Re open letter to Bruce McLennan, chair Yukon Utilities Board:
The Yukon Utilities Board finalized two decisions in the past month, both of these negatively affecting the bottom line for ratepayers of electricity.
The first decision will see our general residential and small business bills increase on July 1 by somewhere in the three per cent range, for what is called a Rider F change advisory Ã‰ an increase in the price of fuel oil.
Granted the price of this commodity has gone up in the last quarter, so we expected some increase. This is not our beef.
The issue here is that the utilities made application to charge for increase in fuel prices for all the diesel being used, above and beyond what the board accepted as the forecast in the last general rate review.
Although there is a government decree, Order-in-Council 1995/090, giving Yukon Electrical and Yukon Energy the statute to adjust their rates to retail customers and major industrial customers so as to reflect fluctuations in the prices for diesel fuel, it does not specifically give them intrinsic rights to charge for price fluctuations in the amounts of fuel they have burned above and beyond their own forecasts. These forecasts were accepted and so approved by this board.
Accordingly, UCG submits that this board has the mandate and the obligation to reflect these forecasts in their future decisions on Rider F, until there is another rate review.
The second decision will cost ratepayers more as well, albeit just a few cents per billing.
This comes with Order 2011-05, which provides new rate schedules for the companies; i.e. charges resulting from the blending of two riders into the common customer and energy charges. This will result in an easier bill to read with new basic customer charge of $14.65; combined with a new energy charge regime of 12.14 cents per kilowatt hour for first 1,000 kilowatt hours.; 12.82 cents per kilowatt hour between 1,001-2500 kilowatt hours, and 13.99 cents per kilowatt hour in excess of 2,500 kilowatt hours.
In board order 2010-13 appendix A, Reasons, on page 33, the board specified a rate of 12.13 cents per kilowatt hour for the first 1,000kW.h. UCG requested this be tweaked even more to 12.12 in the compliance filing, so that this new method would reach parity with the old prior billing.
The companies went ahead and used what they wanted, the 12.14 cents/kW.h. What this means is that the utilities will be receiving several cents more for each billing than if they were still using the prior billing schedules with the rate riders isolated.
This reminds me of the financier in England who took a few cents off each account in each billing period.
When all was said and done, he made millions of dollars from this trivial amount.
The companies will accumulate these few cents per each customer billing into perpetuity and this becomes thousands of dollars each year.
Why did this board do nothing to correct these matters and so protect the ratepayer?
Roger Rondeau, Utilities Consumers’ Group