Albertans brace for high August electricity bills

The rising temperatures are no match for the sky-high electricity rates. The hotter it gets, the higher the demand for power. Albertans part of the Regulated Rate Option (RRO) will see their August bills hit an uncomfortable record.

RRO plans like Enmax and the City of Lethbridge, are set to increase from 16 per cent to 22 per cent to an average of 32.267 cents per kilowatt hour.

Joel MacDonald, economist and co-founder of Energyrates.ca, explains the reasons for the rate hike are layered but he’s narrowing in on one.

“With climate change, we’ve seen a lot of people in the summer start to purchase and use air conditioners,” said MacDonald.

Cooling off comes at a cost for about a third of Albertans who are currently on the RRO.

Trevor Lewington, business development with Ridge Utilities, said there is a way to avoid the hiked price.

“The easiest and fastest thing people can do is get off the RRO,” said Lewington.

The RRO is the default energy option. The other options are floating and fixed rates.

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With the large fluctuations in rates over the last few years, Ridge is trying to get customers to make the switch.

Macdonald with Energyrates.ca explains in Alberta, you can enter and exit a contract anytime with no fee, but it does take a credit check or a deposit of an approximate $400 to $500 to transition to a fixed-rate plan.

“Right now, the way the marketplace is structured, we don’t see a good solution for those that can’t pass a credit check, unfortunately,” said Macdonald.

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Minister of Affordability and Utilities, Nathan Nuedorf said in a statement to Global News, “Our government shares Albertans’ concerns about high electricity prices. In addition to the relief measures provided this past winter, we are working with industry and stakeholders to review the RRO and identify longer-term solutions throughout the electricity system to keep electricity affordable.

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“This is a key part of my mandate from the premier and is a top priority for me. We’re focused on a more competitive system and the ways to reduce and manage future costs, including phasing out the regulated rate option.”

Long-term, Lewington suggests Alberta will need to offset growing demand by expanding sources like wind, gas and solar.

“The more generation stability we have, the more stable prices will be.”