Union Gas Receives Ontario Energy Board Approval for 2018 Distribution Rates Effective January 1, 2018

FactslineUnion Gas recently received approval from the Ontario Energy Board (OEB) for a change in its distribution rates (also known as delivery rates) effective Jan. 1, 2018 (EB-2017-0087). These rates are set using the OEB-approved pricing formula which was set out in a five-year incentive regulation framework beginning in 2014.

The average delivery rate change for contract rate customers is shown below in cents/m3 and $/GJ. Individual bill impacts will vary and depend upon a customer's use of natural gas. The rate changes exclude cap-and-trade charges, which were filed as part of Union Gas’ 2018 Cap-and-Trade Compliance Plan in November last year.

Union Gas North Customers

 

Cents/m3

 

 

Rate class

2017 approved average
delivery rate
(cents/m3)
(1)(2)

2018 approved average
delivery rate
(cents/m3)
(2)(3)

 

Rate change (%)

 

 

Rate 20

2.2398

2.2424

0.1%

 

 

Rate 25

2.7201

2.7086

-0.4%

 

 

Rate 100

0.8392

0.8382

-0.1%

 

(1) EB-2017-0351 January 2018 QRAM

(2) Excludes Cap-and-Trade Customer-Related and Facility-Related Charges

(3) EB-2017-0087 2018 Rates

 

 

$/GJ

 

 

Rate class

2017 approved average
delivery rate
($/GJ)
(1)(2)(4)

2018 approved average
delivery rate
($/GJ)
(2)(3)(4)

 

Rate change (%)

 

 

Rate 20

0.5911

0.5918

0.1%

 

 

Rate 25

0.7179

0.7149

-0.4%

 

 

Rate 100

0.2215

0.2212

-0.1%

 

(1) EB-2017-0351 January 2018 QRAM

(2) Excludes Cap-and-Trade Customer-Related and Facility-Related Charges

(3) EB-2017-0087 2018 Rates

(4) Conversion to GJ based on 37.89GJs/10³m³


Union Gas South Customers

 

Cents/m3

 

 

Rate class

2017 approved average
delivery rate
(cents/m3)
(1)(2)

2018 approved average
delivery rate
(cents/m3)
(2)(3)

 

Rate change (%)

 

 

Rate M4

4.2862

4.8388

12.9%

 

 

Rate M5A

2.9246

3.0089

2.9%

 

 

Rate M7

3.9176

4.5152

15.3%

 

 

Rate M9

1.6764

1.7197

2.6%

 

 

Rate M10

6.7203

7.1728

6.7%

 

 

Rate T1

2.2686

2.4800

9.3%

 

 

Rate T2

1.1287

1.2924

14.5%

 

 

Rate T3

2.4755

2.5662

3.7%

 

(1) EB-2017-0351 January 2018 QRAM

(2) Excludes Cap-and-Trade Customer-Related and Facility-Related Charges

(3) EB-2017-0087 2018 Rates

 

 

$/GJ

 

 

Rate class

2017 approved average
delivery rate
($/GJ)
(1)(2)(4)

2018 approved average
delivery rate
($/GJ)
(2)(3)(4)

 

Rate change (%)

 

 

Rate M4

1.1004

1.2423

12.9%

 

 

Rate M5A

0.7509

0.7725

2.9%

 

 

Rate M7

1.0058

1.1592

15.3%

 

 

Rate M9

0.4304

0.4415

2.6%

 

 

Rate M10

1.7254

1.8415

6.7%

 

 

Rate T1

0.5824

0.6367

9.3%

 

 

Rate T2

0.2898

0.3318

14.5%

 

 

Rate T3

0.6356

0.6588

3.7%

 

(1) EB-2017-0351 January 2018 QRAM

(2) Excludes Cap-and-Trade Customer-Related and Facility-Related Charges

(3) EB-2017-0087 2018 Rates

(4) Conversion to GJs based on 38.95 GJ/10³m³

Reminder: Balancing Transactions are Interruptible

At this time of year, there is a greater likelihood that the daily scheduling of Daily Contract Quantity (DCQ) suspension and Ex-Franchise Transfer (EFT) transactions may be interrupted. If interruptions of balancing transactions are necessary, customers will be notified during the scheduling process and will need to submit a revised nomination.

