Home page

Text size

E-mail this page

SOMBA K'E/YELLOWKNIFE
Power bill hikes in Yellowknife will be a little less painful thanks to intervention from the city on Northland Utilities' request to increase power rates by six per cent over three years.

Claiming in a Yellowknifer ad Sept. 2 that Northland's original offer July 29 was "take it or leave it," the Public Utilities Board was prepared to launch a potentially expensive public hearing to settle a dispute between the city and the utility company over how high the hike ought to be.

The board approved a settlement Aug. 26 that Northland estimates will see power bills rise 3.5 per cent over three years, starting with 1.8 this year.

"It's going to be very reasonable, for sure," said Duane Morgan, Yellowknife manager for Northland Utilities.

Applied to the current power rate - 19.1 cents per kiloWatt/h - the 2011 rate is expected to increase to 19.4 cents per kWh.

He said the next phase of this application, which the Public Utilities Act requires the utility to file every three years, will finalize the new rates - a decision ultimately made by the Public Utilities Board. Morgan hopes that will be done by the end of the year or early next year, and an interim rate will come into play to collect the money the utility would have earned had the rates been set at July of this year. He said the increase will be fairly small.

"It just keeps us current," said Morgan, of the need for rate increases. "It creates some certainty."

He said the rate increases for 2012 and 2013 will be around 1.2 per cent and 0.5 per cent, respectively, totaling 3.5 per cent over three years.

Increases to the commercial rate - currently 14.7 cents per kWh - will be the same.

Morgan said he is happy with the settlement, as it would ultimately save the company money it would have spent on legal fees.

"We're hoping that overall there's going to be some savings through time and resources (that would be) spent on a full-blown hearing," said Morgan.

The city estimates it saved between $9,000 and $11,000 in legal fees by settling the matter ahead of a hearing, said Carl Bird, the city's director of corporate services.

Bird said the final amount of money the city spent pursuing the intervention might not be known until the second phase of the application, as the city will probably act as an intervener in that phase as well.

He said this is the second time the city, which always intervenes in power rate applications - and historically has been the only party to do so - has reached a settlement with with the utility and avoided a hearing.

"The city has a policy of acting as an intervenor in those rate applications, so we can look out and protect the interests of residents of Yellowknife on those applications," said Bird.

Utility board chair Joe Acorn defined revenue requirements by the utility as "how much money does the utility need to recover from the customers to fulfill its duty to provide energy safely and consistently."

He agreed a settlement is much cheaper for both the city and the utility, adding they "got partway through the process and realized their positions weren't too far apart."

In terms of required revenue, the final negotiated required revenue increases were $692,000 in 2011, $194,000 less than what was originally asked for; $1,142,000 in 2012, $236,000 less than originally asked for; and $1,356,000 in 2013, $267,000 less than originally asked for.

We welcome your opinions. Click here to e-mail a letter to the editor.