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Uneven electrical bills could create a National Electric Strategy

Published

8 years ago

5 minute read

Is it time to have or implement a National Electrical Strategy?

I live in Red Deer, a small city in Central Alberta. My electrical bill last month was $95.

The average household, according to Google, in Canada uses 972 KWHs monthly, but I used 848 KWHs last month, so if I had been an average user then my bill would have been $109.

My electrical bill shows that my electrical use cost only $32.40 while administration cost $6.99, distribution cost $25.90 transmission fees cost $23.86, include access fees, rate riders and balancing pool allocations and GST and my bill came to $95.

Talk of carbon taxes, green energy would increase my energy costs. Fine, increasing my energy costs by 10% would mean an increase of only $3.24 because all the other charges should not go up. Changing fuel or supply should not affect administrators, power lines, poles or switches.

I started requesting electric bills from homes in other parts of Alberta and the costs varied from 3.75/ kwh to 5.99/kwh and the other costs varied in name and amount for varying total costs per kwh from 11.7 to 15.75/kwh. So at 848 kwh my bill would go from $95 up to $133.56 depending on location.

Alberta is deregulated and you have options of providers. Floating and fixed rates, but the other fees are always added.

A home in Vancouver showed an average 11.37/kwh so my bill would be $96.50, very similar to my Alberta bill. Vancouver is vastly different and denser market. Vancouver has 5,249 people per km. or 2100 homes per square km.

Alberta has a population of 4,252,879 people in 640,081.87 sq. kms. For a density of 6.7 people per square km. or 2.7 homes per square km. So you would think that the costs would be astronomically higher to compensate for the vast distances, and the increased wiring, poles, and installation of such, but apparently not.

So I thought about Ontario. Population of 13,982.984 in 908,607 square kms of land. 15.4 people or 6.2 homes per square kms. More than twice the density of Alberta. The transmission and distribution costs should be equal to or less than sparsely populated Alberta. I started requesting power bills from home owners in Ontario, especially in rural Ontario.

The first bill came from Winchester, 40 kms. from Ottawa. It showed a monthly usage of 661.24 KWHs. Energy costs varied from 8.7/kwh of low peak to 18/kwh during high peak for energy cost of $79.06. Add in delivery charge of $65.41, regulatory fees and HST and the bill comes to $164.96. Or 25/kwh. My current bill would now be $211.55 if I lived in Winchester.

The second bill came from a family outside Chesterville. It showed higher usage, perhaps because of location, age of appliances or lifestyle. Energy use of 1281 KWHs for a bill of $278.93 or 22/kwh. My bill would then be $184.65 if I lived outside Chesterville.

Albertans get their power from natural gas (44%), coal (39%) and even hydro (6%) while Ontario get their power from Nuclear, (66%) and Hydro (22%) But in Alberta, we are expecting increases in our power bills due to carbon taxes, green initiatives and the new power lines being built to the southern border. Paid for by current users to provide power south of the border. Ontario has some similar changes and challenges ahead to incur expectations of increased costs. Is this proper?

Alberta is only 70% the size of Ontario, our population is only 30% of Ontario, yet Alberta power bills are substantially lower. Capitalists will tell you that larger markets like Ontario, means lower costs, as one would also expect with increased density as in this case, Ontario.

Alberta deregulated the electrical sector increasing competition. Would that help or exasperate the problem in Ontario? Should the vast majority of urban homes subsidize the rural users? Should a standard rate be applied to all in Ontario?

To recap with averages of 972 KWHs per home per month it would cost $110.61 in Vancouver B.C., $108.90 in Red Deer Ab., $242.48 in Winchester Ont. And $211.65 in Chesterville Ont. Definitely not a level playing field, is it?

Is it time for the Federal Government to create a National Electrical Strategy? We could at least study on it.

What do you think?

 

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Broken ‘equalization’ program bad for all provinces

Business

Broken ‘equalization’ program bad for all provinces

Published on November 21, 2024

By

From the Fraser Institute

By Alex Whalen  and Tegan Hill

Back in the summer at a meeting in Halifax, several provincial premiers discussed a lawsuit meant to force the federal government to make changes to Canada’s equalization program. The suit—filed by Newfoundland and Labrador and backed by British Columbia, Saskatchewan and Alberta—effectively argues that the current formula isn’t fair. But while the question of “fairness” can be subjective, its clear the equalization program is broken.

In theory, the program equalizes the ability of provinces to deliver reasonably comparable services at a reasonably comparable level of taxation. Any province’s ability to pay is based on its “fiscal capacity”—that is, its ability to raise revenue.

This year, equalization payments will total a projected $25.3 billion with all provinces except B.C., Alberta and Saskatchewan to receive some money. Whether due to higher incomes, higher employment or other factors, these three provinces have a greater ability to collect government revenue so they will not receive equalization.

