What do transmission rates pay for?
Transmission rates pays for the cost of Hydro One to operate and maintain the high voltage transmission system that carries electricity from generating stations to large end-use customers or to electricity distributors.
Why are you filing for inflation now if you are going to file another application next year?
Earlier this year, the OEB directed us to change our filing from a five to a four-year transmission rate application to align with our distribution filing which caused us to re-think our investment plan. We are filing this one-year application at the rate of inflation to allow our new Board of Directors the time to conduct a diligent review of our investment plan and submit an application that balances the critical need to invest in our aging transmission system against our desire to keep customers’ rates as low as possible.
Did you consult with customers before submitting the application?
Yes. We held a comprehensive consultation session with our transmission-connected customers including local distribution companies and large businesses.
When do you expect a decision?
The Ontario Energy Board has not provided us with a timeline for a decision.
When will your next rate application be submitted?
We expect to submit a three-year transmission rate application in 2019 for the years 2020-2022.
Why do you need to increase transmission rates?
Our transmission system is aging and needs investment. We know every dollar we spend comes at a cost to our customers and the people of Ontario, which is why we are focusing on the most critical investments to keep the system safe, the power on and costs as low as possible. Safe, reliable power is essential to a thriving economy. Our continued investment in the high-voltage electricity system will help to build a strong and prosperous Ontario.
Why does so much of the system need to be replaced?
The electricity system in the province expanded rapidly in the 1950s. Now, those assets are reaching the end of their expected service life and need to be replaced or refurbished.
25 per cent of our 715 transformers are at the end of their expected service life
More than 40 per cent of our transformers will be at the end of their expected service life in the next five years
More than 8,000 steel towers are over 80 years old.
Where are transmission rates shown on the bill?
Transmission rates also known as retail transmission rates are a part of the Delivery line on the bill. These OEB-approved rates are variable and the amount you are billed will vary depending on how much electricity is used.
When will Hydro One customers see this increase on their bill?
Right now there is a lag between when transmission rates get approved and when they are billed under the Delivery line on customers’ bills. It is likely customers will not be billed new transmission rates until sometime in 2019.
What is the proposed increase for Hydro One’s customers?
If our application is approved as filed, customers will see the following bill impacts:
An average residential customer with a medium density using 750 kWh a month will see an increase of:
A general service energy billed customer using 2,000 kWh a month will see an increase of 0.1 per cent on the total bill.
The estimated average bill impact for a transmission-connected customer is 0.2 per cent.
What makes up the Delivery line on the bill?
Delivery covers the cost of delivering electricity from generating stations across the province to your home or business through high voltage (transmission) and low voltage (distribution) power lines. The Ontario Energy Board approves the Delivery rates that we bill our customers. The Delivery line on your bill is primarily made up of the following rates and charges:
Distribution flat charge ($ per month) – a fixed charge that pays for the costs of billing, meter reading, customer service and a portion of the costs of building and maintaining the facilities required to deliver electricity to your home or business, including providing 24-hour power restoration services.
Distribution volume charge (cents/kWh or $/kW) – a variable charge that is based on how much electricity that you use. This covers the remainder of the costs not included in the distribution flat charge, associated with building and maintaining distribution lines, poles, stations and transformers that deliver electricity to your home or business.
Transmission rates (also known as retail transmission rates – cents/kWh) – a variable charge that is based on how much electricity you use. This covers the costs of operating and maintaining the high voltage transmission system (transmission lines, towers and stations) that carries electricity from generating stations to electricity distributors or large end-use customers such as manufacturers and mines.
What makes up the Electricity line on the bill?
Most of Ontario’s residential and small business customers pay Time-of-Use or Tiered electricity prices that are set by the
Ontario Energy Board. These prices reflect the cost of generating electricity. Hydro One delivers electricity but does not generate it.