Alberta’s NDP government plans to cap consumer power rates at a maximum of 6.8 cents per kilowatt hour for four years, starting June 1, 2017.
“Alberta’s energy-only electricity market is broken,” Premier Rachel Notley said at a news conference in Edmonton on Tuesday. “It will not bring in the kind of investment that will be needed to power Alberta’s future.”
The move is the government’s first step in moving Alberta away from the deregulated power market that was implemented in the 1990s. More announcements are expected this week.
Currently, consumers who are not on contracts pay a fluctuating rate based on market prices.
The government decided on the rate based on the number forecasted by private operators five years from now.
The current average electricity price is 3.8 cents per kilowatt hour.
The price ceiling will apply to people with a regulated rate option. If the RRO is below 6.8 cents, they will still pay the lower rate.
Energy Minister Marg McCuaig-Boyd will lead a consultation with consumers and power companies starting in December on ways to reach that cap.