The electricity price cap in Alberta is gone. What now?

EnergyRates.ca

Published

5 years ago

5 minute read

How the electricity price cap removal will affect Alberta utility bills (Photo by Helloquence on Unsplash)

Many Albertans have been reading the news about higher regulated electricity rates in December, after the price cap on energy rates was scrapped by the province. Even though this was announced by the Government of Alberta in late October, as part of the new budget, people only started to hear more about it on November 30. That was when the regulated energy providers announced their new power rates; this time, without a cap on prices.

The program was created by the NDP government in 2017 to cap energy rates for residential and small business consumers. Regulated rate (RRO) consumers wouldn’t pay more than 6.8 cents per kWh, meaning that any costs above that threshold were paid by the province. The main goal behind the cap was to protect consumers from rate spikes and, consequently, financial uncertainty.

In order to predict how your energy bills (and your wallet) could be impacted by this change, we need to take a look at historical prices, future market trends and what prices would’ve been this past year without the cap.

How the 6.8 cents/kWh price cap worked

Regulated electricity rates in Alberta change every month. Although the prices need to be approved by the Alberta Utilities Commission (AUC), they can be affected by multiple factors, including politics, natural disasters, economic reasons and more.

In the past 10 years, electricity rates in Alberta went as high as 15.06 cents/kWh and as low as 2.88 cents/kWh. The cap provided protection for Albertans as the government subsidized any prices above 6.8 cents/kWh.

The effects of the electricity price cap in Calgary in 2019

According to the Utilities Consumer Advocate (UCA), regulated electricity rates in the Calgary area (ENMAX) went above the 6.8 cents/kWh during most months of 2019, except for March, April, May and June.

January: 7.727 cents/kWh
February: 7.009 cents/kWh
March: 5.914 cents/kWh
April: 6.067 cents/kWh
May: 6.390 cents/kWh
June: 6.391 cents/kWh
July: 8.434 cents/kWh
August: 8.805 cents/kWh
September: 7.590 cents/kWh
October: 6.736 cents/kWh*
November: 7.399 cents/kWh
December: 7.320 cents/kWh

*According to the UCA, prices still reached the price cap in October, although they were officially 6.736 cents/kWh.

This means the average price would’ve been approximately 7.15 cents/kWh, which makes quite a difference in energy bill terms, considering that the average household in Canada consumes around 1,000 kWh per month. After an entire year of high electricity rates, this difference looks even larger.

The effects of the electricity price cap in Edmonton in 2019

In the Edmonton region (EPCOR), the difference between what consumers paid and what they would’ve paid without the cap is even more noticeable. According to the UCA, regulated prices went above the 6.8 cents threshold in all months except for March.

Without the cap, the average price per kWh in the Edmonton area in 2019 would’ve been 7.84 cents/kWh.

January: 7.733 cents/kWh
February: 7.189 cents/kWh
March: 5.991 cents/kWh
April: 6.981 cents/kWh
May: 6.990 cents/kWh
June: 7.231 cents/kWh
July: 9.578 cents/kWh
August: 10.191 cents/kWh
September: 8.2 cents/kWh
October: 7.342 cents/kWh
November: 8.63 cents/kWh
December: 8.069 cents/kWh

Are my electricity bills going to increase in the months ahead?

Now that the price cap is gone, many households and small businesses are concerned about facing higher utility costs in the months ahead.

Power prices reached historically low averages in 2017, but the average rate in Alberta was 7.3 cents/kWh for the 2002-2018 period, which is considerably above the price cap, especially in cents/kWh terms.

The future of electricity prices is still unclear. Consumers will have to wait and see whether rates will go up or down. We can expect to see RRO prices fluctuate slightly more now that they are free to go above the 6.8 cents/kWh threshold, as it happened in December and for most of the time in 2019.

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The electricity price cap in Alberta is gone. What now?

Alberta

CPP another example of Albertans’ outsized contribution to Canada

Published on April 19, 2025

Todayville

From the Fraser Institute

By Tegan Hill

Amid the economic uncertainty fuelled by Trump’s trade war, its perhaps more important than ever to understand Alberta’s crucial role in the federation and its outsized contribution to programs such as the Canada Pension Plan (CPP).

