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Medicine Hat now covered under province-wide electricity price cap

Dec 19, 2017 | 9:13 AM

 

MEDICINE HAT, AB — The Alberta government has announced Medicine Hat is now under the province-wide electricity price cap.

According to a news release on Tuesday, Medicine Hat power customers will not pay more than 6.8 cents per kilowatt hour from January 2018 to May 2021. This is the same protection offered to Alberta families, farms and small businesses on the regulated rate option.

The option is part of The Act to Cap Regulated Electricity Rates, which took effect in June.

“When we introduced our power price ceiling, we said we’d work with Medicine Hat to offer the same protection that benefits the majority of Albertans,” said Margaret McCuaig-Boyd, Minister of Energy, in a news release. “We’re now proudly delivering on that promise, so that even when rates are low, families won’t have to worry about bills spiking from one month to the next. I want to thank the city for being a great partner in helping us make life better and more affordable for all Albertans.”

The regulated rate option introduced did not apply to Medicine Hat consumers because the city owns and operates its own power utilities. The province and the city worked to develop a regulation for electricity prices in Medicine Hat to keep prices stable and affordable.

“We thank the government for recognizing the city’s unique position as the only municipality in Alberta to own its own utilities,” said Mayor Ted Clugston in a news release. “Our monthly power prices are based on the average electricity charges across Alberta, ensuring that our customers benefit from consistently low utility rates.

“This agreement enables us to continue providing strong advantages of low utility rates, high-quality services and innovative energy management to Medicine Hat residents and businesses.”

Clugston adds it was important that the city of Medicine Hat be covered under the new cap.

“We wanted to make sure that, if you were going to treat citizens in Calgary a certain way, taking carbon tax money and give it back to them, we wanted to make sure that the same thing happened here,” he said. “Because, of course our citizens are paying in, and we want to make sure it’s fair.”

If there are any overages, the difference would be paid to the rate provider with money from the carbon tax.

In the new year, rates will be based on the average of four energy providers approved by the Alberta Utilities Commission.

During the period the price ceiling is in effect, consumers on the Regulated Rate Option and Medicine Hat’s default rate will pay the lower of the market rate or the government’s rate of 6.8 cents per kilowatt hour.

The government is working to keep rates below 6.8 cents in a variety of ways, including the transition to a more stable and predictable capacity electricity market, a news release stated.. Should rates rise above 6.8 cents, the rate cap would be automatically applied to the bills of consumers on the regulated or default rate.

Electricity rates for the month of December in Medicine Hat are set at 3.94 cents per kilowatt hour, up from 3.55 cents in November.