A Consumer-Centric Energy Rates Model

RateVision focuses on the impact of energy demand and supply scenarios on different consumer categories. Applying current variable rate and fixed charge design rules at provincial level, the model forecasts how energy rates and charges for different energy commodities will change over time. Typical consumption profiles are used to derive future average bills.

Modeling Tomorrow’s Consumer Energy Landscape

The model leverages results from NATEM energy scenarios to analyze how economic growth, electrification, and energy policies including emission reduction targets will affect future energy rates for consumers. Fuel switching projections from NATEM are used to inform the consumption behavior of a typical household, business, or industrial plant to predict how average energy bills may evolve. The model operates at provincial granularity, capturing differences in the regulatory environment and in consumption patterns.

The model covers the three consumer categories: residential, commercial, and industrial consumers. It includes analysis of all standard rate components, such as commodity production cost, transmission and distribution charges, and carbon pricing. In addition to electricity and natural gas, the model can be used to evaluate price trajectories for gasoline, diesel, and new fuel types such as RNG and hydrogen.

RateVision has been used by decision makers to:

  • Assess how demand growth and energy policy scenarios risk to increase electricity and natural gas rates
  • Evaluate the cost impact of blending clean fuels with natural gas
  • Perform policy impact assessment on transportation fuel prices
  • Consider infrastructure abandonment strategies, estimate stranded assets costs, and assess different approaches for cost absorption
  • Compare different net-zero scenarios’ effect on total consumer energy bills
  • Assess risk of grid disconnection and death spiral effect
  • Advise on risks of maintaining current energy rate design in net-zero scenarios
  • Analyze energy burden in future energy scenarios

Translating from energy system changes to rate impacts

Our economy-wide energy system model (NATEM) provides optimal technology solutions for meeting energy service demands in all end-use sectors to achieve energy transition targets, including net-zero. These optimal solutions provide information on costs for supplying specific energy commodities.

To recover these investments under current regulatory and legislative frameworks, these costs are passed on to end users, often increasing energy rates or prices for different consumer categories. The RateVision model allows to view system level energy plans under the lens of utility-level planners and distributors to understand implications on consumers of energy policies and transition scenarios.

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