UCP gov­ern­ment halts switch to ca­pac­ity elec­tric­ity mar­ket

The Drumheller Mail - - News - Pa­trick Ko­lafa

The Al­berta gov­ern­ment has re­versed the former NDP gov­ern­ment's de­ci­sion to move to­wards a ca­pac­ity elec­tric­ity mar­ket. This is where power gen­er­a­tors are paid for its over­all abil­ity to pro­duce elec­tric­ity, and re­main en­ergy-only mar­ket.

The former gov­ern­ment planned to have the ca­pac­ity mar­ket model im­ple­mented by 2021. The gov­ern­ment de­ci­sion will stop that process and con­tinue in an en­ergy mar­ket where elec­tric­ity gen­er­a­tors are paid only for the elec­tric­ity they pro­duce in real-time.

“Al­ber­tans and in­vestors need cer­tainty in our province’s elec­tric­ity mar­ket sys­tem, not an ex­per­i­ment. The en­ergy-only mar­ket works. In­vestors want to par­tic­i­pate in it and it pro­vides Al­ber­tans with re­li­able and af­ford­able elec­tric­ity,” Sonya Sav­age, Min­is­ter of En­ergy said.

The change came af­ter the gov­ern­ment held five round ta­ble ses­sions with key stake­hold­ers.

“Part of our cam­paign prom­ises was that we said in 90 days we would come up with a de­ci­sion on whether we would pro­ceed with that by 2021 or we would stay with an en­ergy-only mar­ket and I be­lieve we came to the right con­clu­sion,” Drumheller-Stet­tler MLA Nate Horner told the Mail. “In hear­ing the min­is­ter's con­sul­ta­tions she said it was ba­si­cally unan­i­mous, there was maybe one ex­cep­tion.”

“The ca­pac­ity mar­ket, while it is used in some places, it is, in my mind, a mar­ket that is used to push re­new­able on a pop­u­la­tion. You are paid for the power you could pro­duce, not the power you pro­duce and I don’t think it was ever thought through.”

Part of the NDP’s move to a ca­pac­ity mar­ket is they capped the price of power for elec­tric­ity for con­sumers and the dif­fer­ence was paid through the car­bon tax. Horner says re­mov­ing the cap may be dis­cussed.

For con­sumers, the real­ity is cur­rently only a small por­tion of their elec­tric­ity bill is made up of charges for elec­tric­ity. Of­ten this is dwarfed by dis­tri­bu­tion and trans­mis­sion charges.

John Shoff of Real­ity Byes in Drumheller says this is the most con­cern­ing is­sue.

He ex­plains Drumheller res­i­dents pay a much higher rate for trans­mis­sion and dis­tri­bu­tion than in ur­ban cen­ters be­cause the area is so vast and the pop­u­la­tion is sparse. Res­i­dents of Cal­gary or Ed­mon­ton see much lower rates for trans­mis­sion and dis­tri­bu­tion.

“If we could take the en­tire province and ev­ery­body is pooled into one plat­form and the dis­tri­bu­tion fees are paid out of it, that to me would be the best way, It is a pro­vin­cial elec­tric grid so why aren’t we pay­ing into it equally?” Shoff said. “The way it is right now is you are in an area. If you are in an ACTO area you pay their rate, If you are in For­tis’ area you pay their rate.”

Horner agrees this is a press­ing is­sue.

“Right now we are hear­ing about the price of power, but the real is­sue out in Al­berta is trans­mis­sion and dis­tri­bu­tion,” he said.

He be­lieves the UCP gov­ern­ment will look into this is­sue.

“I be­lieve it is a cri­sis that is fac­ing Al­berta, to be frank. I think it is right up there with pipe­lines and the caribou file. What­ever the Al­berta ad­van­tage was it had to have af­ford­able power. When we talk about di­ver­si­fy­ing and man­u­fac­tur­ing, we need af­ford­able power.”

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