Enbridge Gas New Brunswick applies for delivery rate increase

Enbridge Gas New Brunswick announced today that it is applying to the New Brunswick Energy and Utilities Board (EUB) for an increase to its maximum allowable delivery rate. The proposed changes are primarily intended to bring customers’ savings in line with the target annual savings for each rate class while enabling Enbridge Gas New Brunswick to recuperate its costs.

“Enbridge Gas New Brunswick delivers natural gas to customers at rates which are based on local market conditions targeted to provide savings against alternative energy sources such as oil and electricity,” explains Dave Charleson, General Manager of Enbridge Gas New Brunswick. “When the commodity price of natural gas goes down, an increase in the delivery charge helps us to recover as much of our operating costs as possible, while still ensuring that typical customers see the target annual savings for their rate class.”

The development of the natural gas distribution system in the province has required significant upfront investment before Enbridge Gas New Brunswick’s customer base is large enough to permit the recovery of all of its costs. However, during this time, all customers benefit from having access to a source of lower cost energy. If approved, the rate increase proposed in this application will reduce the difference between Enbridge Gas New Brunswick’s actual costs and the amounts it currently recovers in rates.

For residential customers, who make up 70% of Enbridge Gas New Brunswick’s customer base, the changes would result in an increase of approximately $83 - $136 in annual delivery charges, depending on their rate class. The effect on other customers will vary depending on rate class.

With the proposed change in the delivery charge and the changes in market conditions, the overall annual cost of natural gas for a typical residential customer would actually be approximately $151 less compared to what was expected at this time last year. Typical residential customers will continue to see 20% target annual savings compared to their previous fuel sources.

“Natural gas will remain a smart, affordable, clean and efficient energy choice for New Brunswickers now and in the future,” said Charleson.

Enbridge Gas New Brunswick is proposing that these rates be implemented January 1, 2010 pending approval by the EUB.

Enbridge Gas New Brunswick is regulated by the New Brunswick Energy and Utilities Board and has a distribution network that includes approximately 750 kilometres of natural gas pipelines. With this investment more than 130 direct jobs have been created by Enbridge Gas New Brunswick and another 400 additional jobs have developed within the natural gas industry. Enbridge Gas New Brunswick serves nearly 10,000 customers in nine municipalities in southern New Brunswick.

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A typical residential customer uses 86-111 GJ’s of natural gas a year for home and water heating.

Savings depend on factors such as consumption, efficiency gains and/or fuel cost.