June 13th, 2024

City notebook: Power rates look stable heading into summer

By Collin Gallant on June 8, 2024.


This time last year, Hatters and all Albertans really were in the same boat, fighting off a tide of high power prices.

But now, as spring now turns to air-conditioning season, the tables have turned.

Power prices on the Alberta grid sat at zero for long stretches this week as the wind blew and the sun shone to feed a growing amount of renewable energy facilities. New big gas generators are online. Hatters are enjoying rates one-third less than those in the rest of Canada’s wild-west electricity market.

Rates go up and down, of course, but the ship seems to have stabilized.

Riding out such storms was standard procedure for the city over the years when high prices got folks asking about the benefit of public ownership of the power plant.

Wait a bit, the market will correct, and in the end, it’s a wash. Problem solved.

But that tact didn’t survive last summer’s power rate controversy. The majority of council members who took the trusted wait-and-see approach in June, gave in to a public pressure by September.

A major review is in the fall, but may deal a wildcard of extremely low power prices going forward.

Don’t think it can’t happen? Shale drilling brought a figurative explosion of natural gas production online in the late 2000s.

Huge new reserves should translate to profits-profits-profits, but in reverse fashion the glut caused prices to drop and profits to evaporate ever since.

This month natural gas is but $1 per gigajoule – about a quarter of what it was worth 15 years ago.

Is the same situation lining up for power, despite talk about demand growth, electric vehicles and huge needs of computing?

Maybe not, but even if, the city could face crisis either way.

Even if the carbon tax is removed – and Premier Danielle Smith said the provincial TIER levy on heavy emitters like power producers isn’t going anywhere – and increasing renewable power generation will drive power prices down.

So, the question for the City of Medicine Hat is not only how to make a profit in the power game, but also how to match or beat power prices offered outside the city?

How long will Hatters put up with paying more than their brother-in-laws on the farm?

Can Hatters be convinced that reducing production costs with a local wind or solar facility – or entering in a power-purchase agreement outside the city – is just as important as meeting so-called environmental goals?

It’s probably worth talking about sooner, rather than waiting to see.

This and that

— Hat-raised Ronnie Burkett received the Governor General’s Lifetime Artistic Achievement Award at a ceremony at Rideau Hall on Friday. A gala follows Saturday night in Ottawa.

– “Ghost signs” are a phenomena when renovations or a good scrub reveal signs of a bygone age. The “Sweet Caporal” sign that dawned again after the Central Block fire is a good example. Not quite the same level, is the Eagles Club sign freed from beneath the more recent advertisement for Whiskey Creek Pub on Gershaw Drive. The pub was sold last year and will be refitted to become a reception hall for nearby funeral home.

– After years of there being supposedly “no appetite” for multi-family construction in the Hat, there’s a glut of proposals to build condos and apartments in Medicine Hat. More on this soon.

– Get your Cypress County Citizen of the Year nominations in by June 14.

– It happened a couple weeks ago, but we need to note the passing of former Redcliff Mayor George “Kaye” Osgoode on May 7.

A look ahead

It’s June and there are only two weeks of hockey left. It’s rodeo weekend in Brooks. The city’s public services committee meets Monday.

100 years ago

Medicine Hat hosted the annual convention of the Masonic Order of Alberta at the Oddfellows Hall,’ the News reported this week one century ago.

The city also welcomed a delegation of dozens of newspaper editors on the annual tour of the Canadian Press Association. As well at the station, 200 Rotarians from the west coast bound for Toronto waved and hung bunting from two special runs of the Spokane Flyer.

Edmonton’s Ross Sheppard was off to Olympic team trials in the running hop-step-jump as well as the decathlon.

The Province of British Columbia had recorded a $3 million profit on liquor distribution over the past 12 months, it was reported as Alberta had just begun its controlled network at the start of the month.

Collin Gallant covers city politics and a variety of topics for the News. Reach him at 403-528-5664 or via email at cgallant@medicinehatnews.com.

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