Hydro Quebec seeks permission to hike rates by 5.8 percent
Hydro Quebec is asking for a 5.8 percent rate increase.
The Canadian Press
Published Friday, December 6, 2013 4:01PM EST
Hydro-Quebec wants to slap its consumers with a massive 5.8 percent rate increase starting on April 1, 2014.
On Friday the coroporation launched its quest to persuade the Quebec Energy Board for permission to do just that.
The increase consists of two components, Hydro-Quebec President Daniel Richard explained, one being a straight up 3.4 percent rate hike and the other 2.4 percent to increase its rate of return.
The hikes would result in annual increases of over $120 for customers with medium sized homes and of about $36 per year for customers residing in medium-sized apartments.
Hydro Quebec official Patrice Lavoie later explained that the increases could have been much higher. “This increase would have been much greater had it not been for the efficiency of Hydro Quebec, which helped lower demand by 1.5 percent.”
Hydro Quebec’s president told the board Friday that the corporation reduced its costs through centralization and by decreasing its workforce through attrition, as many retirees were not replaced by new hires.
Nonetheless the request marks the largest increase sought by the Crown corporation since 2006 when the board granted an increase of 5.23 percent.
Hydro also said that the cost of setting up new wind farms and indexing the cost of heritage pool electricity forced them to ask for the 2.7 percent of the total requested in the hikes.
Hydro Quebec expects those wind farms to help them attain an electricity surplus by around 2027.
“Wind is a good source of energy but it’s more expense than hydro power,” said Lavoie."Those costs have put an upward pressure on prices.”
One consumer rights group has already attacked the requested hikes.
“This demonstrates a misuse of the mission of our Crown corporation. The purchase of wind power is a political decision. It’s not for customers to pay for political decisions,” said electricity price watchdog spokesperson Veronique Laflamme.
Hydro Quebec might also propose to reduce the price for removing smart meters, which currently cost $98 to install an alternative as well as an annual fee of $206 to collect data, as the number of consumers asking for that service is decreasing.
Hydro Quebec customers saw their bills rise by 2.4 in 2013, while rates decreased by 0.5 percent in 2011 and by 0.4 percent in 2012.