Calgary Electricity Price Increase signals higher ENMAX bills as grid demand surges; wholesale market volatility, fixed vs floating rates, kWh costs, and transmission charges drive above-average pricing across Alberta this winter.
Key Points
A market-led rise in Calgary power rates as grid demand and wholesale volatility affect fixed and floating plans.
✅ ENMAX warns of higher winter prices amid record grid demand
✅ Fixed rates hedge wholesale volatility; floating tracks spot market
✅ Transmission and distribution fees rise 5-10 percent annually
Calgarians should expect to be charged more for their electricity bills amid significant demand on the grid and a transition to above-average rates across Alberta.
ENMAX, one of the most-used electricity providers in the city, has sent an email to customers notifying them of higher prices for the rest of the winter months.
“Although fluctuations in electricity market prices are normal, we have seen a general trend of increasing rates over time,” the email to customers read.
“The price volatility we are forecasting is due to market factors beyond a single energy provider, including but not limited to expectations for a colder-than-normal winter and changes in electricity supply and demand in Alberta’s wholesale market. ”
Earlier this month, the province set a record for electricity usage during a bitterly cold stretch of weather.
According to energy comparison website energyrates.ca, Alberta’s energy prices have increased by 34 per cent between November 2020 and 2021.
“One of the reasons that this increase seems so significant is we’re actually coming off of a low period in the market,” the site’s founder Joel MacDonald told Global News. “You’re seeing rates well below average transitioning to well above average.”
According to ENMAX’s rate in January, the price of electricity currently sits at 15.9 cents per kilowatt-hour, with an electricity price spike from 7.9 cents per kilowatt-hour last year.
MacDonald said prices for electricity have been relatively low since 2018 but a swing in the price of oil has created more activity in the province’s industrial sector, and in turn more demand on the power grid.
According to MacDonald, the price increase can also be attributed to the removal of a consumer price cap that limited regulated rates to 6.8 cents per kilowatt-hour for households and small businesses with lower demand, which, after the carbon tax was repealed, initially remained in place.
Although the cap was scrapped by the UCP three years ago, he said energy bills now depend on the rate set by the market.
“What’s increased now recently is actually the price per kilowatt, and the (transmission and distribution) charges have only increased, but annually they increase between five and 10 per cent,” MacDonald said. “So the portion of your bill that’s increasing is different than what Albertans are typically used to, or at least in recent memory.”
But Albertans do have options, MacDonald said.
As part of its email to customers, ENMAX sent a list of energy saving tips to reduce energy consumption in people’s homes, including using cold water for laundry and avoiding dryer use, energy-efficient lightbulbs and unplugging electronics when they are not in use.
Retailers also offer contracts with floating or fixed rates for consumers.
“Fixed rates, obviously, you’re going to pick your price. It’s going to be the same each and every single month,” MacDonald said. “Floating rate is based off the wholesale spot market, and that has been exceptionally high the last few months.”
He said consumers looking to save money when electricity prices are high should look into a fixed rate.
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