The Ontario Energy Board is expected to develop later this year a 20-year- plan that would mean a huge reduction in heating costs, say consumer groups.

By Eva Janssen

Free Press Reporter

A lot of adults in rural Ontario may soon be smiling because of gas.

The Ontario Energy Board (OEB), which regulates the province's three main natural gas utilities, is expected to develop later this year a 20-year plan to expand the natural gas system in Ontario.

SAVINGS: If that happens, more Ontarians will be able to switch from oil or electricity to natural gas, saving hundreds, and in extreme cases, thousands of dollars a year in heating costs, consumer groups predict.

Natural gas, touted as a cheaper, cleaner alternative to oil and electricity, is available in cities and towns, but distribution in rural areas has been piecemeal, since it can be expensive and unprofitable.

That may change following an OEB hearing later this year when consumer groups, unions and gas companies will make recommendations for expansion.

The OEB, which approves all applications for expansion, will issue a ruling to serve as a guide for natural gas utilities planning to expand distribution lines. The three main utilities are Consumers Gas in Toronto, Union Gas' in Southern Ontario and Central Gas in Northern Ontario.

SUBMISSION:"Rural Ontario should be going together on this thing," said Stuart O'Neil, president of the Ontario Pipeline Landowners Association (OPLA), which is making a joint submission with the Ontario Federation of Agriculture.

OPLA has a stake in the issue because its 120 members, who have pipelines on their properties, would be the first to receive natural gas if utilities extended the lines, O'Neil said.

Switching to gas would reduce heating costs in agricultural and commercial sectors and boost competitiveness, he noted. '

Electricity is regarded as the most expensive heating method, followed by oil, while natural gas is seen as the cheapest.

Until now, gas utilities have expanded distribution lines to keep up with unprecedented demand for natural gas, a result of increased electricity costs through the 1990s and further deregulation of the gas economy. , There are currently about 62,300 kilometers of natural gas pipelines in Ontario and roughly 2.2 million natural gas users.

DEMAND RISING: With demand rising, however, the OEB has decided to streamline the process. Its hearing Postponed from Jan. 22 to an undetermined date is scheduled to last two to three week@.

Already, controversy is brewing over who will pay for expansion and, how - a key issue at the hearing.

"It certainly seems to be steaming,, up," O'Neil said.

Energy Probe, a citizen-based advocacy group in Toronto, charges that gas users are subsidizing new expansion. The organization is lobbying for a user-pay system - the norm in al-' most all North American jurisdictions with gas lines, said Tom Adams, director of utility research.

However, most Union Gas projects are not subsidized by existing gas users, said Diane Beattie. general manager for the central region.

Union Gas's London division, which encompasses Bayfield, Goderich, Stratford, St. Thomas and Woodstock, extended distribution lines to 15 communities last year and has added roughly 5,000 customers a year, up from the growth rate in the 1980s, Beattie said. The division has about 160,000 customers.

RATES FALLING: moreover, natural gas rates have been falling and the fuel is cheaper than it was in 1983, Beattie noted. A mid-efficiency gas, furnace and gas water heater can save more than $1,300 a year in an 1,800. - square-foot bungalow, Union Gas says.

O'Neil, who lives about two kilometers from the nearest Union Gas line in Lobo Township, figures he would save $800 to $1,000 a year if he switched to gas from oil, he said.

However, he wants the OMB to alter its criteria for line expansion to encourage gas companies to venture farther into rural Ontario.

Last summer, for example, Biddulph Township failed to get a gas line extended by seven kilometers because it didn't meet the energy board's criteria and the project was too costly at $1,600 per recipient, Reeve Earl French said.

OPLA and the Ontario Federation of Agriculture will recommend that gas, users be able to repay the cost of expansion over a 30-year period.

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