy Board, most would be surprised to learn that rates vary widely from one local distribution company to another. For a typical residential customer using 800 kilowatt-hours of consumption per month, the distribution and transmission charges vary widely by utility. In 2014, most were in the $30 to $50 range, with a few exceptions. Horizon is near the middle of the pack at $37. The relatively wide range is due both to cost management and, within the constraints of rate regulation, some flexibility in the manner in which distributors allocate their costs to different rate classes (Figure 1). On the latter point, the phenomenon is seen more clearly for the case of a typical small commercial customer, such as a large corner store consuming 13,000 kilowatt-hours per month. The majority of utilities across Ontario charged between $275 and $450 for distribution and transmission in 2014. At Horizon, the customer paid $289, among the lowest in Ontario (Figure 2). For a light manufacturing-sized commercial customer, such as a warehouse small manufacturer or even a municipal arena, where a typical customer might use 350 kilowatts of demand, the majority of local distribution companies charge between $2,500 and $4,000 (with some outliers at both ends). would see rates varying from $20,000 to $35,000 per month for the distribution and transmission charges, but just $23,061 for Horizon customers (Figure 4). Figure 2 Small Commercial using 13,000 kWh per month Horizon Utilities $289 $500 $450 $400 $350 $300 $250 $200 $150 All LDCs lowest to highest cost Figure 4 General Service >50 kW using 3,500 kW per month Horizon Utilities $23,061 $45,000 $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 All LDCs lowest to highest cost Horizon Utilities $37 $60 $50 $40 $30 $20 Figure 3 General Service >50 kW using 350 kW per month Horizon Utilities $2,579 $4,500 $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 All LDCs lowest to highest cost Lorem Ipsum Dalar Nam tes et et es num XX Figure 1 Residential using 800 kWh per month All LDCs lowest to highest cost Distribution and Transmission portion of the bill only. Source: 2014 OEB Tariff of Rates and Charges. NB: These four graphs represent typical customers – one residential and three commercial of varying size. Data excludes Hydro One Networks because of the character of its service territory compared to other LDCs.


2014 Sustainability-based Annual Report
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