Balancing transactions are subject to the rules outlined in the Priority of Service of Guideline. Two of the priority tiers apply specifically to Direct Purchase balancing transactions:

  • Balancing (Direct Purchase) > 500 GJ/day, and
  • Balancing (Direct Purchase) <= 500 GJ/day

If Union Gas interrupts transportation, storage withdrawals or storage injections, it could impact the scheduling of balancing transactions. For example:

  • When withdrawals are being interrupted, it means suspension and ex-franchise transfer transactions may be interrupted as well. Incremental supply transactions are still available to those that need them. Customers would need to be prepared to bring in their full DCQ and could bring in more if needed. Customers would also need to be prepared to reduce an EFT transaction.
  • When injections are being interrupted, it means incremental supply transactions may be interrupted as well. Suspension transactions are still available to those that need them. Customers would need to be prepared to reduce their incremental deliveries but could deliver less than their DCQ if needed.

Reminder for Union South Bundled Transportation (Direct Purchase) Customers: Review DP Status Reports

Union Gas issues monthly Direct Purchase (DP) Status Reports. These reports provide useful information for companies to be able to review and evaluate their energy consumption patterns and assess whether or not adjustments to commodity purchases should be considered. The report reflecting actual information to the end of December has been issued.

This winter has had periods of significantly colder than normal weather. Customers are encouraged to review their DP Status Reports each month and to consider whether or not they should bring in any gas needed to meet their winter checkpoint or expiry balancing.

DP Status Reports issued in early February will include a forecast of the expected weather impact. In the meantime, a forecast of weather is provided in Unionline (Reports>Weather Impact). This report shows how much colder (or warmer) weather is forecast to be for each month of the winter and is refreshed on Monday of each week.

Customers are encouraged to discuss purchase options with their energy marketers.

Union Gas files an application for the Kingsville Transmission Reinforcement Project

The week of Jan. 22, 2018, Union Gas is filing an application to the Ontario Energy Board (OEB) for the Kingsville Transmission Reinforcement Project (EB-2018-0013). This project has a targeted in-service date of Nov. 1, 2019, but will be dependent upon approval from the OEB.

The Project is in response to increasing natural gas demand for firm service on Union Gas’ Panhandle Pipeline System. Additional growth is forecasted in the area which cannot be accommodated by the existing natural gas system. This pipeline project would relieve constraints on the system and support market growth along the entire Panhandle System, addressing expressed market concerns regarding availability of firm natural gas services.

If approved, this project will have the following overall rate impacts.

Estimated rate impacts of the proposed Kingsville Transmission Reinforcement Project 

Rate Class

Estimated Delivery Charge Impact*

 

Estimated Total Bill Impact**

Rate M1/M2

0-2%

0-1%

Rate M4

4-5%

0-2%

Rate M5

(0-1%)

(0-1%)

Rate M7

6-8%

0-3%

Rate M9

4-5%

0-1%

Rate M10

9-10%

3-4%

Rate T1

2-4%

0-1%

Rate T2

4-5%

0-1%

Rate T3

5-6%

0-1%

*2021 represents the largest Project-related net revenue requirement from 2019-2028
**Excludes customer-related cap-and-trade charges. Based on Union Gas’ Jan 2018 rates

Natural Gas delivers low cost, reliable energy to the province. Updates will be provided once a decision has been reached by the OEB.

If you have any questions about this edition of Factsline, please contact Patrick Boyer.

Patrick Boyer (519) 436-5470   Cell (519) 436-4915   Email: pboyer@uniongas.com