Tolls and tariffs

What is a pipeline toll?

What is a pipeline toll?

Transcript:

• What is a pipeline toll?
• Pipeline Toll: the price charged by a pipeline company to use their pipeline
• Who decides what price is fair?
• That’s the job of CER’s Commission
• The pipeline company proposes how much they would like to charge for the use of the pipeline
• The parties that want to use the pipeline tell us what they are willing to pay
• Then the Commission listens to everyone’s ideas
• and makes a decision that is fair for everyone
• Our goal is to protect the interests of Canadians
• And keep the companies we regulate competitive
• To learn more visit our website

Our Role

In addition to making sure that pipelines are safe for people and the environment, the Canada Energy Regulator (CER) also regulates pipeline tolls and tariffs. Tolls are the price that a pipeline company charges its customers to ship product, such as oil or natural gas on its pipeline. The pipeline company uses toll revenues to pay for maintenance, to earn back the money spent to build the pipeline and to provide a return to its investors. Tolls also allow pipeline companies to safely operate and maintain pipelines.

A company cannot charge a toll for pipeline services unless it is included in a tariff that is filed with the CER or approved by a CER order. Pipeline tariffs specify the procedures by which shippers are to submit nominations for transportation service, including the form and timing of nominations. Sounds simple enough, but for some pipelines, a tariff could fill a large three-ring binder.

The Canadian Energy Regulator Act says that tolls must be ‘just and reasonable’ and not unduly discriminatory. Additionally, the Act does not allow any unjust discrimination in service – which generally means all shippers need to be treated fairly.

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