Alberta : Making electricity more affordable

The Voice of Chandigarh News:

Alberta’s government is making electricity more affordable by protecting Albertans from spikes in prices and helping them be more informed about their options.

To protect Albertans on the default electricity rate from sudden spikes in prices, Alberta’s government intends to introduce legislation and new regulations this spring to make electricity more affordable by reducing volatility and increasing competition in the electricity market. Default electricity rates will be stabilized by being set for each provider every two years. This will significantly reduce spikes in prices for Albertans unable to sign a competitive contract, including rural Albertans who may not have other options available, and those who have poor credit or other financial difficulties such as seniors and other vulnerable populations.

“Albertans should not dread opening their bill each month. Unpredictable power costs make it hard for families to plan their household budgets and we simply cannot allow confusion about electricity billing to cause Albertans financial hardship. We promised we would address rising unaffordability in utility bills and we’re taking the first steps to do just that, with more to come.”–Danielle Smith, Premier of Alberta

The default electricity rate’s name, Regulated Rate Option (RRO), is misleading as the term ‘regulated’ is confusing to consumers and gives them a false sense of protection that the rate is protected by the government. Based on recommendations from the RRO Working Group, Alberta’s government intends to introduce legislation this spring to rename the default electricity rate to the Rate of Last Resort. By changing the name to the Rate of Last Resort, consumers will be able to better understand the rate they are paying and encourage them to find the best option for them.

“Knowledge is power, and Albertans need to know their options. Utility bills can make or break a tight budget where every penny counts, which is why we’re protecting those with limited options from sudden spikes in electricity prices. This will also make life more affordable for all Albertans as it puts downward pressure the price of utilities.”Nathan Neudorf, Minister of Affordability and Utilities

When a consumer chooses not to sign a competitive contract, they automatically must purchase their electricity at the default rate from their local default provider. To further ensure that Albertans are better informed about their electricity rate options, Alberta’s government intends to introduce additional requirements for default utilities providers. Within 90 days of providing their services, providers will be required to confirm with their customer whether they’re choosing to sign a competitive rate contract or to stay on the default electricity rate. Providers will also be required to share information with their customers on how to access the Utilities Consumer Advocate’s resources. Additionally, the government will be requiring providers to remind them of their options on their monthly bills.

“Consumers benefit when they better understand the products and services they are purchasing. Proposed changes would provide more clarity to electricity consumers and will encourage them to explore their retail energy options to find the services that best meet their household’s or business’ needs.”Chris Hunt, Utilities Consumer Advocate

Alberta’s competitive retail electricity market gives Albertans the choice of over 50 competitive price retailers that provide fixed and variable rate contracts. Tens of thousands of Albertans moved off the default rate in 2023, and those still on the rate should consider their options. Those who are looking for assistance with their utility bills or are experiencing a dispute with their provider should contact the Utilities Consumer Advocate.

“Not only does Alberta’s unique, deregulated electricity market attract investment and help grow our economy, but it gives Albertans the power to choose the best energy providers, plans, and payment options to fit their needs. By encouraging competition, these policies will help make utility bills more affordable.”Chantelle de Jonge, Parliamentary Secretary, Affordability and Utilities

Quick facts

• Albertans have three options when purchasing their electricity and natural gas utilities; the default RRO, a competitive contract for a variable (floating) rate, or a competitive contract for a fixed rate.
  • For more information about utility rates, contact the Utilities Consumer Advocate or visit their website.
  • In Alberta, customers who don’t sign a competitive contract will receive the default electricity rate from their local RRO provider.
  • Default electricity rates currently fluctuate month-to-month based on market prices for electricity in Alberta. These rates are set by the Alberta Utilities Commission (AUC), and are not determined by the government.
• Approximately 29 per cent of residential customers purchase electricity through the default electricity rate.
• Approximately 32 percent of eligible commercial customers and 46 per cent of farm customers purchase electricity through the default electricity rate.