NDP gives consumers reason to worry
New information obtained by the Manning Centre shows consumers in Alberta have good reason to be concerned about the Notley government’s recent electricity sector changes.
Observers have suggested the government’s changes – shutting down coal plants, introducing a carbon tax, requiring expensive wind power – could cause power bills to double or even trouble. Others have raised concerns about the government’s erratic behaviour that has damaged investor confidence.
We decided to investigate the government’s plan further and asked the Notley government for their estimates on the impact to the average household’s power bill. While the government’s “Climate Leadership” report indicates consumers can expect the changes to cost “$900 per year” by 2030, we wanted to know about the best and worst case scenarios. After all, government modelling usually takes into account several different variables and produces a range of possibilities.
After filing information requests with the government, we received several pages with redacted details – including their estimates on the impact to households. This obviously begs the question – what is the government hiding?
We asked the government if estimates on the impact on businesses would also be redacted if we formally requested those details. We were told “yes.”
With that in mind, it seems the government may have provided some information by accident. On one of the pages we received, a bureaucrat notes “Electricity prices are projected to increase as a result of the Climate Change initiatives for small and large industrial customers by 20% between 2021 to 2025 and 10% between 2026 to 2030.”
Compounded, that’s a 32% increase due to government policy (on top of regular increases). As Alberta’s economy struggles to recover, one has to wonder – how a significant jump in electricity bills for industrial users will help keep jobs here or attract new investment?
As many readers will know, the government has also announced it will be forcing coal power plants to shut down by 2030. This has led many to speculate as to how much the government will have to spend on compensation to owners of those plants for rendering their assets useless. While experts disagree on the cost, the bill won’t be a small one.
Just as you would review your household finances before buying a $5,000 air conditioner, one would hope the government would have done the same before moving ahead with its costly electricity system restructuring “plan.” Documents obtained by the Manning Centre suggest that hasn’t happened.
We asked the Ministry of Finance for information on the cost of compensating businesses due to the early-phase out of coal-power plants. Knowing that such estimates would likely be considered confidential, we asked for the documents even if the figures had to be blacked out.
The government indicated, “a thorough search conducted by Treasury Board and Finance staff failed to retrieve any records.” Thus, unless the government can prove otherwise (hopefully they can), it seems Premier Notley signed off on the department of environment’s multi-billion dollar plan, without checking with the Ministry of Finance as to whether or not the province could afford it.
One thing is clear; consumers should be concerned about the government’s plan…or lack thereof.
Colin Craig works for the Manning Centre and is the author of The Government Wears Prada
This column was published by the Edmonton Sun and Calgary Sun on October 20, 2016