Hydro is far cheaper in Alberta — with a sparser population on a huge land base

by Garfield Marks

Is it time to have or implement a National Electrical Strategy?

I live in Red Deer, a small city in central Alberta. My electrical bill last month was $95.

The average household in Canada uses 972 kWh monthly, according to Google, but I used 848 kWh last month, so if I was an average user then my bill would have been $109.

My bill shows that my electrical use cost only $32.40 while administration cost $6.99, distribution cost $25.90 and transmission fees cost $23.86. Include access fees, rate riders and balancing pool allocations and GST, and my bill came to $95.

Talk of carbon taxes, green energy, would increase my energy costs. Fine, increasing my energy costs by 10 percent would mean an increase of only $3.24 because all the other charges should not go up. Changing fuel or supply should not affect administrators, power lines, poles or switches.

I started requesting electric bills from homes in other parts of Alberta and the energy costs varied from 3.75 cents/kWh to 5.99 cents/kwh, and the other costs varied in name and amount for varying total costs per kWh from 11.70 to 15.75 cents. So at 848 kWh, my bill would go from $95 up to $133.56 depending on location.

Alberta is deregulated and you have options of providers, floating and fixed rates, but the other fees are always added.

A home in Vancouver showed an average 11.37 cents/kWh, so my bill would be $96.50, very similar to what it is now. Vancouver is vastly different and denser market, with 5,249 people or 2,100 homes per square kilometre.

Alberta has a population of 4,252,879 people in 640,081.87 square kilometres for a density of 6.7 people or 2.7 homes per square kilometre. So you would think that the costs would be astronomically higher to compensate for the vast distances, and the increased wiring, poles, and installation of such— but apparently not.

So I thought about Ontario. Population of 13,982,984 in 908,607 square kms of land — 15.4 people or 6.2 homes per square kilometre. More than twice the density of Alberta. The transmission and distribution costs should be equal to or less than sparsely populated Alberta. I started requesting power bills from home owners in Ontario, especially in rural Ontario.

The first bill came from Winchester, south of Ottawa. It showed a monthly usage of 661.24 kWh. Energy costs varied from 8.7 cents/kWh of low peak to 18 cents/kwh during high peak for an energy cost of $79.06. Add in delivery charge of $65.41, regulatory fees and HST, and the total bill comes to $164.96 — or 25 cent/kwh. My $95 bill in Red Deer would be $211.55 if I lived in Winchester.

The second bill came from a family outside Chesterville. It showed higher usage, perhaps because of location, age of appliances or lifestyle — with 1,281 kWh and a bill of $278.93, or 22 cents/kwh. My bill would be $184.65 if I lived outside Chesterville.

Albertans get their power from natural gas (44%), coal (39%) and even hydro (6%) while Ontarians get their power largely from nuclear (66%) and hydro (22%). But in Alberta, we are expecting increases in our power bills due to carbon taxes, green initiatives and new power lines being built to the southern border — paid by current users to provide power south of the border. Ontario has some similar changes and challenges ahead, leading to expectations of further cost increases. Is this proper?

Alberta’s population is only 30 percent of Ontario’s, on a land base 70 percent as large, yet Alberta power bills are substantially lower. Capitalists will tell you that larger markets like Ontario should translate into lower costs.

Alberta deregulated the electrical sector, increasing competition. Would that help or exasperate the problem in Ontario? Should the vast majority of urban homes subsidize the rural users? Should a standard rate be applied to all in Ontario?

To recap, the average Canadian household’s monthly electricity consumption of 972 kWh would cost $110.61 in Vancouver, B.C., $108.90 in Red Deer, Alta., $242.48 in Winchester Ont., and $211.65 in Chesterville Ont. Definitely not a level playing field, is it?

Is it time for the Federal Government to create a National Electrical Strategy? We could at least study on it.

What do you think?

Editor’s note: Differences in time of use would have produced the variation in the two North Dundas Township households (Winchester and Chesterville), which are both served by the same utility, Hydro One. This doesn’t affect the columnist’s key point about high electricity costs in this province versus the rest of the country.

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