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As the Ontario electricity market deregulates the relationship
between generator, distribution company, retailer and
customer will change. Customers will be provided with
a breakdown of their energy costs to assist them in
choosing between competing retailers. Market participants
will be required to reconcile and account for energy
traded between the various parties.
From the Spring of 2002 the energy industry in Ontario
underwent a fundamental change in the way it provides
and delivers its products and services to customers.
For the first time since Ontario Hydro began generating
and selling electricity, there will be competition with
energy being retailed by existing Local Distribution
Companies (LDC's) and new market entrants.
Rates have been unbundled, with separate charges for
the wires and the energy commodity. Prices to all customers
vary, hour by hour, based on prevailing spot market
values. This will inevitably create a trend for larger
customers to move towards interval (time-of-use) metering
and more complex tariffs.
An Independent Market Operator (IMO) has been established
to track and reconcile energy traded by each retailer
and to subsequently produce a settlement of energy costs
between LDC's, independent retailers and the generator.
The settlement process determines the hourly cost per
KWh to be charged to retailers and to customers.
The first stage of the process is to derive a Net System
Load Shape (NSLS) for each LDC's area of supply. This
is achieved by taking the overall load profile and then
deducting the measured profiles of interval metered
customers, the calculated profiles of fixed loads such
as streetlighting, and an estimation of distribution
system losses.
Applying the hourly energy price against the NSLS produces
a weighted daily average price per KWh for each area
of supply. This price is downloaded to each LDC's billing
systems in order to calculate and invoice monthly energy
charges.
In order to trade in Ontario retailers are required
to have appropriate profiling and calculation tools
in place to assist them in meeting their market settlement
obligations. Kinetiq's
Settlement Module has been developed for this purpose
and is currently in service with the majority of LDC's
in the province.
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