Comparing Billing Regimes

In The Guelph Mercury on Thursday, 4 August 2011, an article appeared entitled ‘Guelph Hydro Residents Must Call for Time-of-Use Rate Start Dates’.   The quotation to consider is the one from one of the city’s residents, who notes that, by moving on to time-of-use rates:  ‘…not changing his consumption habits could cost him “between $25 and $30” every bimonthly bill.’

Going to the OEB website, one can pull up a cost tool for Guelph Hydro.  Assuming that this customer is an average consumer (800 kWh), with that consumption ‘spread across time’ in a typical way (64:18:18 between off-:mid-:on-peak periods), then the move from ‘two-tiered rates’ (conventional rates) to ‘time-of-use rates’ would change the monthly bill from $109.08 to $110.74 – a change of $3.32 over two months.  Now, consider a ‘large’ user – perhaps 1,600 kWh a month, with consumption more concentrated in peak periods (50:25:25 between the aforementioned times).  Their monthly bill would go from $209.56 to $215.42 – a change of $11.72 over two months.  To get a change of $25 over two months, I put in a ‘very large user’ (1,800 kWh), and then made the ratio 40:32:28 (that is, a disproportionate share of use during peak periods).

Of course, many are comparing present bills (on time-of-use) with past bills (on the tiered system) – rather than present bills (on the tiered system).  As an exercise, I took out some past bills (I am in the Waterloo North Hydro service territory), and put them into the same OEB bill calculator.  (Note that I assumed a 60:20:20 distribution of consumption across the different time periods.) The results are as follows:

Year	Consumption (two months, in kWh)	Bill (at the time of consumption, for two months)	Hypothetical bill (under present time-of-use rules, for two months)	Total percentage increase	Average annual percentage increase
2010	1,637	218.82	226.98	3.73	3.7
2009	1,850	214.34	252.28	17.7	8.9
2008	2,067	218.16	278.06	27.5	9.2
2007	2,046	226.30	275.56	21.8	5.4
2006	2,170	249.73	290.30	16.2	3.2
2005	2,250	241.02	299.80	24.4	4.1
2004	1,980	207.76	267.72	28.9	4.1
2003	910	108.69	140.64	29.4	3.7
2002	1,368	192.04	195.04	1.56	0.17
2001	1,047	119.95	156.90	30.8	3.1
2000	1,113	111.25	164.74	48.1	4.4
1999	806	87.93	128.28	45.9	3.8

Notes to the table:

1) The period investigated is July to September in each year, with the period either being the middle of the month to the middle of the month (1999-2000, 2005-2010) or towards the end of the month to towards the end of the month (2001-2004).

2) Calculations were completed as follows:  Half of the bimonthly was inserted into the bill calculator, and the resultant value was doubled.

And two final observations about these data:

1)      If we did not have the ‘Clean Energy Benefit’, the difference would be higher.  Nevertheless, for me, I could say that my electricity bill has gone up by just under 4% from last year.

2)      I calculated the 2002 value repeatedly.  I then recalled that that was the period in which the market was open (May to November 2002), and when prices rose dramatically for Premier Eves.  I found it striking that prices now are similar to what they were nine years ago.