TORONTO, ONTARIO--(CCNMatthews - Jun 24, 2004) - Enbridge Gas
Distribution, a regulated utility, announced today that it has
received approval from the Ontario Energy Board to adjust its
prices effective July 1, 2004. The impact of the changes will
vary based on the amount of gas used and whether customers buy
their natural gas from the utility or a natural gas marketer.
Gas Supply Charge
The utility's Gas Supply Charge represents the actual cost of the
natural gas and is passed on to customers without mark-up.
Customers pay the same price that Enbridge Gas Distribution does
for the natural gas supply on the competitive market. As a result
of an increase in market prices, the Gas Supply Charge will
increase by approximately 16 per cent. The utility's new
residential gas supply price will be 28.06 cents per cubic metre.
The current price is 24.07 cents per cubic metre. For a typical
residential customer(1) who buys the natural gas they use from
the utility, this represents an annual increase in the Gas Supply
Charge of $122.(2)
Customers who buy their natural gas from a marketer will continue
to pay the price specified in their contract with that marketer.
The Gas Supply Charge reflects what the Company expects to pay
for natural gas supply for the next 12 months. This forecast is
reviewed quarterly and, if necessary, adjusted up or down. If
there is a difference between the forecast prices charged to
customers and the actual amount paid by the Company, the
difference is collected from or reimbursed to customers.
Delivery Charge
The Delivery Charge will increase slightly. This rise is
attributable to higher costs for natural gas storage which is
included in the Delivery Charge. The cost for natural gas storage
is directly linked to the natural gas supply price. Other
components of the Delivery Charge such as the cost of
transporting natural gas to Ontario and through the distribution
system to customers have not changed. This increase applies to
all Enbridge Gas Distribution customers, whether they buy their
gas supply from the utility or from a marketer. For a typical
residential customer(1), the annual increase to the Delivery
Charge will be approximately $4.
As a regulated utility, Enbridge Gas Distribution earns an
approved rate of return, or profit, on the capital it has
invested in the distribution system. This is included in the
Delivery Charge and has not changed.
Natural Gas Market
"We are seeing an increasing tightness between the demand and
supply of natural gas in the North American market which has led
to an upward pressure on natural gas prices," said Arunas
Pleckaitis, Vice President, Enbridge Gas Distribution.
"The environmental, economic and other benefits of natural gas
continue to make it the preferred energy fuel of choice across
North America," said Pleckaitis. "Increasing demand has put
pressure on traditional North American supply. We continue to
work with the industry to create a positive environment for
continued investment that will bring natural gas from traditional
and non-traditional sources to market to help meet growing demand
and address price volatility."
Natural gas continues to be the best choice for Ontario
consumers. Over the past five years, natural gas has been on
average about 43 per cent cheaper than electricity.(2)
Reducing Energy Demand
In addition to efforts to help increase supply, Enbridge Gas
Distribution also continues to help customers reduce energy use
or demand. Between 1995 and 2003, Enbridge Gas Distribution
helped customers save enough gas to serve 450,000 homes for a
year or take 650,000 cars off the road, reducing carbon dioxide
emissions by 2.5 million tonnes. Enbridge is the proud winner of
Canada's 2004 ENERGY STAR Market Transformation Award - Utility
of the Year. Enbridge Gas Distribution received the award for
providing leadership in overcoming market barriers, changing
consumer behaviour and encouraging use of high efficiency ENERGY
STAR qualified residential gas furnaces and boilers. A new
brochure for residential customers about reducing energy use is
available at www.enbridge.com/gas.
Enbridge Gas Distribution delivers gas to about 1.7 million
customers in its franchise area. Of those customers, about 60 per
cent buy their gas supply from the utility. About 40 per cent of
the utility's customers buy their gas supply directly from
marketers.
Please see the attached backgrounder for more information about
Enbridge Gas Distribution prices.
http://www2.cdn-news.com/database/fax/2000/enb_back.pdf
(1) A typical residential customer uses 3,064 cubic metres of
natural gas a year for home and water heating.
(2) Based on the annual bill for a typical residential customer
who buys their natural gas from the utility. Updated based on
annualized rates effective July 1, 2004.
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