"The impact is going to be in a number of communities -- not necessarily all -- but the rates are going to go up because the customer base is not absorbing the capital cost," says Bill Braden, director of corporate development for the NWT Power Corporation.

But the costs will not go up immediately, he says. That won't happen until community consultations take place and a process for implementation and review is decided upon.

"Now at last we have a decision on how to structure rates for the long-term," says Braden.

The movement toward community cost-based structure has been under way for years. It was first raised as an issue in 1990.

And government won't be subsidizing other users to the extent it has in the past, thanks to the elimination of separate government and non-government categories in domestic and commercial rates classes by April 2002.

"Through rate rebalancing over the next four years, we'll be shaving the peaks where government has been paying too much and bringing up the valleys," Braden says.

Rate rebalancing also involves adjusting rates between customer categories to a target range of between 95 per cent and 105 per cent of the cost of providing services for all customers.

Public Utilities Board chair John Hill says he can't comment on the rationale for the rates once a decision has been rendered.

But in the board's written decision dated June 16, 1997, the PUB states several reasons -- the main one being fairness to the customer.

"While the prospect of significant future capital costs may present a problem for some of the smaller communities, the board is not convinced that the individual communities and NWTPC have done everything within their power to defer or reduce the level of the necessary investments," it said.

Power Corporation president Leon Courneya says the decision means communities will be even more accountable to the ratepayer for long-term costs and reliability of the power supply.

The board did not approve the corporation's proposal to group the 44 diesel-generation communities it serves into five eastern and five western zones.

The general rate application covers the period April 1, 1995 to March 31, 1998 inclusive.