From 1981 to 2022, Albertan’s net contribution to the CPP—meaning the amount Albertans paid into the program over and above what retirees in Alberta received in CPP payments—was $53.6 billion. In 2022 (the latest year of available data), Albertans’ net contribution to the CPP was $3.0 billion.

During that same period (1981 to 2022), British Columbia was the only other province where residents paid more into the CPP than retirees received in benefits—and Alberta’s contribution was six times greater than B.C.’s contribution. Put differently, residents in seven out of the nine provinces that participate in the CPP (Quebec has its own plan) receive more back in benefits than they contribute to the program.

Albertans pay an outsized contribution to federal and national programs, including the CPP because of the province’s relatively high rates of employment, higher average incomes and younger population (i.e. more workers pay into the CPP and less retirees take from it).

Put simply, Albertan workers have been helping fund the retirement of Canadians from coast to coast for decades, and without Alberta, the CPP would look much different.

How different?

If Alberta withdrew from the CPP and established its own standalone provincial pension plan, Alberta workers would receive the same retirement benefits but at a lower cost (i.e. lower CPP contribution rate deducted from our paycheques) than other Canadians, while the contribution rate—essentially the CPP tax rate—to fund the program would likely need to increase for the rest of the country to maintain the same benefits.

And given current demographic projections, immigration patterns and Alberta’s long history of leading the provinces in economic growth, Albertan workers will likely continue to pay more into the CPP than Albertan retirees get back from it.

Therefore, considering Alberta’s crucial role in national programs, the next federal government—whoever that may be—should undo and prevent policies that negatively impact the province and Albertans ability to contribute to Canada. Think of Bill C-69 (which imposes complex, uncertain and onerous review requirements on major energy projects), Bill C-48 (which bans large oil tankers off B.C.’s northern coast and limits access to Asian markets), an arbitrary cap on oil and gas emissions, numerous other “net-zero” targets, and so on.

Canada faces serious economic challenges, including a trade war with the United States. In times like this, it’s important to remember Alberta’s crucial role in the federation and the outsized contributions of Alberta workers to the wellbeing of Canadians across the country.

Alberta

Made in Alberta! Province makes it easier to support local products with Buy Local program

Published on April 14, 2025

Government of Alberta

Show your Alberta side. Buy Local.

When the going gets tough, Albertans stick together. That’s why Alberta’s government is launching a new campaign to benefit hard-working Albertans.

Global uncertainty is threatening the livelihoods of hard-working Alberta farmers, ranchers, processors and their families. The ‘Buy Local’ campaign, recently launched by Alberta’s government, encourages consumers to eat, drink and buy local to show our unified support for the province’s agriculture and food industry.

The government’s ‘Buy Local’ campaign encourages consumers to buy products from Alberta’s hard-working farmers, ranchers and food processors that produce safe, nutritious food for Albertans, Canadians and the world.

“It’s time to let these hard-working Albertans know we have their back. Now, more than ever, we need to shop local and buy made-in-Alberta products. The next time you are grocery shopping or go out for dinner or a drink with your friends or family, support local to demonstrate your Alberta pride. We are pleased tariffs don’t impact the ag industry right now and will keep advocating for our ag industry.”

RJ Sigurdson, Minister of Agriculture and Irrigation

Alberta’s government supports consumer choice. We are providing tools to help folks easily identify Alberta- and Canadian-made foods and products. Choosing local products keeps Albertans’ hard-earned dollars in our province. Whether it is farm-fresh vegetables, potatoes, honey, craft beer, frozen food or our world-renowned beef, Alberta has an abundance of fresh foods produced right on our doorstep.

Quick facts

This summer, Albertans can support local at more than 150 farmers’ markets across the province and meet the folks who make, bake and grow our food.
In March 2023, the Alberta government launched the ‘Made in Alberta’ voluntary food and beverage labelling program to support local agriculture and food sectors.
Through direct connections with processors, the program has created the momentum to continue expanding consumer awareness about the ‘Made in Alberta’ label to help shoppers quickly identify foods and beverages produced in our province.
Made in Alberta product catalogue website