However, contrary to the intent of the program, as recently as 2021, equalization program costs increased despite a decline in the fiscal capacity of oil-producing provinces such as Alberta, Saskatchewan, and Newfoundland and Labrador. In other words, the fiscal capacity gap among provinces was shrinking, yet recipient provinces still received a larger equalization payment.

Why? Because a “fixed-growth rule,” introduced by the Harper government in 2009, ensures that payments grow roughly in line with the economy—even if the gap between richer and poorer provinces shrinks. The result? Total equalization payments (before adjusting for inflation) increased by 19 per cent between 2015/16 and 2020/21 despite the gap in fiscal capacities between provinces shrinking during this time.

Moreover, the structure of the equalization program is also causing problems, even for recipient provinces, because it generates strong disincentives to natural resource development and the resulting economic growth because the program “claws back” equalization dollars when provinces raise revenue from natural resource development. Despite some changes to reduce this problem, one study estimated that a recipient province wishing to increase its natural resource revenues by a modest 10 per cent could face up to a 97 per cent claw back in equalization payments.

Put simply, provinces that generally do not receive equalization such as Alberta, B.C. and Saskatchewan have been punished for developing their resources, whereas recipient provinces such as Quebec and in the Maritimes have been rewarded for not developing theirs.

Finally, the current program design also encourages recipient provinces to maintain high personal and business income tax rates. While higher tax rates can reduce the incentive to work, invest and be productive, they also raise the national standard average tax rate, which is used in the equalization allocation formula. Therefore, provinces are incentivized to maintain high and economically damaging tax rates to maximize equalization payments.

Unless premiers push for reforms that will improve economic incentives and contain program costs, all provinces—recipient and non-recipient—will suffer the consequences.

Authors:

Alex Whalen  and Tegan Hill
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National

Liberals, NDP admit closed-door meetings took place in attempt to delay Canada’s next election

Published on November 12, 2024

By

From LifeSiteNews

By Anthony Murdoch

Pushing back the date would preserve the pensions of some of the MPs who could be voted out of office in October 2025.

Aides to the cabinet of Prime Minister Justin Trudeau confirmed that MPs from the Liberal and New Democratic Party (NDP) did indeed hold closed-door “briefings” to rewrite Canada’s elections laws so that they could push back the date of the next election.

The closed-door talks between the NDP and Liberals confirmed the aides included a revision that would guarantee some of its 28 MPs, including three of Trudeau’s cabinet members, would get a pension.

Allen Sutherland, who serves as the assistant cabinet secretary, testified before the House of Commons affairs committee that the changes to the Elections Act were discussed in the meetings.

“We attended a meeting where the substance of that proposal was discussed,” he said, adding that his “understanding is the briefing was primarily oral.”

According to Sutherland, as reported by Blacklock’s Reporter, it was only NDP and Liberal MPs who attended the secret meetings regarding changes to Canada’s Elections Act via Bill C-65, An Act to Amend the Canada Elections Act before the bill was introduced in March.

As reported by LifeSiteNews before, the Liberals were hoping to delay the 2025 federal election by a few days in what many see as a stunt to secure pensions for MPs who are projected to lose their seats. Approximately 80 MPs would qualify for pensions should they sit as MPs until at least October 27, 2025, which is the newly proposed election date. The election date is currently set for October 20, 2025.

Sutherland noted when asked by Conservative MP Luc Berthold that he recalled little from the meetings, but he did confirm he attended “two meetings of that kind.”

“Didn’t you find it unusual that a discussion about amending the Elections Act included only two political parties and excluded the others?” Berthold asked.

Sutherland responded, “It’s important to understand what my role was in those meetings which was simply to provide background information.”

“My role was to provide information,” replied Sutherland, who added he could not provide the exact dates of the meetings.

MPs must serve at least six years to qualify for a pension that pays $77,900 a year. Should an election be called today, many MPs would fall short of reaching the six years, hence Bill C-65 was introduced by the Liberals and NDP.

The Liberals have claimed that pushing back the next election date is not over pensions but due to “trying to observe religious holidays,” as noted by Liberal MP Mark Gerretsen.

“Conservatives voted against this bill,” Berthold said, as they are “confident of winning re-election. We don’t need this change.”

Trudeau’s popularity is at a all-time low, but he has refused to step down as PM, call an early election, or even step aside as Liberal Party leader.

As for the amendments to elections laws, they come after months of polling in favour of the Conservative Party under the leadership of Pierre Poilievre.

A recent poll found that 70 percent of Canadians believe the country is “broken” as Trudeau focuses on less critical issues. Similarly, in January, most Canadians reported that they are worse off financially since Trudeau took office.

Additionally, a January poll showed that 46 percent of Canadians expressed a desire for the federal election to take place sooner rather than the latest mandated date in the fall of 2025.

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