Terasen Gas receives approval for changes to natural gas and propane rates
| December 12, 2008 |  Follow us on Twitter |
SURREY, B.C. – Terasen Gas has received approval from the B.C. Utilities Commission (BCUC) to change some of the rates it charges customers for natural gas and propane. These changes will take effect January 1, 2009.
A typical residential customer in the Lower Mainland, Fraser Valley, Interior, North and the Kootenay service areas will see their total annual gas bill decrease by less than one per cent, approximately $5 to $8 per year for customers consuming between approximately 75 gigajoules (GJ) to 95 GJ per year.
Customers in these regions will see a decrease of $0.31 to $0.33 per GJ in midstream charges, which covers fees that Terasen Gas pays other companies to store and transport the gas delivered to customers. The commodity rate of natural gas remains unchanged, following a 15 per cent decrease in October. The BCUC also approved an increase in delivery charges, equal to about a two per cent increase on a customer’s annual bill.
“We are very pleased that market conditions have allowed us to maintain our current natural gas commodity rates, which make up about two-thirds of a customer’s bill,” said Cynthia Des Brisay, Terasen Gas Vice President, Gas Supply and Transmission. “These costs are passed on to customers without mark up, and we use several tactics and strategies to ensure a reliable supply of gas at a reasonable price for customers. These strategies include purchasing gas from a variety of sources, locking in the price of gas through the use of different contract terms, and purchasing a portion of the supply from the spot market.”
The changes to delivery and midstream rates will also apply to those customers currently participating in the Customer Choice program.
Vancouver Island, the Sunshine Coast, and Powell River are covered by a separate regulatory agreement that includes a rate structure different from the one that applies to other B.C. communities served by Terasen Gas. Current residential rates will remain unchanged in those areas.
Fort Nelson customers will see about a four per cent increase in their total annual bill, reflecting both a decrease in their commodity price of gas and an increase in delivery rates. This works out to an overall increase of approximately $51 per year for a residential customer consuming 140 GJ per year.
Revelstoke customers receiving piped propane will see a substantial decrease on their total annual bills. This includes a commodity rate reduction of approximately 29 per cent, in addition to an increase of approximately one per cent in delivery charges. This works out to an average annual savings of approximately $370 or 28 per cent for residential customers consuming 50 GJ per year. The commodity rate decrease reflects a drop in global oil prices, which propane rates closely follow.
In Whistler, Terasen Gas is awaiting a decision by the BCUC on a previous application to adjust rates for 2009. That decision, which is expected by late March, will reflect the current conversion project from propane to natural gas. Until then, current rates are not expected to change.
Natural gas is a commodity traded on the open market like oil, gold or lumber. Factors affecting the price of natural gas include weather, supply and demand, international events and market speculation.
Terasen Gas earnings come from the delivery charges – what the company charges to bring the natural gas to a home or business. Delivery rates and midstream rates are reviewed by the BCUC once a year in December with any changes coming into effect the following January. Every three months, Terasen Gas reviews natural gas and propane commodity rates with the BCUC in order to ensure the flow-through rates customers are charged are sufficient to cover the cost of purchasing the gas.
Both the commodity and midstream charges are passed on to customers without mark up.
Terasen Gas is mainly composed of the operations of Terasen Gas Inc. and Terasen Gas (Vancouver Island) Inc., both indirect wholly owned subsidiaries of Fortis Inc. Fortis Inc., the largest investor-owned distribution utility in Canada, serves two million gas and electric customers and has more than $10 billion of assets. Its regulated holdings include Terasen Gas and electric utilities in five Canadian provinces and three Caribbean countries. Fortis Inc. owns non-regulated hydroelectric generation assets across Canada and in Belize and upper New York State. It also owns hotels and commercial real estate in Canada. Fortis Inc. shares are listed on the Toronto Stock Exchange and trade under the symbol FTS. Additional information can be accessed at www.fortisinc.com or www.sedar.com
Media contact:
Michael Chisholm
Corporate Communications Manager
Terasen Gas Inc.
(604) 576-7300
Email: Michael.Chisholm@terasengas.com
Corporate Communications Manager
Terasen Gas Inc.
(604) 576-7300
Email: Michael.Chisholm@terasengas.com
Background - Estimated change in annual bill
Rates for Typical Natural Gas Residential Customers
|
Lower Mainland and |
Revelstoke Based on 50 GJ/year | |||
|---|---|---|---|---|
| Current | Proposed Jan 1 |
Current | Proposed Jan 1 | |
| Basic monthly charge | $11.13 | $11.99 | $11.13 | $11.99 |
| Delivery charge/GJ | $2.728 | $2.845 | $2.728 | $2.845 |
| Midstream | $1.326 | $1.015 | n/a | n/a |
| Commodity charge | $7.536 | $7.536 | $21.372 | $13.640 |
| Estimated total annual bill | $1,235 | $1,227 | $1,338 | $968 |
A gigajoule is a measure of energy. One gigajoule is equivalent to 278 kilowatt hours of electricity. One gigajoule of gas can heat a typical 2,000 square foot home for one day during the winter.
Hot tips to help you save energy
- Upgrade your furnace. If your furnace is more than 13 years old, it’s likely a low-efficiency model. Consider upgrading to a high-efficiency furnace with an AFUE (annual fuel utilization efficiency) of 90 per cent or more. The Terasen Gas ENERGY STAR ® Heating System upgrade program offers credits and manufacturer offers for people purchasing high-efficiency furnaces and boilers. Some heating systems come with a 97 per cent AFUE. Check out our ENERGY STAR Heating System Upgrade program at http://www.terasengas.com/
- Tune up your furnace. Change or clean your furnace filters during the heating season. Regular maintenance will ensure things are running properly and will save you money over time.
- Turn your thermostat down. Turning your thermostat down to 20°C during the day and 17°C at night can save as much as 15 per cent on your heating costs.
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