Province announces changes to lower utility bills in Calgary, but no relief for Edmonton customers
The Alberta government is changing existing legislation to lower utility bills in Calgary.
Electricity customers are currently charged a local access fee, which is used to compensate a municipality for the use of its property to provide electricity services.
About 200 municipalities currently charge such a fee to electricity providers, but how the municipality calculates the fee varies across the province.
The fees, which may not exceed 20 per cent of the distribution charge for electricity and 35 per cent of the distribution charge for natural gas, must be approved by the Alberta Utilities Commission (AUC) and are regulated by the Municipal Government Act.
Edmonton and Calgary both have agreements with municipally owned subsidiaries, which exempts them from needing AUC approval.
Edmonton follows a consumption-based calculation for its fees, while Calgary bases theirs partially on market rates.
As a result, Calgary customers can see fees vary wildly, depending on the price of electricity or gas.
The government says Calgarians paid an average of $240 in local access fees in 2023 compared to the $75 paid by Edmontonians during the same period.
The province plans to amend the Municipal Government Act to ensure the AUC will have oversight of all local access fees, and prevent municipalities from charging fees based on variable costs of electricity or gas.
The changes will take effect immediately.
Based on the numbers provided by the government, the average Calgarian could save $13.75 per month.
"Thanks to Calgary's formula, relying on the variable default electricity rate. This led to the City of Calgary collecting $303 million in revenue from local access fees, which is a surplus of $186 million more in these fees being collected by the city than they budgeted," said Nathan Neudorf, minister of affordability and utilities.
Staff behind the website EnergyRates.ca say Calgary's local access fee is charged at 11.11 per cent of the Regulated Rate Option (RRO) plus 11.11 per cent of transmission and distribution costs.
In the summer of 2023, there was a record-high price surge in the RRO, with rates reaching 31.858¢/kWh in August, before dropping to 26.455¢/kWh in September.
"If the price of electricity was 10 cents one month and your local access fees were $10. If the price of electricity went to 20 cents, your local access fees would be $20.
"This produced a compounding effect when your electricity bill was going up significantly because the spot price of electricity was going up, you also had significantly increased local access fees. So people in Calgary were seeing double sticker shock," said Joel MacDonald of EnergyRates.ca.
The province also announced on Friday it would change the name of the Regulated Rate Option (RRO) for electricity customers to the Rate of Last Resort.
CTVNews.ca Top Stories
Grandparents killed in wrong-way crash on Hwy. 401 identified
A 60-year-old man and a 55-year-old woman killed in a wrong-way crash on Highway 401 earlier this week have been identified by the Consulate General of India in Toronto.
Police arrest 3 Indian nationals in killing of B.C. Sikh activist Hardeep Singh Nijjar
Three people have been arrested and charged in the killing of B.C. Sikh activist Hardeep Singh Nijjar – as authorities continue investigating potential connections to the Indian government.
Suter scores late goal, clinches series for Canucks
Pius Suter scored with 1:39 left and the Vancouver Canucks advanced to the second round of the NHL playoffs with a 1-0 victory over the Nashville Predators on Friday night in Game 6.
TD worst-case scenario more likely after drug money laundering allegations: analyst
TD Bank Group could be hit with more severe penalties than previously expected, says a banking analyst after a report that the investigation it faces in the U.S. is tied to laundering illicit fentanyl profits.
Quebec man who threatened Trudeau, Legault online sentenced to 20 months in jail
A Quebec man who pleaded guilty to threatening Prime Minister Justin Trudeau and Premier François Legault has been sentenced to 20 months in jail.
Human remains found in rural Sask. possibly a decade old, RCMP say
RCMP say human remains found in a rural area in central Saskatchewan may have been there for a decade or more.
Britney Spears 'home and safe' after paramedics responded to an incident at the Chateau Marmont, source tells CNN
A source close to singer Britney Spears tells CNN that the pop star is 'home and safe' after she had a 'major fight' with her boyfriend on Wednesday night at the Chateau Marmont in West Hollywood.
Canadian doctor concerned new weight-loss drug Wegovy may be used inappropriately
As Wegovy becomes available to Canadians starting Monday, a medical expert is cautioning patients wanting to use the drug to lose weight that no medication is a ''magic bullet,' and the new medication is meant particularly for people who meet certain criteria related to obesity and weight.
Drew Carey is never quitting 'The Price Is Right'
Drew Carey took over as host of 'The Price Is Right' and hopes he’s there for life. 'I'm not going anywhere,' he told 'Entertainment Tonight' of the job he took over from longtime host Bob Barker in 2007.