The provincial government introduced An Act to Cap Regulated Electricity Rates, or Bill 16, on Tuesday. It would see Alberta’s Regulated Rate Option not surpass 6.8 cents per kilowatt hour for the next four years, if passed.
“With this bill, we’re following through on the promise we made last fall to protect Albertans from electricity price spikes. Volatility and uncertainty have been hallmarks of our electricity system for years. Electricity is a basic necessity and Albertans shouldn’t have to worry about their power bills spiking from one month to the next. This cap would help make life more affordable by ensuring Albertans aren’t burdened with price volatility as we transition to a cleaner electricity grid and a more stable electricity market,” said Marg McCuaig-Boyd, Minister of Energy.
If the proposed legislation gets passed, it will go into effect June 1 of this year, and remain in effect until May 31, 2021.
Rates have been as high as 15.3 cents and as low as 2.7 cents over the last half dozen years.
Current rates in Alberta are around three cents province-wide.
“When we came up with this price cap, we talked to industry and providers, and looked at where we’ve been and where we’re going… we’ve got quite a bit of room under the 6.8 [cents] right now,” McCuaig-Boyd stated during a teleconference on Tuesday.
She adds they have taken necessary steps to avoid any type of situation like the current electricity rate problems they are experiencing in Ontario.
“We’re doing ours by a series of auctions,” she said. “The reason it’s the four years is that’s while we’re designing the capacity market. This helps build a bridge to that market, and it’s one of the pieces, of several, as we transition to 30 per cent [renewable energy] by 2030.”