Recent takers of fixed-rate power pricing feel left out of 8-cent loophole

By MEDICINE HAT NEWS on December 23, 2022.

https://www.medicinehatnews.com@MedicineHatNews

If the city is offering discounted utility rates, they should be offered to all customers, said a Medicine Hat women who falls outside of ability to renew fixed-rate power at 2022 prices for the first six months of 2023.

“I know what the rules are but it’s just not fair to a large group of people,” said Linda Lowartz, who was concerned about higher power prices in the summer and signed on to fixed-rate pricing in August.

Because that contract comes with a six-month minimum term, she will pay 8 cents per kilowatt hour power price into February (when default prices could be three times higher), but she is barred from extending the lower rate further.

About half of city power customers held fixed-rate contracts in mid-2022 and would be eligible now for new contracts. The 8-cent rate is available to default-rate customers as well, to whom the difference could be well more than $30 per month.

Almost all customers have the option to lock in that price this month by phoning customer service at city hall or going through the city’s website.

But those who first got on fixed rates after July 2022, have to wait six months before renewal, meaning sometime in 2023.

Lowartz said she sees the benefit, and is happy to have the lower rate though the coldest months ending in February, but she feels that, philosophically, a city-owned utility should offer pricing on a universal basis.

“We’re the only Medicine Hatters who can’t get the (lower) rate,” she said.

Administrators have said the process of change-over is complex, and they are working to ease the transition for Hatters.

In November council approved changes to contract options and a replacement formula to how fixed-rate gas and power rates were set in 2022. That takes effect Jan. 1, 2023, but since rates are outlined in bylaws, not as a matter of general business practice, the old rates are available until the current bylaw expires on Dec. 31.

That allows any customer who signed on more than six months ago to renew their fixed rate this month for a further six months.

New rates in 2023 will be updated on a quarterly basis and come with a 12-month term – a measure to add stability to city utility income, say administrators.

Default pricing is still available, as required by Alberta Utilities regulations.