Power business review will be out Nov. 25

By Medicine Hat News on November 8, 2024.

A special meeting of council will receive a long-awaited report on the city’s power business on Nov. 25.

Thursday’s meeting of the energy, land and environment heard the report, completed by consulting firm KPMG, will be discussed at that time.

“The independent experts will walk us through what they recommend in the energy business review,” said division head Rochelle Pancoast. “They have been asked to drive the best value for the community from the energy business, and they’ve focused analysis at a really foundational level at the governance, ownership and financial considerations.”

“It will be an interesting meeting and I’m looking forward to them sharing that information with the public and council.”

The third-party review was ordered in September 2023 after council approved relief payments and an interim power rate in response to record-high pricing that summer for default customers, and higher than usual increases in contract rates.

Since then, power rates have been set at the wholesale average in the Alberta power market, as opposed to the average of default prices in the province, a practice in place for more than a decade.

The report is expected to touch on a valuation of the city’s gas-fired power plant, which operates in a grandfathered municipal franchise area and can provide export sales at lucrative times to the provincial grid.

Provincial market rates have foundered, however, since the change, and in several energy and budget reports this fall, forecasters have predicted steep declines in dividends that are provided to the municipal side of the city.

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