Report recommends restructured rates
Richard Gleeson
Northern News Services
Yellowknife (Dec 11/00) - Some communities may pay more for power and others less if a recommended restructuring of power rates is approved.
A report on power generation and distribution in the NWT released last week recommends creation of two rate zones: one rate for communities using hydro power and another for those using 'other' sources of power.
FMBS chair Lou Voytilla said the two new rates would be calculated by dividing the total cost of service in each zone by the level of consumption for that zone.
Those calculations identify the cost of service in Yellowknife as the going rate for hydro communities and Inuvik as the standard for those not using hydro.
Communities paying the highest rates in each group will pay less under the proposed new format; those paying the lowest rates would pay more.
The proposed rate structure would result in the politically awkward situation of small communities like Fort Smith and Fort Resolution effectively subsidizing power rates in Yellowknife.
The switch in rate structures was recommended as a way of eliminating the expense and time it takes to calculate cost of service rates for each community.
Discussion of power rates in the North is complicated by a government subsidy program that offsets the differences in rates from community to community.
Under the program, all residential and small business users paid the cost of power in Yellowknife for the first 700 kilowatts each month. After that they paid the actual cost of service. Average household consumption in the NWT is about 950 kilowatts per month.
If recommended changes are implemented, hydro communities would pay the Yellowknife rate regardless of consumption, said Voytilla. Those on other sources of energy would pay the Yellowknife rate for the first 700 kilowatts and the 'other' (Inuvik) rate for the next 300.
Beyond 1000 kilowatt hours, the rate would go up again.
