So it appears the cost of electricity may be going up...I can live with that. I usually pay on the order of $30/month, and I know I could be more energy conscious if I needed to. I expect costs to rise every so often, so I'm not really concerned (though for people who have to pay for an entire home's worth it's a different story). However, one thing that bothered me was this statement:
What the hell?Energy Minister Donna Cansfield says Ontarians have to pay the real cost of generating electricity.
The board will estimate what the cost to generate power will be over the next year, and factor in the 377 (m) million dollars Ontarians underpaid on their bills last year.
I'm not 100% sure what "underpaid" refers to in this case, but I figure it's one of two scenarios, both of which piss me off:
1) By "underpaid", they mean that some people basically haven't paid their bills in full (or at all), which means they're owed money. Well guess what? I pay my bills every month, in full, and on time. If this is what's meant by "underpaid", then go after the people that haven't paid their bills. Don't force me to pay for electricity that I never used.
2) By "underpaid", they could also mean that it ended up costing them more than they figured to supply people with electricity, and that their rates should have been higher, so they're going to make it back by charging us more this year. That doesn't fly in the real world, why should it work now? If I hire a roofer to redo the roof on my house and he charges me $1000 when it's finished, he can't come back to me 6 months later and say "well, you know what, it turns out that with overtime and extra supplies, it actually ended up costing me $1200, so I'm going to need you to pay me another $200." Yeah, that's gonna happen.
It's not my fault that other people don't pay their bills. It's not my fault you took on additional expense. Don't charge me for things that aren't my fault!
2 comments:
James...
I think (again, could be wrong) that the Hydro rates we pay are false... they're subsidized... there's government regulation on hydro rates that have been keeping them falsely low... so the hydro companies, who have very little choice in what they charge, are losing money..
I think you're right on the subsidies, and I know that we've been paying less than what it actually costs for the hydro and so the power companies lose money. But I don't agree that they should be able to charge us for that. Now that it's deregulated, these companies have chosen to be electricity distributors. They chose to work under the gov't subsidies, so they should be the ones assuming the losses, not me. To quote the infamous Mr. Renaud, "It's not my problem".
Now, I'm not naive enough to think that they wouldn't charge me for it one way or the other. Even if they didn't have an explicit charge for reducing their debtload, they'd just jack up the rates a bit to compensate. It's not the fact that I'm paying more that bothers me, it's simply the reasons why they want me to pay more. Charge me what it costs to give me electricity. No more, no less.
It seems like they're losing the battle on this one, though. The article has the loss at $377m for last year. Right now, I pay about $1.40 per month as a "debt retirement charge". So assuming every household pays that amount 12 times a year, we're looking at about $70m. Now I'm guessing that amount is proportional to electricity usage, and that mine is on the low end, but even if you double that to $140m, you're still only half way to covering the previous years losses (assuming they were simlar to last year's).
If we've got these gradual increases over time, these companies won't be in the black for a long time. Sure, they'll lose a little less money each year, but it will take a long time before they start turning a profit, and they'll still have debt to pay down even while turning a profit. And we're going to keep paying off their debt for the next half-century. That's my worry. This is the problem with having these gov't subsidies artificially keeping prices low.
Of course, it appears that I'm advocating the complete removal of government subsidies for everything, which isn't my intent. And I'm not sure what the solution is, really. I'm just not convinced of why I should have to pay down the debt of a (semi-)private company, even though the alternative is higher prices. Let prices spike a little and watch how much people start to conserve electricity. People who don't will pay for it. Less electricity usage means lower costs to supply electricity from the distributor, yet higher income due to the higher rates, which means they get off the subsidies quicker, which means they pay down their debt quicker, which means I stop ranting quicker. :)
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