8-K

ENBRIDGE INC 8-K Report (Apr 2, 2012)

Filed April 2, 2012For Securities:ENBENBMFEBBGFEBRGFEBRZFENBGFENBRFENFFFEBGEFENBFFENBHFENBNFENBOFENBSFEBBNFENNPF

Summary

This Form 6-K filing by Enbridge Inc. (ENB) on April 2, 2012, pertains to a press release from Enbridge Gas Distribution Inc., a subsidiary. The key information for investors concerns an approved adjustment in natural gas rates by the Ontario Energy Board (OEB), effective April 1, 2012. The adjustments are primarily driven by decreased commodity costs and transportation expenses. For typical residential customers who purchase both gas supply and transportation from Enbridge Gas Distribution, the company anticipates an annual decrease of approximately $107. Customers who obtain gas supply from a third-party marketer and use Enbridge for transportation will see a smaller annual decrease of about $12. These changes reflect Enbridge Gas Distribution's practice of passing through gas supply costs without a markup and adjusting for variances through a Cost Adjustment mechanism. The filing also reiterates Enbridge Gas Distribution's significant market position and its history as Canada's largest natural gas distribution company.

Key Highlights

  • 1Enbridge Gas Distribution received OEB approval for new rates effective April 1, 2012.
  • 2Typical residential customers buying supply and transportation from Enbridge Gas Distribution are expected to see an annual bill decrease of ~$107.
  • 3Residential customers using Enbridge for transportation only are expected to see an annual decrease of ~$12.
  • 4The rate adjustments are primarily due to decreased commodity costs and transportation expenses.
  • 5Enbridge Gas Distribution does not profit from the price of natural gas; costs are passed through to customers.
  • 6The company highlighted that natural gas remains the most economical heating choice in Ontario compared to electricity and oil.
  • 7Enbridge Gas Distribution serves approximately 1.9 million customers across Ontario, New York State, New Brunswick, and southwestern Quebec.

Frequently Asked Questions

The primary driver for the rate adjustments is a decrease in the cost of natural gas commodity prices and lower costs for transporting natural gas from Western Canada and the United States to Ontario.

For typical residential customers who buy their gas supply and transportation from Enbridge Gas Distribution, the overall annual cost is expected to decrease by approximately $107. If you purchase your gas supply from a different marketer and only use Enbridge for transportation, the annual decrease will be about $12.

No, Enbridge Gas Distribution Inc. does not earn a profit on the price of natural gas. The gas supply costs are passed directly to customers without any markup. Any difference between forecasted and actual prices is either collected from or returned to customers via a Cost Adjustment.

Yes, the filing states that natural gas remains the most economical choice for home and water heating in Ontario. Over the past five years, it has been, on average, about 55% less expensive than electricity and 56% less expensive than oil.