Utilities board considers N.W.T. rate increase

The Northwest Territories Public Utilities Board will consider part of the General Rate Application from the territory’s energy company.

The board received an application from Northwest Territories Power Corporation on Friday.

It wants to increase power rates by 26 per cent over a four year period.

Yellowknife business owner Matthew Grogono is startled by the size of the proposed increase.

"That I think is shocking, but using power it's got to come from somewhere and it's time we start accounting for that cost, and users have to start paying for what they're using"

The utility had hoped to get an approval for April 1.

However, the board must still conduct public hearings.

So the board is proposing holding hearings in Yellowknife this week on the first year’s increase of 7 per cent.

The board would then conduct further hearings on the remaining proposal.

The minister responsible, Michael Miltenberger says the rate increase needs to be big because of increasing costs.

"I mean this is the first one in five years and it speaks to the need for the regulatory reform that we’re also going to be proceeding with, so that we can avoid this type of rate shock by not having an increase in five years." Miltenberger said, "We would’ve had an inflationary increase every year.  It would have been a couple of per cent and it wouldn’t have been that big a shock."

An N.W.T. Power news release said the increase is justified because diesel costs have gone up 57 per cent since its last rate application, its infrastructure is aging, a smaller gas supply than expected means they must convert Inuvik residents back to diesel, and operating costs have gone up within a more competitive labour market.

The territorial government is putting up $33.8 million over three years to help cushion the shock.

The Government has already eliminated nine jobs at the company.

Miltenberger says they've also changed the bonus structure to save money.