City energy analysis director Travis Tuchsherer discusses a proposed corporate structure for Medicine Hat's energy business unit at a public open house at city hall on Friday. -- News photo Collin Gallant, June 6, 2025
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How would a city energy corporation improve profits, maintain franchise area or be held responsible and responsive to the public when operating a publicly owned power company?
Those were some of the questions Hatters had Friday during a Q&A session with city electricity officials at city hall.
Staffers and some elected officials say a corporate leadership board made up of industry veterans could more efficiently modernize facilities, meet challenges like decarbonization and the need for profits in city budget in a downbeat Alberta power market.
Hatters attending the first of two discussion sessions wanted to know how they would fit into the equation.
“I want to know how ratepayers (residents) will have input,” Hatter Debbie Hintz told the News.
About 50 residents took part Friday, mixing with city energy officials to answer questions and explain material.
“Some people wanted to share their views but there were lots of questions,” said division head Rochelle Pancoast.
“A lot surrounded how you insure a MCC is still representing community interests and how you ensure rates don’t go out of control.”
“We responded and encourage them to share there views at upcoming public hearing.”
A virtual question and answer session will be held on June 11, while the formal public hearing will beheld on Tuesday, June 24, beginning at 4 p.m.
Council would decide to proceed or not at a meeting subsequent to the hearing.
That is a provincial requirement for cities looking to establish such corporate entities, as is disclosing the general business plan and organizational structure to residents. That and supporting documents are available on the city’s website.
The division’s own presentation to council last month stated that a municipally controlled corporation – coupled with a council-controlled rate review committee – could drive better financial results while keeping rates in check.
It would be better able to align huge capital requirements an streamline operations to compete on the Alberta export gird, they said.
The idea of a more professional, industry focused board to run the natural gas business or power plant arose more than 10 years ago, but was most recently a key recommendation of a third-party report on the business by consulting group, KPMG.
Former city councillor and energy committee chair Phil Turnbull has frequently argued that part-time elected council members are generally ill-suited to managing a valuable business in a complex sector.
He attended Friday and told the News that to keep the business healthy a business-first approach it needed but residents should have the protection of an apolitical rate review board that must be empowered to lower or raise rates if needed.
“The worry is that this MCC will be like (City of Calgary’s power corporation) Enmax, but the difference is that Enmax doesn’t come to city council rate review,” said Turnbull.
“It’s the one thing that makes ours different, and acceptable in my view, but you have to have quality people making decisions.”
Enmax, a corporation wholly owned by the City of Calgary to operated its former power business, and Epcor, in Edmonton, also operate outside their cities, and don’t hold marketing or supply franchises like Medicine Hat.
Keeping that local franchise area could be a key philosophical point in a shareholders agreement, Pancoast has said.
The Medicine Hat Utility Ratepayers Association was heavily represented among attendees. That group has lobbied for lower power and tax rates and against the construction for the Saamis Solar project. It released a list of 29 questions that it has for the city related to the creation and operations of the MCC.
“At the end of the day is an MCC going to be accountable to council or residents,” said MHURA president Sou Boss told the News. “Right now, the city is very mum on a lot of their projects, and it will be even more so.”
“They’re going private to make money, so how is that money going to be divided up?”
Staffers say that the division has provided $500 million in dividends over the last 20 years, but extremely low profits are expected until 2030 due to low power price forecasts.
The proposal outlines dividend policy of $7 million per year or 30 per cent of net income, whichever is greater.
The departments provided a $12 million dividend in 2024, following a $140-million transfer in 2023 when export profits set records.
Attendee Darlene Gray said that council is currently considering major issues with the energy division – such as proceeding with the solar facility and examining offers for the remaining gas well inventory – which should be done by a board with promised expertise.
On the other hand, the decision to create the new corporate structure would overlap with an election next fall and the incoming council may be in opposition.
“I don’t think they should be moving ahead,” she said.
