Data quality, concepts and methodology: Electric utility construction price indexes

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(Table 327-0011, 1992=100 annual; Indexes are from 1992 to present)

1. Distribution systems
2. Transmission lines systems

Introduction

These indexes measure price change for construction of two separate models of electric utility plant. Each model was developed using project data from major Canadian electric utilities. Each model portrays an average mix of materials, labour and equipment developed from a variety of projects in a specific base period. This modeling technique provides the framework for the development of simulated plant indexes for construction work and machinery and equipment.

Characteristics

General

Direct costs associated with the construction work and machinery and equipment components are represented by various combinations of price index data: construction work indexes are a combination of indexes for work in place for such items as earthwork and structural steel, and indexes covering major material and labour inputs.

Indirect costs covered include interest foregone during construction, and design and administration costs, whose movements are indexed from salary survey data. (An aggregation excluding interest foregone is also available.)

Prices used

Machinery and equipment

For domestic equipment, prices used for machinery and equipment are manufacturers' selling prices. For imported equipment, foreign price indexes are used.

Wage rates

Basic union wage rates are used for construction trades. Employment, earnings and hours survey (SEPH) data on average weekly earnings (including overtime) for salaried employees are used for engineers, technicians, clerks and draftsmen.

Interest foregone during construction

ScotiaMcLeod provincial bond yield average index is used.

Adjustments to prices

Price indexes are not adjusted for the Goods and Services Tax. Price indexes of imported equipment are adjusted for exchange rates and where applicable tariff rates.

Weight base

Indexes 1 and 2

Gross capital additions made by major utilities in the several years prior to 1992 were converted to base year dollar values. This data was then utilized to produce a weighted average expenditure for the classes of construction specified.

Index formula

A fixed-weighted price index formula of the type described in the Introduction of this catalogue was used.

Revisions

Publication year estimates, if shown, represent the first half of the calendar year, January to June. Publication year and previous year estimates are preliminary.

Reference documents and further reading

For further information, contact Dissemination Unit at telephone: 613-951-4550, toll-free: 1-888-951-4550, fax: 613-951-3117, e-mail: ppd-info-dpp@statcan.gc.ca, Producer Prices Division, Statistics Canada, Ottawa, Ontario, K1A 0T6.

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