Review of deregulated electricity market now overdue

Delay blamed on MLA’s resignation

By Darcy Henton Calgary Herald May19, 2014

EDMONTON — A plan to educate consumers about the deregulated electricity market and to bolster the powers of the market watchdog is three weeks overdue and likely won’t be submitted to government until June, says the chairman of the committee of six Tory MLAs tasked with the job.

Everett McDonald, PC MLA for Grande Prairie-Smoky, said he now hopes to produce a report on the implementation of 33 recommendations to Energy Minister Diana McQueen June 1.

“Our team is just finishing the report,” McDonald said in an email. “We have one more review and will present to the minister.”

He said he is looking forward to completing the report after 65 meetings with stakeholders and residents

McDonald attributed the delay to the appointment and subsequent departure of an associate minister of electricity, Donna Kennedy-Glans, who resigned over her disenchantment with the party and crossed the floor to sit as an independent.

The committee was assigned May 1, 2013 to provide advice and support to the energy ministry regarding decisions required to implement the 33 recommendations from the blue-ribbon panel’s September 2012 Power For the People report.

It presented an interim report to former energy minister Ken Hughes last fall, but it was never released.

Alberta Energy spokesman Mike Feenstra said the minister is expecting the report soon.

“Our expectation is it will provide a path for us to implement the recommendations we accepted,” he said.

The issue dates back to spiking power prices on the eve of the 2012 election.

Premier Alison Redford diffused a potential election issue on Feb. 23, 2012 by announcing a four-point plan that addressed several growing areas of concerns.

She appointed to blue-ribbon panel of experts to review the variable rate option — the electricity price paid by Albertans who aren’t on fixed contracts — “to reduce volatility and costs.”

She also temporarily froze fees attached to power bills for transmission, distribution and administration charges, called on the Alberta Utilities Commission to find efficiencies with electricity distribution and amended regulations to reduce the deposits required from energy marketers in a bid to increase consumer options.

Since then, four different cabinet ministers have handled the file and electricity prices remain volatile with the regulated rate option jumping 40 per cent from April to May due to plant and transmission line maintenance.

Critics say they aren’t holding out a lot of hope the report will improve the plight of residential consumers.

“They’ve spent a lot of taxpayers dollars to produce a whole bunch of committees and a whole bunch of reports,” said Wildrose critic Joe Anglin. “This is indicative of the fact they don’t know what to do.”

He said report may be late but consumer electricity bills will arrive on time.

“It would not surprise me at all, their having not done anything since the last election … that what they will end up doing here is waiting for the next election and doing something silly again, whatever they have to do to get elected,” Anglin said. “That’s not how you manage a market-based electricity system.”

NDP MLA David Eggen said Albertans are increasingly demanding an explanation for why their electricity bills are so high and he hopes the report will provide some answers.

“We need to have a plan of action to protect Albertans who are right now paying some of the highest monthly rates in North America for residential and commercial power,” he said. “Let’s make it crystal clear why that is, then we can start to solve the problem, because it’s outrageous that we have to pay such high power bills in this province.”

Alberta Consumers Coalition spokesman Jim Wachowich said the plan to create a retail market for electricity in Alberta has been a failure and he is not optimistic a committee of Tory MLAs can fix it.

“This whole process of trying to re-design the utility marketplace has been a very, very flawed process,” he said. “It is our belief that we have just paid a whole lot of money into a conceptual re-design that hasn’t delivered the benefits and probably is not going to deliver benefits that outweigh the costs.”