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SHOCK: Utilities Group Seeks to End Residential Retail Choice; Supplier Counters Inaccurate Statements, Cites Utility Costs
The Electricity Distributors Association (EDA), representing Ontario utilities, recently "commended" a call from Andrea Horwath, leader of Ontario's New Democrats, to curtail fixed commodity price retail electricity contracts for residential customers.
"The EDA is calling for prompt legislative action to make this a reality."
"The EDA estimates that roughly a million Ontarians are currently supplied with electricity at their homes under the terms of retail contracts. It's further estimated that, on average, they incur a monthly commodity cost of approximately $105, in contrast to $70 for those who purchase electricity directly from their local utility and under price plans regulated by the Ontario Energy Board (OEB)," EDA said [all $ Canadian].
"Energy retailers have also accounted for an inordinate number of complaints to both the OEB and MPPs, due to concerns with matters such as door-to-door sales tactics and questionable renewal procedure," EDA said.
"An estimated $130 million in annual savings could be realized through the curtailment of energy retailers in the residential sector," EDA said.
But Planet Energy said that the EDA's statistics are factually incorrect, while citing the high costs of Ontario utility administrative charges.
Planet Energy noted that while the EDA pegged residential electric shopping at 1 million, as of February 2014, "there are in fact approximately 350,000 Ontarians currently enrolled under retail agreements."
"As the EDA has nearly tripled the number of actual customers enrolled under retail agreements, it is worth stating that all of the information following that statement became inflated," Planet Energy said.
Regarding customer complaints, "the number of consumer complaints against electricity suppliers received by the Ontario Energy Board [OEB] from January, 2011, to December, 2013, is down approximately 80%," Planet Energy said.
"However, utility escalated complaints during the same time period have increased by approximately 255%," Planet Energy said. "In fact, consumer complaints against electric utilities were greater than the number of complaints against electricity retailers during the latter part of 2013."
"The EDA further compounds its non-factual statements by stating that consumers under a retail agreement, 'incur a monthly commodity cost of approximately $105, in contrast to $70 for those who purchase electricity directly from their local utility.' The fact is that many consumers thus far during 2014 have saved money under a retail electricity agreement when compared to the rate which they would have paid with the utility, and during a high usage period as a result of the colder than normal winter," Planet Energy said.
"The EDA should focus its efforts on improving efficiencies of its member utilities for the benefit of all Ontarians. As an example to this point, the service and administrative costs of Ontario's electric utilities are to the knowledge of Planet Energy, the highest in all of North America. At present time, a residential customer pays approximately $257 per year for Customer Charges, which is in addition to charges such as transmission and distribution. In fact, utility charges alone can account from anywhere between 40%-90% of a consumers payable charges," Planet Energy said.
"Instead of lobbying for the elimination of customer choice in Ontario, the EDA should instead be focusing on how their members can reduce distribution, transmission and customer charges by becoming more efficient and restructuring their organizations," Planet Energy said.
"Planet Energy believes that the best way to improve Ontario's electricity commodity market, and allow consumers to make an apples-to-apples price comparison, is to remove the Global Adjustment and allow electricity supply in Ontario to trade openly -- much the same as natural gas has traded in Ontario since 1986 -- which has greatly benefitted consumers. Competition can only exist in an open and competitive market, and competition has always benefitted consumers."
"The goal and agenda of the EDA and NDP seems to be to thwart electricity competition in Ontario, stifle customer choice and move backwards to inefficient monopolies, which do not offer choice and competitive rates for Ontario consumers and businesses," Planet Energy said
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March 11, 2014
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Copyright 2010-13 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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