In a letter to the editor on May 20th, 2018 a Hydro One customer from Kincardine commented: “Compared to Florida, Hydro One is robbing us”. Apparently Florida Power and Light only charges them $50 per month for the five months that they are there. I welcome you to have a read.
The customer complains about paying $150 per month for minimal service at his cottage to keep their insulated basement from freezing He says the meter barely turns and they are saddled with “delivery charges” that contribute to the huge bill.
Here is a no-win situation for Hydro One – and for me to provide commentary – because somebody is paying money for something that they don’t see the value in.
But I’m going to do it anyway just because there are a number of things that are wrong here that are begging to get addressed.
Even though I will be wrong.
I don’t mean to pick on this poor fellow, but it makes for a good example to walk through. It represents an outlying case, far from the average situation. I picked up on it because of the harsh term of being “robbed”.
First of all, according to Florida Power and Light they are one of the lowest cost jurisdictions in the United States at 25% below the national average. The average customer’s bill was $99 per month for 1,000 kWh of energy in the winter of 2017. That is very reasonable indeed. And our Kincardine resident says he pays $50 per month. That is really low. Perhaps it’s a condominium or something like that?
You could be living anywhere in North America and be complaining that you pay more for electricity than Florida.
During the winter in Florida your energy use is less than any other time of year. In Canada during the winter your energy use is higher than any other time of year. If you own a seasonal property or in a rural area you will pay very high delivery costs because it is very expensive to service those areas. There are a number of subsidies for customers in rural and remote areas, however they are specific to vulnerable customers. Drawing a comparison between these two opposite situations is almost meaningless other than to draw attention to things that aren’t comparable.
If you compare Florida Power to Hydro One it is easy to see why there is a cost difference. Florida enjoys significantly higher customer density than Hydro One. Almost 5 to 1. Based on that statistic alone I would expect to have lower delivery costs in Florida.
Florida has nowhere near the geographic challenges that Hydro One does. In Florida they spend significantly less on vegetation management than in Ontario – in part because they have 20% fewer lines. In 2016 Florida Power and Light budgeted almost $65 million compared to $178 million for Hydro One. The service area of Hydro One is massive compared to FPL. It isn’t much of a surprise that it costs more to service. And the Ontario policy is that the customer pays the cost.
The letter also mentions that “Florida does not have a Niagara Falls that delivers power almost for nothing”. I didn’t know that Niagara Falls delivers power for almost nothing – and I am pretty well up on things.
Niagara Falls doesn’t deliver power. That is what the transmitter and local distributor do. If you want electrons from Niagara Falls you’re going to have to pay someone for the 285 kilometers of conductors to get it to Kincardine. That’s what delivery charges on your bill are for. Regardless, it may be worth noting that the lowest cost generation is bought on the wholesale market and residential customers won’t see that.
Meanwhile, back to Kincardine. If you do not see the value in what you receive for $150 a month in charges then why not find a lower cost alternative? Perhaps a gas or oil heater. Maybe solar power?
More than likely it will cost more or be less desirable to explore one of the alternatives. Otherwise – why wouldn’t you have already done it?
So what I’m thinking is that you are getting pretty good value for $150 a month to ensure your pipes don’t freeze at your valuable seasonal property. And someone looks after that supply while you’re gone. Through the worst weather of the year.
It makes me sad that some people think they’re being robbed when it really isn’t the case.
Also, meters haven’t turned for a very long time. They’re electronic now.
Please be grateful for the things you have. One day they may be gone.
Derek
