New Gas Cost Adjustment Results in Refund of $104 During the Next Three Months
TORONTO, ONTARIO--(CCNMatthews - Sept. 25, 2006) - Enbridge Gas Distribution (TSX:ENB) (NYSE:ENB), a regulated utility, announced today that it has received approval from the Ontario Energy Board for its October 1, 2006 rates. There is no change to the Gas Supply Charge. The Gas Cost Adjustment refund, which is in place until December 31, 2006, has increased. There is a slight decrease in the Delivery Charge.
The Gas Supply Charge, or the price of natural gas for customers who buy the gas they use from Enbridge Gas Distribution, will remain the same at 34.1 cents per cubic metre. About 60 per cent of customers buy the gas they use from Enbridge Gas Distribution. About 40 per cent of customers buy the gas they use directly from natural gas marketers and the price they pay for the gas they use is determined by their contract with their marketer.
The Gas Cost Adjustment refund will increase to 11.56 cents per cubic metre from October 1 to December 31, 2006. The current Gas Cost Adjustment refund is 6.2 cents per cubic metre. The Gas Cost Adjustment reflects the difference between the actual natural gas costs incurred by the utility and the amount collected from customers through the Gas Supply Charge. The Gas Cost Adjustment refund will amount to about $104 during the next three months for a typical residential customer(1) who buys the natural gas they use from Enbridge Gas Distribution.
The Delivery Charge will decrease slightly for residential customers due to a decrease in transportation costs. This will result in a decrease of approximately $2 a year for the typical residential customer.
"Natural gas prices came down over the summer and are lower now than the same time last year," said Lino Luison, Vice President, Enbridge Gas Distribution. "Natural gas prices continue to fluctuate and we often see slight increases in prices during the winter when demand increases. However, natural gas remains the best energy source for our customers. Our residential customers save about $1,300 a year by using natural gas instead of electricity for home and water heating."
The majority of customers in Ontario use natural gas for home and water heating because it's convenient, reliable and it would cost them considerably more to use electricity or home heating oil. Over the past five years, natural gas has been on average about 40 per cent less expensive than electricity and 25 per cent less expensive than oil.(2)
The total annual bill for a typical residential customer using 3,064 cubic meters of natural gas for home and water heating is about $1,596. The same customer using electricity for home and water heating would spend approximately $2,899.3
As a utility regulated by the Ontario Energy Board, Enbridge Gas Distribution earns an approved rate of return on the capital it has invested in the distribution system. This is included in the distribution charges. Enbridge Gas Distribution does not earn a profit on the Gas Supply Charge.
Enbridge Gas Distribution delivers natural gas to about 1.8 million customers in Ontario communities including Toronto, Ottawa, Barrie and Niagara Falls. Enbridge Gas Distribution is a leader in delivering energy efficiency programs. For more information visit www.enbridge.com/gas.
Please see the attached backgrounder for more information about Enbridge Gas Distribution prices: http://www.ccnmatthews.com/docs/925enb.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 October 1, 2006.
(3) Natural gas and electricity prices are based on rates in effect as of October 1, 2006. Electricity rates based on Toronto Hydro rates. Costs have been calculated for the equivalent energy consumed and include all service, delivery and energy charges. GST is not included.
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