Not many communities can still say they own their power, but Ponoka has held on to the asset.
“We’re the wire owner. We run the electricity to people consuming it,” said Betty Quinlan, Director of Corporate Services, at a council meeting Nov. 12.
The new council met with Kevin Phillips, a consultant who has expertise in the power industry and has been working with the Town of Ponoka for some time, and learned about how Ponoka sits with the rest of the province.
“Ponoka was embedded within the Fortis distribution system,” explained Phillips.
Although the industry is deregulated, there are many requirements companies must adhere to. In recent years, the Town of Ponoka has undertaken a series of upgrades to ensure the electricity infrastructure is up to date. And while it may be a large source of income for the town, maintaining equipment is just as important.
“That’s going to keep you in good standing for years to come,” offered Phillips.
Power rates are on an upward climb, however, he explained. The industry has had to ensure its infrastructure is upgraded to meet the demands of Alberta’s transmission policy in Bill 50.
One of the requirements was that there should be no bottlenecks in the system, said Phillips. To do that, $30 billion in construction and maintenance has been planned for in the next 10 years. This requirement is intended to meet enhanced residential and industrial needs such as those of large oilfield operations.
“There was major capacity in the transmission system to handle the power,” said Phillips.
“It’s the economic development driver in the province,” he added.
While Ponoka has had a slight spike in costs last year, Phillips suggests the town must stay in line with the industry to ensure money is not lost.
“Our non-controlled costs will continue to escalate,” said Quinlan.
“Two-thirds of the costs are the transmission,” she added.
Running Ponoka’s power infrastructure as a business was something previous council wanted to see, explained Coun. Loanna Gulka. “This is a business. We need to invest in it so we get things back from it.”
Phillips feels the investment is worth it and suggests there are some communities that are neglecting this duty. “You need to keep fully recovering your distribution costs…It’s an ongoing business.”
Because of recent upgrades and increases, the town sits slightly higher than Fortis in terms of power distribution rates. Each year, under guidance from Phillips and industry regulations, council must approve new rates for the year. Service fees will see a slight increase this year to cover salaries and benefits.
A residential home with a monthly bill of $45.44 last year will see a new bill at $51.27, an increase of 12.83 per cent. Medium commercial property that typically received a bill of $2,276.46 will now pay $2,556.33, a rise of 12.29 per cent. Large commercial industries with a bill of $3,721.24 will now see a cost of $4,108.83, a rise of 10.42 per cent.
Medium commercial is slightly higher than Fortis rates and large commercial is 110 per cent of the cost of Fortis. Small commercial is 116 per cent of the Fortis cost and residential is 98 per cent.