June 25, 2014 5:05 pm

Province approves SaskEnergy rate hike

The province has approved SaskEnergy's application to increase its commodity rate 26.7 per cent.

File / Global News

REGINA – Saskatchewan residents will be paying more for natural gas.

The province has approved SaskEnergy’s application to increase its commodity rate 26.7 per cent to $4.84 per gigajoule from $3.82 per gigajoule. That means an extra $9.57 a month for the average residential customer.

“I think it’s important to remember here though, this is the first increase in six years and in that past six years there’s actually been four decreases,” Jim Reiter, minister responsible for SaskEnergy, said Wednesday at the legislature.

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“This is just a case of the market: that’s what the cost is for market; that’s what flows through to the customer.”

The delivery rate, the charge for getting natural gas to customers, is not changing. The delivery rate and commodity rate each account for about half of a bill.

SaskEnergy said it needed to raise rates because of increased demand due to an extremely cold winter.

“It was a long cold winter and that had a big impact, certainly not just in Saskatchewan (but) right across the country,” said Reiter.

“I looked to our neighbours to the west in Alberta, where they adjust monthly, and at a time that we were paying $3.80 a gigajoule, at times Calgary and Edmonton were paying in the neighbourhood of $9. Certainly, the market for natural gas can fluctuate quite a bit and I think this shows that.”

The rate hike kicks in Tuesday. Reiter said the adjustment gives customers time to prepare for higher consumption months that start in the fall.

© The Canadian Press, 2014

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