Ontario municipalities prepare for changes to pricing

TORONTO, ONTARIO - In April 2008, municipalities will no longer be eligible to purchase electricity under the Ontario Energy Board's Regulated Price Plan (RPP) and will instead be expected to pay the 'full cost of power'. As a result, municipalities such as the District Municipality of Muskoka have implemented pro-active solutions including signing contracts with Direct Energy for fixed rate plans to manage their electricity costs.

The RPP sets the price Ontario consumers and municipalities pay per kilowatt hour for the electricity they use each month. To help control these costs, municipalities can look to fixed rate contracts to help manage the volatility in the energy market.

The attraction of fixed rate contracts is further underlined by many commentators' forecasts of rising electricity prices in Ontario.

Independent industry analysts have predicted that by 2015 electricity prices in the province will need to be 60 to 70% higher than they are now - or roughly 6.5% per year - to pay for new generation, infrastructure and conservation programs.

"There are countless considerations when managing a municipal budget, accounting for volatility in the energy market further complicates the process," said Maura Clark, President, Commercial and Industrial Energy, Direct Energy. "A fixed-rate plan allows municipalities, such as Muskoka, to contribute to the long-term sustainability of the community without having to worry about the impact of continually changing energy prices."

Direct Energy will provide the District Municipality of Muskoka with electricity for five years. Ten percent of Muskoka's electricity will come from low-impact, Eco-Logo certified hydro facilities located in the region. Muskoka's use of green power is expected to save approximately 300 tonnes of carbon, which is the equivalent of planting 66 thousand acres of trees.

"This contract is the first step in a comprehensive energy plan, a portion of which supports our efforts to reduce Muskoka's impact on the environment," said Stephen Cairns, Finance Commissioner of the District Municipality of Muskoka.

"Not only will the fixed rate plan help us with long term budgeting, as we come off the RPP, but with Direct Energy's Enterprise Central, we'll be able to learn more about our consumption pattern. This knowledge will enable us to better manage our energy usage and become a more environmentally responsible community."

Three additional municipalities in the Muskoka area - The Township of Georgian Bay, The Township of Muskoka Lakes and The Township of the Lake of Bays - have entered into five-year electricity programs with Direct Energy, which include a portion of Ecologo certified green power.

Related News

solar panels

Saskatchewan to credit solar panel owners, but not as much as old program did

REGINA - Saskatchewan has unveiled a new program that credits electricity customers for generating their own solar power, but it won’t pay as much as an older program did or reimburse them with rebates for their costs to buy and install equipment.

The new net metering program takes effect Nov. 1, and customers will be able to use solar to offset their own power use at the retail rate.

But they will only get 7.5 cents per kilowatt hour credit on their bills for excess energy they put back into the grid, rather than the 14 cents in the previous program.

Dustin Duncan,…

READ MORE
hydro one chart

Research shows that Ontario electricity customers want more choice and flexibility

READ MORE

rise-of-data-centers-in-alberta

The Rise of Data Centers in Alberta

READ MORE

pc ches crosbie

It's CHEAP but not necessarily easy: Crosbie introduces PCs' Newfoundland electricity rate reduction strategy

READ MORE

Overturning statewide vote, Maine court energizes Hydro-Quebec's bid to export power

READ MORE