Staff are recommending the city take steps towards an arms-length energy business and a rate-setting committee. Eli J. Ridder/CHAT News

By Eli J. Ridder

CITY HALL

Medicine Hat city staff back creating arms-length energy corporation, rates committee

Dec 5, 2024 | 10:16 AM

Medicine Hat staff are recommending the city develop a plan to establish an arms-length energy business corporation and take steps to create a utility rates review committee, in support of the suggestions made through a third-party review.

Staff will also revisit its current state natural gas production business plan with an aim to further minimize losses and optimize value, and if appropriate, to accelerate retirement or sale of its natural gas assets, as proposed in the audit.

KPMG, who conducted a $590,000 third-party review requested by city council in 2023, proposed Medicine Hat spin off its electricity and natural gas businesses into a municipally-controlled corporation similar to EPCOR Utilities in Edmonton or ENMAX in Calgary.

The city would own 100 per cent of the shares of the MCC and appoint its board of directors, which in turn would make energy business decisions separate from council.

The proposed city committee would be charged with setting the rates that appear on resident utility bills.

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Staff in a report coming forward at a special meeting say council should create a pair of implementation plans that will get the ball rolling on the two proposals.

City council had asked staff for their take on the KPMG report when it was first presented at a meeting on Nov. 25.

Councillors wanted to move quickly on next steps after receiving the report and asked staff to return by Dec. 9.

Council will hear and deliberate on the staff recommendations during a special council meeting that gets underway at 4 p.m.

Rochelle Pancoast, the city’s managing director of land, energy and the environment, was supportive of council’s enthusiasm to get the debate started.

“Council is recently informed, recently heard directly from KPMG so in my personal view, there is value in understanding and considering all of those options while it is fresh and current informationn,” Pancoast told CHAT News on Wednesday.

Several councillors say that public feedback is an important part of considerations, as well.

Pancoast, the energy department’s top staffer, said she is mindful of that element as well.

“We haven’t yet determined what that will look like,” she said.

“It’s not always easy when we are talking about very complex topics and understanding what is most important to the community is helpful and how we proceed in what engagement looks like.”