By COLLIN GALLANT on March 17, 2022.
City utility administrators gave hints about avenues they are studying for potential changes in billing for city gas and power later this year during an online forum meant to answer questions Hatters have raised about high utility bills.
It’s billed as a first foray in direct public engagement between top administrators and residents who submitted questions and could watch the noon-hour forum hosted on an internet meeting platform.
Attendees submitted question about consideration for “time of use” billing, or the rationale for specific fees and charges, contract terms and one asked for the business case for offering fixed rates in the first place, and whether it is was essentially a way for the city to raise prices either immediately or when rates trip over.
Rochelle Pancoast, managing director of strategy and analysis and a former head of the utilities support office, said customer costs play a large role in the utility department’s considerations, though the business must recover costs plus show greater benefit.
“Essentially it’s the taxpayers of Medicine Hat that invest in our business units, and because there is uncertainty of how they perform over time … we run those businesses like businesses,” she said.
“Ultimately we look to run them vary competitively, with a competitive advantage of lower cost and a dividend flowing back to the community.”
Only about a dozen viewers joined in the live meeting, though officials hope it will reach a wider audience as a video posted on the city’s “Shape your City” website. That site also features links, further information and an FAQ section.
Utility officials stated Wednesday potential changes are being examined, but won’t be unveiled until full analysis is performed.
That could explore the potential for longer-term contracts (currently prices are updated yearly), as well as the cost-benefit of employing time-of-use billing.
That could see rates rise and fall on an hourly basis based on demand, which could provide incentive for users to delay plugging in cars or doing laundry until lower-use periods like overnight.
“Longer contracts bring additional risks,” said Travis Tuchscherer, superintendent of business services at the power plant, but added, “We want to maintain choice.”
Another questioned why Hatters are not able to seek out better pricing with out-of-town power marketing firms.
“The simple answer is no, but we see it as a point of pride,” said Pancoast, referring to the city’s power franchise.
“We take that very serious, and it allows us to keep our charges lower than our peers, especially for distribution.”
The city’s power franchise allows it a local monopoly to sell power in the city, Redcliff and a small part of Cypress County, but as a self-sufficient supplier, those customers are shielded from fees to maintain the Alberta grid, which are otherwise charged uniformly across the province.
The city has long maintained its other fees are comparable or lower than other areas, and staff plan to release information soon comparing the relatively new municipal consent and access fee to other locations.
“There are a host of different methodologies about how it’s set, but Medicine Hat’s remains much lower,” said Tuchsherer.
Corporate services head administrator Dennis Egert also said the city is examining how to implement utility relief promised by the province, effective April 1 for power (potentially worth $50 credit for each month this past winter).
A potential rebate on gas would come into effect next October if the price rises above $6.50 per gigajoule. That is about one-third higher than unusually high prices this past winter, and well above the city’s fixed rate for gas of $4.35.
“We’re already offering a cap that’s significantly lower than what the province is talking about,” said Egert, referring to the fixed price, which is voluntary.
The fixed rate for power is 8 cents per kilowatt hour, which can be retroactively applied as credit to billed amounts from January if Hatters sign on this month.