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Alberta government announces new rules aimed at lowering utility bills

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    Alberta government announces new rules aimed at lowering utility bills

    Alberta government announces new rules for power generators aimed at lowering utility bills

    New measures directed at the practice of 'economic withholding'


    Alberta's government is updating its electricity market rules with new temporary measures it says will help lower consumers' utility bills.
    The new measures are aimed at the practice of "economic withholding," a strategy regularly used by power generators in Alberta's unique-to-Canada free-market electricity system.
    Under Alberta's competitive market design, electricity suppliers submit offers into the energy market known as the power pool every hour.
    The Alberta Electric System Operator then dispatches the suppliers' electricity, starting with the lowest-priced offers and moving higher until the province's power needs for that hour are met.
    Economic withholding is when power producers deliberately hold back some of their supply, offering it at a higher price. It's a gamble that can pay off if the operator needs that power, since the producer makes more money. It backfires if the province's power needs are met before it gets to the higher-priced offer.
    The practice is not illegal but has been highly criticized recently as one of the factors contributing to soaring consumer power bills in the province, as well as a growing number of occurrences where power prices in the province have been higher during off-peak periods than during periods of peak demand.
    "Our government is committed to Alberta's unique and investor-driven energy-only market. However, the market's rules were designed 25 years ago, and some are no longer optimal for the system today," said Utilities Minister Nathan Neudorf in a news release.

    The new rules will limit the offer price of natural gas generating units owned by large providers, if net revenues cross a predefined threshold. They will also require natural gas generating assets to be made available, as directed by the AESO, in certain circumstances such as extreme weather and other times of peak demand.
    The government said the changes will still allow generators to earn revenue while ensuring Albertans have access to affordable and reliable power.
    Electricity market changing

    Joel MacDonald, founder of electricity price comparison site energyrates.ca, said Alberta is one of only two jurisdictions in North America to have an energy-only electricity market, in which generators are not paid to have standby generating capacity. Instead, they are only paid for the electricity they actually dispatch to the grid.
    That means, MacDonald said, that if the government sets the ceiling for economic withholding too low, power producers will feel the impact on their bottom line and may be more hesitant to invest in building new generating capacity.
    "It will, in the short-term, reduce those high prices during peak periods but we're going to have, long-term, less generation. Less power plants are going to be built," he said.
    "If a lot of Albertans were very concerned about rolling brownouts mid-winter, this would actually make that potential crisis more likely to happen."
    Neudorf announced the changes in a speech at the annual conference of the Independent Power Producers Society of Alberta in Banff on Monday.
    The industry group, known as IPPSA, represents Alberta's electricity generators. The group has not yet replied to a request for comment.

    In a particularly high-profile example, Alberta was forced to declare an emergency grid alert in January when the system — under pressure from a number of natural gas plant outages as well as wind that was not blowing — came close to buckling.
    Alberta is also locked in a heated dispute with Ottawa over the federal government's proposed Clean Electricity Regulations, which Alberta has said cannot be achieved by 2035 without jeopardizing the stability and affordability of the province's power system.

    Under Premier Danielle Smith, the provincial government has a number of reviews underway looking at grid reliability, the future energy mix and electricity market design.

    Jason Wang, senior electricity analyst with clean energy think-tank the Pembina Institute, said he had hoped Neudorf would use Monday's IPPSA conference to provide more clarity about the province's future direction than he did.
    "Essentially what we know is there will be further changes to the market. But it needs to be timely and recognize the urgency of the energy transition and climate issues," Wang said.
    "If we get years of market uncertainty for developers without any indication of what the end result is going to look like, that could really slow down the net-zero transition."



    #2
    Does alberta not still have some of the lowest energy rates?
    i think my last bill was 8.8/ kwh?

    Isnt ontario on a swing price per " peak usage time' up to 29 c/ kwh between 5 and 8 pm?

    Comment


      #3
      I'm not sure what Chuck is saying here. I'm left with imagining another rant on profit and Alberta in general while shouting hypocrisy from behind a blindfold.
      Last edited by blackpowder; Mar 12, 2024, 12:25.

      Comment


        #4
        Originally posted by goalieguy847 View Post
        Does alberta not still have some of the lowest energy rates?
        i think my last bill was 8.8/ kwh?

        Isnt ontario on a swing price per " peak usage time' up to 29 c/ kwh between 5 and 8 pm?
        If this website is the least bit accurate, us Albertans are enjoying almost the most expensive electricity in the country.
        Once again disproving Chucks insistence that solar and wind are the least expensive generation sources.


        Comment


          #5
          See A5 won't even accept Danny Smith's attempt to stop over charging for electricity using "economic witholding" he would rather lay the unfounded blame on renewables.

          Even after Blake Shafer and other energy economists clearly have said "economic witholding" have caused Alberta electricity prices to rise much higher that almost everywhere else in Canada!

          But as we know A5 and facts don't mix!

          So what part of this exerpt from the Canadian Press article don't you understand A5?

