HomeMy WebLinkAboutFIN-09-044 - Natural Gas Transportation Rate1
Krrc~~R - - • -
Financial Services
REPORT TO: Councillor B. Vrbanovic, Chair, and Members of the Finance &
Corporate Services Committee
DATE OF MEETING: April 20, 2009
SUBMITTED BY: Wally Malcolm, Director of Utilities
PREPARED BY: Loraine Baillargeon, Manager, Asset Optimization
WARD(S) INVOLVED: All
DATE OF REPORT: April 15, 2009
REPORT NO.: FIN-09-044
SUBJECT: NATURAL GAS TRANSPORTATION RATE
RECOMMENDATION:
That the transportation component of the natural gas rates be decreased to 4.491 cents
per cubic meter from 5.284 cents per cubic meter for system gas customers of the City of
Kitchener effective May 1, 2009 to reflect the final rates charged by TransCanada
Pipelines as previously approved by the National Energy Board.
BACKGROUND:
The City's rate-setting practice is to establish the transportation component of natural gas rates
by using the National Energy Board ("NEB") approved rate for TransCanada Pipelines tolls.
TransCanada Pipelines applied to the National Energy Board and received approval for final
rates to be effective January 1, 2009.
REPORT:
Consistent with the final rates charged by TransCanada Pipelines as previously approved by the
National Energy Board, the Transportation component of the City's Natural Gas Rates will
decrease from $0.05284/m3 to $0.04491/m3 effective May 1, 2009.
FINANCIAL IMPLICATIONS:
The impact of the transportation rate decrease is expected to produce an overall rate decrease
of 2% or approximately $17 per year for the average residential customer. In these estimations,
staff uses a 2,100 m3 annual consumption as an average residential customer consumption.
COMMUNICATIONS:
The Utilities Division will work with the Communications Division to ensure that media are
provided with a media release to inform customers and an insert is being prepared to be
distributed with utility bills in May.
ACKNOWLEDGED BY: Dan Chapman, General Manager of Financial Services and City
Treasurer