Friday, August 1, 2014
Toronto Hydro applies for rate increases
The utility says additional cash is needed to deal with the city’s “aging electricity grid” and to better prepare for “extreme weather events.”
Toronto Hydro has submitted a five-year rate-increase application to the Ontario Energy Board, claiming to need $4 billion to address such needs as increased maintenance, additional operational support, the replacement of “aging assets” and to put in place precautions for “extreme weather events.”
What this could mean for residential customers is an average increase of $3.54 per month for an average household over the next five years.
For 2015, customers would see an increase of $3.10 per month for an average household. The monthly increase would then change every year for the subsequent four years, going as high as $5.47 a month in 2018 and as low as $1.78 in 2019.
Toronto Hydro faced criticism last December after a severe ice storm knocked out power to as many as 300,000 people. Power was restored in stages, but some residents were without power over Christmas and many expressed frustration with what they said was a lack of communication on the part of the utility.
The ice storm cost Toronto Hydro around $13 million, but President and CEO Anthony Haines said in January customers wouldn’t be on the hook it.
Toronto Hydro spokesman Tanya Bruckmueller said Friday that Haines’ promise still stands, and that the problems the energy provider faced during the ice storm was a factor in deciding that more funding is needed.
“It’s not necessarily as a direct result of the ice storm, but it helped influence some of the projects that we’re applying for,” said Bruckmueller.
She added additional funding is needed to upgrade “obsolete equipment” and putting in place “resiliency measures.” However, she couldn’t immediately say if any of the increased funding would go towards better customer communication.
Bruckmueller said 26% of Toronto Hydro’s “assets” are past life expectancy, and that the utility is “seeing a number of failures as a result of defective equipment, and that is because of age.”
If Toronto Hydro’s application is approved, increases will take effect May 1, 2015.
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