          "Alberta's government is updating its electricity market rules with new temporary measures it says will help lower consumers' utility bills.
          The new measures are aimed at the practice of "economic withholding," a strategy regularly used by power generators in Alberta's unique-to-Canada free-market electricity system.
          Under Alberta's competitive market design, electricity suppliers submit offers into the energy market known as the power pool every hour.
          The Alberta Electric System Operator then dispatches the suppliers' electricity, starting with the lowest-priced offers and moving higher until the province's power needs for that hour are met.
          Economic withholding is when power producers deliberately hold back some of their supply, offering it at a higher price. It's a gamble that can pay off if the operator needs that power, since the producer makes more money. It backfires if the province's power needs are met before it gets to the higher-priced offer.
          The practice is not illegal but has been highly criticized recently as one of the factors contributing to soaring consumer power bills in the province, as well as a growing number of occurrences where power prices in the province have been higher during off-peak periods than during periods of peak demand.​"

          Comment


            #6
            Hope you realize this chart misinformation. Those are RRO rates nobody pays. Contract prices around 8 cents. What do you pay Chuck?

            Comment


              #7
              33% of my gas bill carb tax.

              Comment


                #8
                I know CC won't answer so any Sask guys share rates?

                Comment


                  #9
                  Saskatchewan farmers pay just around 15 cents a kwh all in. Basic monthly charge is $46.22. So the chart is not accurate for Saskatchewan.

                  What is the full cost in Alberta per Kwh including all the different charges that are broken down?

                  Comment


                    #10
                    Feb power bill.
                    938 KW hours x $.0885/ =$83.01
                    Administration $7.00
                    Distribution. $176.03
                    Transmission $.05833/ = $54.71
                    Load settlement. $1.40
                    GST. $16.11
                    $338.26

                    Gas bill. 23.6719 GJ.
                    Monthly operations. $30
                    Gas at $2.24/GJ. $53.03
                    Delivery $1.50/GJ. $35.51
                    Federal Fuel Charge.$3.327087/GJ
                    $78.76
                    GST. $9.87
                    $207.17
                    ​​​​​
                    Questions lie in the Distribution charge. Not power

                    Comment


                      #11
                      Originally posted by blackpowder View Post
                      Feb power bill.
                      938 KW hours x $.0885/ =$83.01
                      Administration $7.00
                      Distribution. $176.03
                      Transmission $.05833/ = $54.71
                      Load settlement. $1.40
                      GST. $16.11
                      $338.26

                      Gas bill. 23.6719 GJ.
                      Monthly operations. $30
                      Gas at $2.24/GJ. $53.03
                      Delivery $1.50/GJ. $35.51
                      Federal Fuel Charge.$3.327087/GJ
                      $78.76
                      GST. $9.87
                      $207.17
                      ​​​​​
                      Questions lie in the Distribution charge. Not power
                      February bill was 15.38 cents per kwh all in with 6.89 cents of that being generation. And yes transmission and distribution are the larger part of the bill.

                      Comment


                        #12
                        Originally posted by blackpowder View Post
                        Feb power bill.
                        938 KW hours x $.0885/ =$83.01
                        Administration $7.00
                        Distribution. $176.03
                        Transmission $.05833/ = $54.71
                        Load settlement. $1.40
                        GST. $16.11
                        $338.26

                        Gas bill. 23.6719 GJ.
                        Monthly operations. $30
                        Gas at $2.24/GJ. $53.03
                        Delivery $1.50/GJ. $35.51
                        Federal Fuel Charge.$3.327087/GJ
                        $78.76
                        GST. $9.87
                        $207.17
                        ​​​​​
                        Questions lie in the Distribution charge. Not power
                        So BP you are paying 36 cents per kwh and Saskatchewan farmers are paying 15 cents. Well thats only 20 cents per Kwh higher! You can thank the deregulated energy market in Alberta for your electricity price which is 2.4 times higher than Saskatchewan!

                        Comment


                          #13
                          At this point, I don't have enough information on the two systems to comment further. A fair amount of study required for full comparison.
                          There is also an amount of history to wade through as well. REA amalgamation and number of miles of heritage line comparison to name a few.
                          I have driven around both provinces over the last 40 years. Have cored coal at several power plant mines in both as well. Number and age of plant comparisons deserve a look.
                          Vetting your information and harder to find answers a full project.
                          I don't take a professors word as gospel any more than Rachel Notleys husband, who was part of the new plan. Or the companies for that matter.
                          Maybe we should be more precise in our discussions. Power itself compared to the full service.
                          Without this work, I will allow you to gloat in a degree of ignorance. It appears to fill your cup.

                          Comment


                            #14
                            Also, depends on size of transformer in your yard by the way.

                            Comment


                              #15
                              Agreed.
                              This reminds me of electronics, or mattress shopping.
                              Every store guarantees the best price on the exact model.
                              And every store sells a slightly unique model number from all of their competition.

                              Comment

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