Attention News/Business Editors
For Immediate Release
August 22, 2007
OTTAWA/TORONTO – The McGuinty government is being asked to overturn an Ontario Energy Board (OEB) Decision that means that Union Gas’s Texas-based owners, Spectra Energy (formerly Duke Energy) will get to pocket an estimated billion dollars over a ten year period that would otherwise gone to their customers. In documents filed today with the Ontario cabinet, the Vulnerable Energy Consumers Coalition (VECC), a coalition of seniors and tenant organizations representing low and fixed income customers, replied to Union Gas submissions that sought to justify the OEB decision to deregulate the natural gas storage market.
The effect of the Board-ordered deregulation is to give all the revenue earned on the storage sold to non-Union customers to Union’s American parent. Prior to this, Union customers were credited with most of the revenue from these storage sales because they had paid in their rates to develop the storage. This means, after a brief transition period, a loss of an estimated one hundred million dollars per year to Union’s customers which will be have to be made up in increased rates. All natural gas customers pay for storage in their rates that helps to meet winter heating demands. Part of the annual one hundred million dollars paid to Union’s owners will include an additional amount of $40 million dollars paid by Enbridge customers to Union for storage it traditionally rents from Union.
“The Ontario government must tell Union’s customers why it’s necessary to give a billion dollars of Ontario consumer money to Spectra when that money has been obtained by the use of storage facilities that the customers already built for Union with their rates”, Michael Janigan, Executive Director and General Counsel of the Public Interest Advocacy Centre which represents VECC. “This money belongs to customers. Sending it to Texas won’t help build any new storage, and won’t save any energy in this province”, Janigan added.
Other major natural gas consumer groups have also appealed the controversial OEB decision. The Industrial Gas Users Association (IGUA) and the Consumers Council of Canada (CCC) have also filed petitions to the Ontario Cabinet challenging the decision that would deregulate all Union storage that is not now needed to serve its own customers and give the storage rental revenue to the company.
VECC has requested that the Government return the matter to the OEB for review with a view to changing its Decision so that Ontario customers will be protected.
Reply to the Responses Filed to the Petition of the Vulnerable Energy Consumers Coalition to the Lieutenant Governor in Council to require the Ontario Energy Board to hold a hearing with respect to the Order of the Ontario Energy Board of May 22, 2007, made in a proceeding initiated by the Ontario Energy Board to determine whether it should order new rates for the provision of natural gas, transmission, distribution and storage services to gas-fired generators (and other qualified customers) and whether the Board should refrain from regulating the rates for storage of gas identified as EB 2006-0322, EB-2006-0338, and EB-2006-0340.
Download File: reply_to_the_responses_filed_to_lgic_petition_final.pdf [size: 0.04 mb]
See also: Letter and Petition of VECC, June 19, 2007
For more information:
Executive Director and General Counsel
Public Interest Advocacy Centre
1204 – 1 Nicholas Street
(613) 562-0007 (Fax)