Applications

Applications

The Ontario Energy Board allows for three alternative rate-setting methods by electricity distributors: Price Cap Incentive Rate-setting (Price Cap IR), Custom Incentive Rate-setting (Custom IR), and Annual Incentive Rate-setting Index (Annual IR Index).  Grimsby Power Inc. uses the Price Cap Incentive Rate-setting method to apply for rate approval.  This method allows for rate rebasing every five years.  In the rate rebasing year Grimsby Power submits a full Cost of Service application.  In between Cost of Service applications Grimsby Power will apply for a mechanistic increase to distribution rates.  The mechanistic increase is determined by taking the Price Escalator, set by the Ontario Energy Board, and subtracting the Productivity Factor (0% applied to all distributors) and stretch factor. The stretch is assigned each year based on a three-year average of actual expenses less predicted costs. The table below shows the percentages below or above costs and the stretch factor that would be applied.  

Grimsby Power has consistently stayed between 10% - 25% below costs and had a 0.15% stretch factor applied. In 2019 a 1.35% increase in distribution rates was approved by the Ontario Energy Board.    

The most recent application, for rates effective January 1, 2020, can be found here.

For specific rates applied to Grimsby Power customers click here.