MONCTON – A new report published by NB Power says general service customers, including businesses, schools and hospitals, are paying more for their electricity than residential customers.
According to the company’s projections for 2015-16, residential customers will underpay the utility by $45.2 million — receiving $736.7 million worth of service for $691.5 million — meaning that for each dollar it spends to produce the electricity, residential customers pay 94 cents.
Meanwhile, general services customers are projected to pay $199.9 million for $168.1 million of service, or $1.19 for each dollar.
New Brunswick’s Energy and Utilities Board (EUB) requested the study earlier this year as part of its new responsibilities setting the rates for NB Power next year.
The EUB has had a long standing policy that no rate class should subsidize another rate class, but it considers a difference between $0.95 and $1.05 between the rate classes to be an acceptable range.
This could mean rate increases from one cent to 11 cents for homeowners and a decrease of 14 to 24 cents for general service customers.
The change from legislated rate increases to those decided by the EUB also means that variable rate increases are possible.
For David Shin, the owner of C’est La Vie Cafe on Main street in Moncton, it’s good news.
“It helps,” he said. “Business managing is not easy because of the global recession. Even downtown, it’s hard to manage.”
Shin has owned the cafe for two years. He says he pays about $600 a month for electricity and it’s one of his main expenses.
People walking nearby outside the cafe were not excited about the prospect of a rate hike.
According to the study, small industrial customers will also overpay — $1.07 for each dollar — while large industrial will receive a slightly subsidized rate of 99 cents.
NB Power is waiting for the EUB to approve the methodology for the report. It will be included as part of the evidence in the public hearings in the spring to decide new rates.
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