NL Consumer Advocate says 18% electricity rate hike 'unacceptable'

Newfoundland Consumer Advocate

subscribe

St. Johns -

How much of a rate hike is reasonable for users of electricity in Newfoundland and Labrador?

That's a question before the Public Utilities Board (PUB) as it examines an application by Newfoundland and Labrador Hydro, which could see consumers pay up to 18.6 per cent more as of July 1.

"The estimated rate increase for July 2017 is such a significant increase that it may be argued that it would cause rate shock," said the PUB, asking the company to revise its application.

NL Hydro said the price adjustment is part of what happens every year through the Rate Stabilization Plan (RSP), which is used to offset the ups and downs of oil prices.

"The cost of fuel is volatile and as long as we rely on oil-fired generation at Holyrood, customers will continue to be impacted by this electricity price uncertainty," said the company in a statement to CBC News.

It noted that customers received a break from RSP adjustments in 2015 and 2016.

The PUB noted that under the rate stabilization plan, prices have gone up or down by about 10 per cent in the past.

The regulatory board said the impact of the latest request would be a 27.6 per cent hike to Newfoundland Power, with "an estimated average end customer impact of 18.6 per cent."

Hydro's estimates are based on an average price for oil of $81.40 per barrel from July 2017 to June 2018, according to the PUB.

 

'Unacceptable' burden: Consumer Advocate

"To burden ratepayers with an 18 per cent rate increase is unacceptable," said Consumer Advocate Dennis Browne.

Browne is arguing that there is money in the RSP to reduce the proposed increase.

"These ratepayer balances — which, according to NL Power, totals $77.4 million — are not the property of Hydro," he wrote in a letter to the PUB.

"No utility has the right to squirrel away ratepayers' money to be used by that utility for some future purpose. The Board has jurisdiction over those balances," Browne said.

Browne also wants the RSP overhauled so that it can be applied to price fluctuations every quarter, as opposed to annually.

Hydro has expressed concern that depleting the rate stabilization fund would lead to other, more significant, rate increases in the future.

It said several alternatives to mitigate high rates have been provided to the PUB, which has final say.

Related News

edmonton electrical solar panels

Solar farm the size of 313 football fields to be built at Edmonton airport

EDMONTON - A European-based company is proposing to build a solar farm bigger than 300 CFL football fields at Edmonton's international airport.

Edmonton International Airport and Alpin Sun are working on an agreement that will see the company develop Airport City Solar, a 627-acre, 120-megawatt solar farm on what is now a canola field on the west side of the airport lands.

The solar farm will be the largest at an airport anywhere in the world, EIA said in a news release Tuesday.

"It's a great opportunity to drive economic development as well as be better for the environment," Myron Keehn,…

READ MORE
kenya nuclear program

Kenya on Course for $5 Billion Nuclear Plant to Power Industry

READ MORE

transalta-poised-to-finalize-alberta-data-centre-agreement-in-2025

TransAlta Poised to Finalize Alberta Data Centre Agreement in 2025 

READ MORE

uk-ev-drivers-demand-fairer-vehicle-taxes

UK EV Drivers Demand Fairer Vehicle Taxes

READ MORE

ev building charging

How vehicle-to-building charging can save costs, reduce GHGs and help balance the grid: study

READ MORE