Jasmin Gross, business analyst for energy marketing and business analysis, provided the public and councillors a presentation on proposed changes to utility and gas bills next year. Council voted unanimously to increase residential utility service rates by approximately three per cent per residential and small commercial user.--NEWS PHOTOS BRENDAN MILLER
bmiller@medicinehatnews.com
Following two public presentations Monday night, city councillors voted unanimously to adopt changes to the electric and gas utility bylaws that will see a small increase to bills in 2026.
Changes to the 2026 budget will affect customers differently by class, however the average residential monthly electric bill will experience a year-over-year increase of $3.06.
The increase includes $2.25 for electric utility services and $0.81 for gas utility services.
According to staff, city council is the regulator of rates in Medicine Hat, however the city chooses to follow in principle the allowable return on capital set by the Alberta Utilities Commission, which is a choice of council.
“We’ve opted to do that historically simply because that is a defensible mechanism to make sure that we are not overcharging our ratepayers and that we are not abusing our exemption under the electric utilities act,” said Rochelle Pancoast, managing director of energy, land and environment.
Jasmin Gross, business analyst for energy marketing and business analysis, provided a presentation on how rates have been adjusted, citing a combination of factors for the increase, including capital budget assumptions as well as the Alberta Utilities Commission regulated return on equity.
Gross says the 2026 operating budget was developed with an emphasis on affordability while ensuring the long-term and short-term financially sustainability of each utility provider.
“At the residential, commercial and large-commercial customer level, the monthly increase of an average residential customer and commercial customer is roughly three per cent a month,” Gross explained. A large commercial customer will experience an increase of approximately four per cent in 2026.
A capital amendment increased costs to a new substation project in the city’s southwest by an additional $16 million that was not estimated in original building costs due to a need to change the site’s location.
The original $24 million was approved by council in the 2022-23 Utilities Distribution Systems business plan. However, that request was denied by the AUC in 2023 and the process of finding a new site began.
The total cost of the new substantiation is now pegged at $40 million, and is expected to be online in April 2027.
Following the presentation council heard from three residents who spoke against increasing utility rates and cited an increased cost in living, promises made for more affordability during the election and the effects that increased utilities can have on small businesses.
After public comments, Coun. Ted Clugston addressed members of the gallery and told them their concerns have not fallen of deaf ears.
“We are actually going to be dealing with this at committee this Thursday,” said Clugston, who is appointed vice chair of the Administrative and Legislative Review Committee. “I know it’s probably not as quickly as you would have hoped but there are many, many unintended consequences of changing budgets on the fly.”
There were no public speakers opposed to or in favour of changes proposed on gas distribution and councillors approved changes that include a weighted average cost of the city’s natural gas purchases for each month, as determined by the CAO, as well as an additional $0.07/GJ which represents energy procurement changes and a return margin.
promises made during the election and then immediately broken once elected….typical