Alberta utilities watchdog shuts down company’s offer of ‘refund’ on consumer bills
Global News
"AltaLink's proposal would immediately require ... customers to pay back its 'refund' with interest and carrying charges over the next 46 years," the commission wrote.
Alberta’s utilities watchdog has shut down a plan from a power transmission company to give ratepayers a refund, saying the small cash payout proposed by AltaLink would ultimately cost consumers millions more than it returned.
“AltaLink’s proposal would not result in a just and reasonable tariff even though it would provide Alberta’s electricity customers with some modest relief on their electricity bills,” says the decision from the Alberta Utilities Commission.
“AltaLink’s proposal would immediately require … customers to pay back its ‘refund’ with interest and carrying charges over the next 46 years.”
The decision, released Friday, comes after AltaLink — Alberta’s largest electricity transmitter — twice asked the commission for permission to give consumers a refund. AltaLink said the opportunity for a refund was generated by slower-than-expected depreciation of some company assets.
“Alberta consumers are feeling the pressure of high energy prices on electricity bills,” said AltaLink president Gary Hart in a May 2 press release. “Because we won’t require these funds for an extended period of time, we believe it makes more sense to put this $120 million back into the pockets of Albertans who need it most.”
AltaLink’s proposal would have reduced the average household bill by $5 a month.
But the commission pointed out the refund would have been financed by a bank loan, not cash. With interest, carrying charges and other fees, the loan would have ultimately cost more than $250 million by the end of its term — all of which would have been recouped from consumers.
“There is no persuasive reason why future customers should pay higher electricity rates for 46 years given the modest relief in 2022,” the commission wrote.