by Colin Smith
Some Alberta electricity users may see spikes in their bills with the removal of the price cap proposed as part of the recently introduced Provincial Budget.
The price cap initiated in June 2017 ensured that consumers on the default regulated rate option – who had not signed up for a retail plan – were charged no more than 6.8 cents per kilowatt-hour for electricity.
If the rate charged by the provider for electricity exceeded that amount, the government paid the difference above that price.
As part of the budgetary Ensuring Fiscal Sustainability Act that cap will be removed as of November 30. The act is currently being debated in the Provincial Legislature and requires passage before it becomes law.
“We feel the removal of the regulated rate cap ($0.068 kWh), may expose consumers to potential pricing spikes or volatility in the electricity market,” according to a statement provided by Alberta Co-operative Energy representative Doug Strobl.
The cap was introduced to reduce volatility in the deregulated electricity market, in which price spikes of up to 65 per cent in one month had occurred.
In 2018-19 it saved regulated rate option electricity users – residential consumers, farmers and small business operators – some $53 million.
Removal of the price cap follows the introduction of legislation to undo the previous government’s pending move to a capacity-based rather than energy-only electricity market.
“Whether it is a capacity or energy-only market, there will be challenges for consumers and retailers of energy products,” said the statement from the community-run energy retailer.
In an energy-only system, producers are paid for electricity that is sold into the wholesale power market, while in a capacity system, they are also paid for having energy capacity available if it might be needed.
The Alberta Co-operative Energy statement points out that competitive retail prices, such as it offers, have typically been lower than the regulated rates.
It’s expensive enough as it is. This is going to hurt a lot of people. I’m remembering what happened in Ontario.
Add this to everything else going up! Oh, an NO raises to cover it….good times! 😡
Thanks UCP!
This is what happens when people choose Conservative. Don’t like it, don’t vote them in….
Allison Meunier many of us didn’t.
Good to hear
Dustan McLean many did, they won with a near 70% mandate in our riding.
The deficit needed to be addressed but it shouldn’t be done on the backs of people who can least afford it.
Thanks UCP, and the ignorant folks who voted them in! Sad part is you’ll never admit you made a terrible mistake.
Dustan McLean don’t think so
Insurance rates also gone up due to the removal of price cap
This is such craziness. They’re already HIGH.
Removing the caps has zero to do with eliminating the deficit. It simply serves to line the pockets of international power corporations at the expense of Albertans. Here’s a backgrounder ~ https://energyrates.ca/why-alberta-electricity-bills-are-getting-higher-and-what-you-can-do-about-it/
Margaret Graham
Good thing the PC took away that carbon tax….
Keep knocking the people down. Lower wages. Straight time for overtime. Just keep the people down.
I don’t mind paying a little more in property taxes for the right reasons. But I DO mind paying increased taxes AND exorbitant utility bills. Electricity bills are already ridiculously and unreasonably high!
I personally find distribution and the other parts of my bill to be high. In the summer they’re usually way more than my electricity usage.
My bill is 85% none usage anyways, it is all the delivery and distribution, admin fees killing people and that is on the union world once again.
soon it will be do i eat or do i heat