Newfoundland and Labrador Hydro adjusting electricity prices to reflect current oil prices

June 6, 2016 – Newfoundland and Labrador Hydro (Hydro) has filed an updated fuel price projection for the Rate Stabilization Plan (RSP) with the Newfoundland and Labrador Board of Commissioners of Public Utilities (PUB). This adjustment will decrease rates charged to Newfoundland Power and Hydro’s rural customers on the island by approximately 9.5 per cent.

Rates are adjusted every year based on the annual amount of water used for hydroelectric generation and the price of oil used to generate electricity at the Holyrood Thermal Generating Station. The RSP adjustment ensures that rates reflect the actual cost of electricity generation. Through the use of the annual RSP, electricity rates for most consumers are adjusted each July to reflect these items.

This electricity rate adjustment will be effective July 1, 2016. Rates are forecast to decrease by approximately 9.5 per cent. This change does not include further rate adjustments currently under review by the PUB for Newfoundland Power or Hydro, as well as the upcoming adjustment to HST, which will increase from 13% to 15% on July 1.

The application is a routine, annual filing required by the PUB to ensure electricity rates are accurately reflecting the cost of generation. The cost of oil is a direct pass-through to consumers and neither utility receives any profits or benefits financially from changes in oil prices.