The decision of the Island’s Regulatory and Appeal Board is dated last week and was released on Tuesday morning. Maritime Electric provides electricity to virtually every Islander outside of Summerside. This city has its own electric utility.
The tariff for the first block of electricity, up to 2,000 kWh per month, for residential customers increases by 3.8%. The monthly service charge of $ 24.57 for urban customers and $ 26.92 for rural customers is unchanged, so the overall cost increase will be less than 3.8%, depending on the amount of electricity. consumed by a household.
For small industrial users, the price is up 3.6% on the first block and 4.4% for electricity consumption above. Large industrial users see a 3.6 percent increase.
The board is not prepared to allow inequalities in Maritime Electric’s pricing structure to extend beyond the current pricing period.– Written decision from the IRAC
“This is the first time in three years that we have made a rate adjustment and we certainly appreciate that, you know, customers will have to budget and plan accordingly,” said Maritime President and CEO Electric, Jason Roberts.
Roberts said overall demand for electricity fell in 2020.
“We are doing our best to manage our costs. We’ve taken steps this year to cut costs where we can, ”Roberts said. “And we are trying to manage these rate increases as well as possible. ”
Initial request refused
The utility initially requested in fall 2018 a series of tariff increases totaling 4.1% over three years, but this request was rejected by the IRAC. The pandemic has resulted in further delays in adjusting rates.
Today, it is the average islanders and the small consumers of electricity who bear the highest cost of this energy.– Steven Howard, Opposition Critic for Energy
The RAIC approval also allows Maritime Electric to account for an additional increase, already factored into the new tariffs, for a period of up to 14 months to recover lost revenue resulting from the delay in increased tariffs.
The regulator ruled that the utility could recoup $ 2.8 million by increasing its tariffs until February 2022. Without this measure, the company expected a 7.88% return on investment for operation in 2020, in below the maximum of 9.35% allowed by provincial regulations.
No modification of the second bulk billing
The utility did not include a plan to end the second block billing in its last rate application. Under its current rate structure, Maritime Electric charges a lower rate to residential and farm customers who use more than 2,000 kWh of electricity during a monthly billing period.
For years, the RAIC has called on the utility to end the practice, claiming that large farms end up “paying less than the cost of the service and being subsidized by other taxpayers.”
“The board is not prepared to allow inequalities in Maritime Electric’s pricing structure to continue beyond the current pricing period,” the RAIC wrote in its ruling on the current claim.
A spokesperson for Maritime Electric said the company was preparing to come forward with a proposal for a new pricing structure early in the new year. The RAIC suggested phasing out the second global bill “within a reasonable time”.
“Unfair advantage” for heavy users, according to the opposition
“It appears that the new tariffs, although approved for only one year, continue this unfair advantage for heavy electricity users,” Green MP Steven Howard said.
As opposition energy critic, Howard sought and received intervenor status by the RAIC in its assessment of Maritime Electric’s tariff request.
“Right now, middle islanders and low consumers of electricity bear the highest cost of this energy.