The decrease, which was announced in the GNWT’s response to both the electricity review and Northwest Territories Power Corporation (NTPC) review, will be implemented by the fall without raising rates in other communities, Industry, Tourism and Investment Minister Bob McLeod said.
“We expect it will have a positive impact on the communities, expect that it will make communities a more attractive place to live, reduce the cost of living,” he said. “It will allow them to become more diversified, hopefully attract more business investment.”
The new system will be in place for NTPC communities by Oct. 1. The GNWT will also work with Northland Utilities to develop an approach for NUL communities.
Under the plan, titled “Efficient, Affordable and Equitable: Creating a Brighter Future for the Northwest Territories Electricity System,” the NWT’s 33 current community electricity rate zones will be reduced to seven: the NTPC thermal zone, which includes the communities of Colville Lake, Nahanni Butte, Sachs Harbour, Jean Marie River, Gameti, Paulatuk, Wrigley, Tsiigehtchic, Tulita, WhaTi, Deline, Lutsel K’e, Fort McPherson, Ulukhaktok, Fort Good Hope, Tuktoyaktuk, Fort Liard, Fort Simpson, Aklavik and Inuvik; the NTPC Norman Wells zone; the NTPC Taltson zone, which includes Fort Smith and Fort Resolution; the NTPC Snare zone, which includes Dettah and Behchoko; the NUL thermal zone, which includes Fort Providence, Dory Point, Kakisa, Wekweeti and Trout Lake; the NUL hydro zone, which includes Hay River, the Hay River Reserve and Enterprise; and the NUL Yellowknife zone.
While the changes will shift approximately $4 million in costs from the thermal communities to the hydro communities, the increased cost will be offset by the GNWT’s decision to pay down the existing $6 million Northwest Territories Power Corporation rate rider balance and forgo the $3.5 million NTPC dividend for the next two years. The rate riders will be removed from electricity bills beginning on Oct. 1. The transitional support will mean that existing electricity rates will not increase before 2012-13.
The Territorial Power Subsidy Program (TPSP) will also be modified. Under the current system, residents of communities with power rates higher than Yellowknife’s pay the same rate as Yellowknife residents for their first 700 kilowatt hours per month. Under the new plan, the threshold will be increased to 1,000 kilowatt hours between September and March and 600 kilowatt hours for the remainder of the year. On April 1, 2011 the GNWT will introduce a new energy conservation program to replace the current commercial component of the TPSP.
Under the plan, residents in Nahanni Butte will see their electricity rate drop from 166.40 cents per kilowatt hour to 49 cents per kilowatt hour – a decrease of nearly 71 per cent. Commercial customers in thermal communities will also see a significant decrease of between 28 and 80 per cent. The general store in Nahanni Butte, which currently pays $100,000 annually for electricity, will see its rate drop from 214.65 cents per kilowatt hour to 42 cents per kilowatt hour, McLeod said.
“With this change they’ll be paying $20,000 to $25,000 per year,” he explained.
Hay River Mayor Kelly Schofield said he would have liked more consultation between the GNWT and municipal governments on the proposed changes.
“They didn’t come and consult with us, there was no information,” he said Saturday. “All of a sudden, bam, it’s done. We feel there should have been a consultation process or at least an information process to let us know what’s going on, rather than just plop it on our laps.”
The GNWT will also revamp the Public Utilities Act by April 1. The new act will better define the government’s authority to issue policy direction to the PUB; provide the PUB with more flexibility in establishing rates; introduce standardized filing requirements for general rate applications;
Current NTPC franchises will be grandfathered while legislation will give the Corporation the first right of refusal on future electricity power generation and distribution projects. NUL will retain the rights to its current franchises.
The GNWT will also direct NTPC to modify its communication strategy; pursue energy conservation and promotion; become more active in the planning and implementation of alternative energy projects; and work to improve its relationships with major customers.
An energy plan was released in March 2007, and concluded that all communities should have access to affordable and reliable electricity.
The GNWT agreed to form a panel to examine ways to reduce costs through a review of electricity rates and regulations in the NWT. The review team, which was appointed in December 2008, visited eight communities to discuss ways to improve the current system. They also met with representatives from the more remote communities through a workshop organized by the Northwest Territories Association of Communities. The panel’s summary of what they heard, “Electricity Review: A Discussion with Northerners About Electricity,” was released in June 2009. The panel’s final report, “Creating a Brighter Future: A Review of Electricity Regulation, Rates and Subsidy Programs in the Northwest Territories,” was tabled in the legislative assembly in November.