Customers may see small hike in natural gas bill

Saskatchewan’s natural gas distributor has applied for a delivery service fee increase that would result in the average residential customer paying $1.65 more per month — just over two per cent of their bill — effective Nov. 1.

SaskEnergy moves about 50 per cent more gas than it did in 2009 — a result of the province’s growing population — leading to increased maintenance and monitoring costs, the Crown corporation’s president and chief executive said Tuesday.

The proposed increase, which must be approved by the provincial rate review panel and cabinet, is also expected to support more than $50 million in capital expenditures planned for this year, said Ken From, who was appointed to his role in November 2016. “The cities of Regina and Saskatoon, they ’ve been expanding a lot. Natural gas is part of development: We need that to serve developing areas (but) we also need to make sure our development is outside where a lot of construction’s going to be.”

According to SaskEnergy, “system integrity” capital expenditures have grown dramatically during the last decade, to a projected $51.3 million this year from $7 million in 2008 — and a forecast of $55.6 million in 2018-19.

The bulk of that money is earmarked for major pipeline expansions in the two major cities: $40.5 million in Regina over the next six years, plus an additional $26.7 million in Saskatoon over the next four years.

Despite the Crown corporation’s robust fiscal health — it made $111 million on revenues totalling $586 million in 2015-16 — From said demand for gas is growing and customers typically prefer more small increases to fewer large ones.

SaskEnergy last adjusted its rates in the summer of 2016, when a 14 per cent cut to its commodity rate — the price of natural gas — offset an 8.6 per cent increase to its delivery charge to the tune of $1.70 in monthly savings for the typical customer.

The latest proposed rate increase will only affect the Crown corporation’s delivery fee. It said in a news release Tuesday the price of gas is expected to remain stable through the winter. Last month, SaskEnergy announced plans to shut down gas service to 247 homes in the Last Mountain Lake region, where it has been detecting underground leaks at around 100 times the provincial average.