“allocating common costs is like trying to find a black cat in a dark room. [pause] Where there is no cat.”The Ontario Energy Board (OEB) released, on April 2nd, A New Distribution Rate Design for Residential Electricity Customers (.pdf), along with many documents from the period leading to the publication of the new Board policy.
It's notable beyond Ontario's borders as many jurisdictions are also attempting to cope with changing revenues and similarly looking to change pricing models.
From the OEB:
On April 2, 2015, the Ontario Energy Board (OEB) issued a new rate design policy that will change the way local distributors bill their residential customers. Distribution charges, currently a blend of fixed and variable (per kilowatt-hour) rates will be an entirely fixed monthly service charge by 2019. Fair billing, grid innovation and enabling customer uptake of new technologies are among the OEB’s objectives for this change.I agree with the change, although not without concerns - some of which I noted when writing on the initial discussion document. I'll have more to say on the policy document on my Cold Air blog - because the OEB's documents are poor, which is almost certainly requisite for any document produced in Ontario's ridiculous electricity policy environment.
I'll try to keep my comments, and citations, in this short post relevant to a broader audience.
Utilities in many jurisdictions, including Ontario, are dealing with a need to maintain infrastructure while demand levels are dropping, and the problems are particularly acute where solar panels are being rapidly installed within distribution networks (often net metering jurisdictions).