A rate increase with little impact on Yukoners’ bills
Yukon Energy Corporation is taking an innovative approach to its proposed 2021 rate increase. If supported by the Yukon Utilities Board (YUB), the rate increase could end up increasing the average Yukon residential bill by about 70 cents a month — or less than the cost of a cup of coffee.
“As a regulated utility, Yukoners pay what Yukon Energy pays to plan, build, operate and maintain Yukon’s power generation and transmission assets,” said Yukon Energy President and CEO Andrew Hall. “When significant investments are needed to meet growing demands for power, electricity rates must go up to help pay for those investments.”
The corporation’s General Rate Application (GRA) outlines over $55 million in investments the Corporation expects to make between 2019 and 2021. It asks for an 11.5% rate increase in 2021. This equates to 3.8% a year between 2019 and 2021. The application also outlines a way the rate increase can be implemented so that the impact on Yukoners’ monthly bills is closer to 0%.
“What we’re proposing is a “nearly 0” rate increase,” said Hall. “It’s a way for us to make the investments we need to replace aging assets and meet growing demands for electricity, while providing some bill stability for Yukoners, especially those on a fixed income.”
“Our Board of Directors recognizes that paying more for electricity can be hard from some Yukoners, especially during the COVID pandemic. That’s why we’ve worked hard to find a way for the rate increase to have little impact on electricity bills.”
The increase comes as Yukon Energy is faced with two major challenges. First, peak demands for electricity continues to grow. Between 2018 and 2020, peak demands for electricity increased by 17%. Yukon Energy expects peak demand to rise by another 40% by 2030. Second, Yukon’s electrical system is aging and requires repairs, upgrades and replacement. Supporting future growth will require refurbished infrastructure and investments in new renewable and reliability projects.
With its legacy assets, the company finds itself in circumstances similar to that of homeowners. As their families grow, their original home may require an addition. And as the house itself ages, it requires major repairs like a new roof or furnace.
“Our house is over 60 years old,” said Hall, “and it needs significant work, and an addition or two.”
Yukon Energy’s proposal, subject to support from YUB, is to phase in the proposed 2021 rate increase when two other charges currently on electricity bills are planned for removal next year. If all goes according to plan, the first phase will be in July and the second in December of 2021.
“Our ultimate aim is to make the investments needed to support future growth with renewable and reliable sources of electricity, while minimizing the impact to Yukoners’ monthly electricity bills.”
Yukon Energy submitted its rate increase proposal to the Yukon Utilities Board on November 20, 2020.
Yukoners may view Yukon Energy’s rate application, and register as an intervenor or interested party at yukonutilitiesboard.yk.ca. A public information session about this rate application is being planned for early 2021. Yukoners can visit https://yukonenergy.ca/customer-service/rates/2021-rate-application/ or follow Yukon Energy on Facebook or Twitter for more details.