Posted on Mar 1, 2017
Breaking down the carbon levy on your bills
By Bruce Hinkley, MLA for Wetaskiwin-Camrose.
Here is a brief backgrounder about the carbon levy, natural gas and electricity bills. I have received replies from Direct Energy, the Utilities Consumer Advocate and constituents about rising utility bills.
The carbon levy is only a small part of your heating cost increase.
On your natural gas bill the carbon levy is only one component of your overall price. As it is based on the ‘amount’ of natural gas consumed, it will increase during the winter and decrease considerably in warmer months. For 60% of Alberta households, carbon rebates are intended to cover a typical Albertans’ carbon levy costs. This is based on income. Some Albertans will receive partial coverage. The carbon levy still provides incentive to reduce consumption - if you reduce your consumption, you will save more of your rebates and can come out ahead, with additional money in your pocket. In addition to rebates, the carbon levy is funding energy saving efficiency programs that will help Albertans to reduce their energy consumption, allowing them to save even more on energy costs.
The carbon levy is only a small part of your heating cost increase. Enmax said, on Monday, Feb. 13th: "about 80% of the increase in bills can be directly attributed to the extended and extremely cold temperatures we experience this winter." Especially compared to our very mild November.
Higher transmission charges in recent months are likely a result of households’ increased gas consumption. Transmission charges are variable, meaning they are based on your varying consumption. Higher distribution charges are a results of continuous investment and improvements in the distribution systems that bring gas to your homes and businesses.
Complaints about distribution and transmission charges can be directed to the Utilities Consumer Advocate: 1-866-744-5129.
Rate Rider X (for Direct Energy PRO customers) is being used by Direct Energy to recover the costs of their settlement and litigation fees resulting from settling a class action suit with customers over late fee billing practices. This was not a rider from the government and is not related to government policy. Concerns and complaints can be directed to Direct Energy at: directenergy.com/alberta; the Alberta Utilities Commission at: auc.ab.ca and the Utilities Consumer Advocate at: ucahelp.alberta.ca.
Despite what some have suggested, there is ‘no’ carbon levy on electricity bills. The carbon levy is not affecting electricity bills.
With regard to your electricity bills we have given the Balancing Pool the tools it needs to manage expenses. This is protecting consumers by limiting a charge that could have been $13/MWh to $1.11/MWh. For a typical residential consumer, that charge could have been $8 per month, but instead will be 67 cents per month. For a 50 megawatt oil and gas facility, for example, the cost would have been around $300,000 a month if our government had not taken action. By giving the Balancing Pool the tools it needs to smooth out the cost, that cost is about $24,000 - a difference of over a quarter million dollars every month.
Our government will continue to work with the Balancing Pool to understand what additional steps the Balancing Pool can take to further reduce the cost impact on consumers.
We announced a 6.8 cent per kWh price ceiling on the regulated rate option for electricity, that will take effect June 1, 2017.
The electricity system we inherited is exceptionally volatile. Volatility was built into the design of this system. While we transition to a more stable electricity system through the adoption of a capacity market, we are protecting consumers against the sort of unexpected and unpredictable price spikes that have happened in the past.
You may have also heard in the news that two additional medical examiners have been added to the Office of the Chief Medical Examiner to strengthen service to Albertans by increasing the speed of death investigations, and allow families to receive important information about their loved one. This brings the number of medical examiners to ten. The two additional positions will help complete the 20,000 death investigations, including 4,000 autopsies performed every year in Alberta.
Good news for the economic development of Wetaskiwin and the general diversification of our economy was the recent signing of a "letter of intent" between J + H Aviation of Wetaskiwin with Shengda Xiang Yun Aviation of Yongcheng, Henan Province China. The $200 million dollar start up project will utilize aircraft parts made in China then brought to Wetaskiwin where they will be assembled into 8-seater small aircraft to be sold throughout North America. This will require jobs for construction and once finished ongoing jobs in the assembly plant. Congratulations John Jefferies and Hong Fang Zhang for their efforts over the past two years to foster this international trade.
First published in the Wetaskiwin Times Advertiser, March 1, 2017.