Access fee legislation unlikely to affect the Hat
A provincial government plan to change how utility access fees are calculated likely won’t affect how the fee is determined in Medicine Hat.
Local officials have said they base the charge on a percentage of more stable regulator distribution rates, rather than as a percentage of energy prices, as the City of Calgary does.
That city came under scrutiny in 2023 after it collected $200 million more than expected when default power prices rose to record levels and dragged the fee with it.
This week, Utilities Minister Nathan Neudorf said legislation this sitting would halt the use of variable rates in determining the billed amount.
Instead, only a percentage of distribution rates (set once annually) and usage could be factors.
The City of Medicine Hat utility does both.
For power, a daily “Municipal Consent and
Access Fee” charge of 3.8 cents is combined with a usage fee of 0.2 cents per kilowatt hour.
The daily fee on natural gas is 8.6 cents and the per-gigajoule charge is 16.2 cents.
City officials state the average residence was charged about $130 combined in 2023, compared to Lethbridge ($295), Red Deer ($288), Edmonton ($291) and Calgary ($312). Those centres also own distribution lines which form the basis of the fees, charged to utility companies and then recovered through the charge on bills.
Medicine Hat introduced the fee for customers within city limits in 2019 to help address a municipal budget gap without adding to property taxes.
Finance officials state the city collected about $5 million