Calgary homeowner 'shocked' by utility bill of more than $1,200

While there are multiple reasons for rising home energy bills, some Albertans say there are many other increasing expenses that are straining and "shocking" households.

Cathy Reitz' home was built over 60 years ago and says her recent utility bill from ENMAX was $1,240 (with a credit of $200) is the highest bills she's received in 13 years of residing in the Bowness home.

"Over $1,000 on an energy bill is shocking. Absolutely. It's shocking. It is almost more than our current mortgage payment," said Reitz.

She says opening up the bill felt overwhelming – she expected it would be closer to $600.

"You start thinking, ‘What did I do wrong?’" said Reitz.

Her electricity bill alone rose from $140.86 in January 2021 to $284.52 in February 2022 – effectively doubling in one year.

Reitz says her family makes sure their home is energy efficient with insulation and installing new windows and a roof.

She adds the compounding effects of rising bills and her cost of living is a major strain.

"We're gonna have to make some changes, because you still have to pay your bills, you still have to pay your mortgage, you still have to eat and you still have to fuel up your car."

Statistics Canada reports the annual inflation rate has risen to 5.1 per cent in January compared to a 4.8 per cent gain in December 2021.

The consumer price index rose 4.3 per cent year-over-year in January 2022.

Gas prices are also up nearly 32 per cent nationwide in January compared to the previous year.

MORE THAN SUPPLY AND DEMAND

One Calgary economist and researcher says rising energy bills are due to a variety of factors in addition to frigid winter weather and the rules of "supply and demand."

"Here in Alberta, you can choose both who you want to pay to, but also how you want to pay; fixed or floating," said Blake Shaffer, associate professor of economics at the University of Calgary.

Shaffer says roughly half of Albertans are on a floating payment plan which fluctuates with market forces.

He says demand is about three per cent higher in 2021 over the year before with more people at home in the pandemic amid work-from-home orders.

Natural gas, the primary electricity generator in Alberta, is also experiencing continued high commodity prices about 50 per cent higher than in 2020.

The carbon tax has increased another $10 per tonne which is a cost borne by natural gas power plants.

Shaffer also adds that "power purchase arrangements" ended in late 2020 which transfers control of some power plants to a smaller more concentrated group of owners, leading to a significant increase in power prices.

He says all these market forces could take until April 2023 to dissipate, and recommends that Albertans lock in with a fixed rate billing system or risk expensive bills

"For at least another year, it looks like fixed is the way to go," said Shaffer.

Alberta’s associate minister of natural gas and electricity says is recognizes the financial pressures facing Albertans, and says market demands are outside of government control.

"In addition to seeing record-breaking demand this winter, a large amount of the historically low-priced coal power has been retired from the system. This shift in our electricity supply mix is also contributing to higher-than-average prices. This is a signal to investors that new generation is needed and the market is responding with approximately 40 generation projects underway offering 4,000MW of new supply to the grid in the coming months and years," said Dale Nally in an email statement to CTV News on Wednesday.

He adds his ministry consistently meets with stakeholders.

"Consumers can shield themselves from volatile energy prices and I encourage everyone to understand which competitive product is best for them. These options include fixed price contracts, equalized payment plans or the floating regulated rate. Unlike many other contract-based products, utility contracts in Alberta are easy to access and easy to cancel in a short time-frame," said Nally.

He added thats Utilities Consumer Advocate is an available resource for Albertans to contact.

CTV News also reached out to various utility providers and heard from Direct Energy with a statement:

"Energy prices have been higher as a result of supply shortages, and colder-than-normal weather. When the temperature drops, energy consumption rises. These factors combined have resulted in higher energy bills for many Albertans.

Additionally, we do offer fixed price contracts for both natural gas and electricity that protect consumers from volatile prices. We also allow our customers to change their natural gas and electricity plans anytime without fees.

We have been meeting with industry stakeholders, and we are working with the government to determine solutions that support customers. We understand some customers may need help to manage their bills and, where possible, we offer flexible payment arrangements and other billing options, such as equalized billing."

REBATE PROMISED IN THE BUDGET

There is some relief for natural gas costs on the horizon, Premier Jason Kenney said Wednesday. He made comments suggesting that a rebate for Albertans is on the books for the coming budget.

Kenney said the impetus for such a decision was the federal carbon tax, something his government attempted to fight in court. The Supreme Court of Canada struck down the province's most recent argument, but he said his government is still opposed to the levy.

“We would renew our call on the federal government to drop their punishing carbon tax all it does is make it more expensive to heat your home to use electricity and I think this is irresponsible and incentives at a time when Canadians are struggling to cover the cost of inflation and particularly when it covers heating and electricity."

However, he did not get into details about how much money Albertans could see back in their wallets.

Further details are expected to be released next week.