Alberta's regulated rate option expected to soar next month — to its highest level in history | CBC News
The anticipated escalation of Alberta's standard electricity rate in August is projected to be significant. Subject to endorsement by the Alberta Utilities Commission, the rate will surge to 31.8 cents per kilowatt hour in Calgary and 32.5 cents per kilowatt hour in Edmonton.
Higher Electricity Rates In Calgary And Edmonton
Karina Zapata is a journalist who contributes to CBC News.
· Published: July 27th, 2023 at 7:00 AM Eastern Daylight Time | Latest Update: 8 hours ago
The anticipated electricity rate in Alberta for August is predicted to skyrocket to the highest amount ever charged to consumers in the province.
The current price for electricity with ENMAX in Calgary under the regulated rate option (RRO) stands at 27.5 cents per kilowatt hour, whereas with EPCOR in Edmonton, it is 28 cents per hour.
Subject to being approved by the Alberta Utilities Commission, there will be an increment to 31.8 cents per kilowatt hour in Calgary, and 32.5 cents per kilowatt hour in Edmonton.
Joel MacDonald, the creator of energyrates.ca, states that this surge indicates that individuals in Alberta who are on the standard rate might witness an approximate additional expense of $125 on their electricity invoices, in contrast to those who have opted for a consistent rate.
"This marks a historic peak for the RRO, and it also signifies the initial occasion when the real expenses are being passed on to the residents of Alberta," MacDonald commented.
This is due to the fact that the previous record was surpassed in February, with the rate climbing to 29.6 cents per kilowatt hour in Calgary and 32.9 cents per kilowatt hour in Edmonton. However, Alberta implemented a temporary price limit at the time, preventing residents from being billed more than 13.5 cents per kilowatt hour.
According to MacDonald, the high prices can be attributed in part to the fact that customers on the Regulated Rate Option (RRO) are obligated to repay the $200 million deferment from this year's price limit. Recent information from the market oversight authority of Alberta reveals that 35 percent of households in the province are on the RRO.
"The problem arises because we anticipate a significant number of people leaving the RRO due to its high cost, and the responsibility to repay those funds falls solely on our RRO clients," MacDonald explained.
According to him, when more individuals opt for either fixed or variable rates, the expenses for customers on the Regulated Rate Option (RRO) increase.
Albertans In Financial Crisis Suffer Most
According to Blake Shaffer, a faculty member in the economics department at the University of Calgary, Albertans who are struggling financially are facing the greatest impact from these extraordinary prices.
According to him, there are two categories of individuals who are still on the standard rate: inattentive residents of Alberta who are unaware that they haven't transitioned, and Albertans who have poor credit and are ineligible for a more affordable fixed rate.
He firmly believes that the state government should have modified that policy a while back.
It is a harsh twist of fate that the individuals in the province who are most economically disadvantaged and have the lowest credit scores are unable to benefit from the affordable electricity rates. It appears that this particular issue is an opportunity for the government to intervene and ensure the well-being of these individuals.
In the previous week, Premier Danielle Smith dispatched a directive to Minister Nathan Neuford, who is responsible for Affordability and Utilities, urging him to conduct a thorough investigation into gradually eliminating the standard electricity rate.
According to Shaffer, it is perpetually advisable to carry out reforms and explore superior alternatives. Nevertheless, by the time any modifications are put into effect, Alberta would have already overcome the critical period.
According to him, there are predictions of a decrease in prices throughout the upcoming year.
In the meantime, he suggests opting for a set rate if possible, and if not, exploring assistance programs aimed at tackling the escalating expenses.
Karina is a journalist/assistant producer employed by CBC Calgary. She was granted the 2021 Joan Donaldson Scholarship and has previous experience at CBC Toronto and CBC North. Feel free to contact her through [email protected].
