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Power rates set to rise

Jason Unrau
Northern News Services
Monday, May 14, 2007

YELLOWKNIFE - The Northwest Territories Power Corporation has proposed a 12 per cent interim electricity price increase approved last December would become permanent and could even increase by an additional two per cent.

In the general rate application before the Public Utilities Board (PUB), NTPC says it needed to make $79.9 million for 2006/2007 and will need $84.3 million next year - up from the $65.5 million it has been operating with since 2002/2003.

That was the last time the power corporation received approval for a revenue adjustment.

A 60 per cent increase in diesel prices since 2001, difficulties retaining employees in a tight labour market, federal changes affecting NTPCís pension fund and overall inflation make the general rate application necessary, according to the power corporation.

If approved, the second phase will determine how this additional revenue will be collected, which will likely entail an increase in electricity prices. Already, an interim rate rider has increased the price of electricity in Yellowknife to 20.91 cents a kilowatt-hour from 18.22 cents.

Though NTPC bases its rates on the cost of providing services in each community, most rely on relatively expensive diesel-generated electricity. The $10 million territorial support program, augmented by $3.5 million in NTPC dividends, means all customersí rates are subsidized to Yellowknife levels.

NWT residents are subsidized up to the first 700 kilowatts used per month. Commercial customers are subsidized for up to 1,000 kilowatts per month.

Because of this subsidy, both the mayor and Yellowknife Chamber of Commerce President Jim Eriksen said the rate increase only helps NTPC maintain its profit margin on the backs of hydro communities like Yellowknife which are far cheaper to supply with power.

Public hearings for the Phase one application will be held May 23-25 at the Baker Centre, starting at 9 a.m.