The Council of Canadians - Winnipeg Chapter

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Why We Need the PUB

Posted by Winnipeg Chapter on October 20, 2020 at 4:05 PM

From our friends at the Consumers’ Association of Canada

 

Fast Facts:

The Costs and Benefits of Independent Regulatory Oversight

 

The Manitoba Public Utilities Board (PUB) provides rigorous, evidence-based oversight of Manitoba’s Crown corporations for the protection of consumers. Thanks to the PUB, rates for Crown corporation services in Manitoba:

 

  • are not unjustifiably high,
  • do not change unpredictably, and
  • are just high enough to support efficient, effective and long-term services.

 

This security comes at a cost, but these costs are low, and they are far outweighed by the benefits and savings they bring to consumers.


Costs of Regulation are Low

To use Manitoba Hydro as an example, the cost of the PUB’s regulatory process is a very small portion of the corporation’s revenue requirement. Over the past three years it has averaged less than 0.25% of Hydro’s anticipated annual domestic revenues.

 

For a customer who uses approximately 1,000 kWh of electricity each month (for example, a home that doesn’t use electric heat), the cost of the PUB’s process adds only a few cents to their monthly bills:

Year Estimated Monthly Bill Cost of Regulation (per monthly bill)

2017/18 $90.04 $0.16

2018/29 $93.68 $0.21

2019/20 $96.02 $0.25

 

Regulation results in significant savings for consumers

 

Despite its low costs, the PUB’s rigorous oversight ensures that the rates charged are set with consumers’ best interests in mind. In each of the past three years, the PUB approved smaller rate increases than Manitoba Hydro asked for, which saved consumers money. The same customer who uses 1000 kWh per month has saved the following amounts each month for the last three years:

Year Monthly savings attributable to PUB oversight

2017/18 $3.96

2018/29 $7.75

2019/20 $0.96

 

PUB has significant positive impact on Manitoba ratepayers

 

Although these numbers may seem small, the hypothetical Manitoba Hydro customer in the above examples has, on average, spent less than $2.50 per year in order to save more than $50.00 per year thanks to the PUB’s oversight.

 

Customers of other Crown corporations experience similar benefits, also at costs that are only fractions of the corporations’ annual revenues. Manitoba Public Insurance customers, for example, have paid on average less than $1.75 per vehicle per year for the PUB to ensure that the rates they are charged are appropriate.

 

The PUB ensures that Manitoba consumers pay rates that are fair, just and reasonable. The PUB ensures that rates are set with Manitoba consumers’ best interests in mind, through a rigorous and evidence-based process.

 

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