High energy prices hit wallets across N.W.T.
Last Updated: Monday, April 28, 2008 | 10:09 AM CT
CBC News
The rising costs for fuel and oil are eating into the finances of residents and governments in the Northwest Territories, increasing their power bills and forcing them to pay more to fill their furnaces.
The cost of heating oil, an essential commodity in northern communities, has risen by 28 per cent over the past year, with consumers in the N.W.T. estimating that they're paying around $200 more per month this year compared to last year.
That rise in heating oil costs is higher than any other consumer good, including gasoline and electricity.
After paying the higher heating bills, residents — and even the territorial government — say they find themselves with little money left to spend on ways to reduce their oil consumption, such as buying wood pellet stoves and newer furnaces.
"That takes some investment, so we've got to find that money from somewhere," Premier Floyd Roland told CBC News.
"In our existing situation … the pot of money isn't growing as fast as our expenditures. So there's pressure on departments to find money from elsewhere."
Two years ago, the N.W.T. government found money for a pellet boiler at the North Slave Correctional Centre. A private company installed the boiler and now operates it for a share of the cost-savings.
The City of Yellowknife is now installing a pellet boiler for the Ruth Inch Pool and Community Arena, largely using federal and territorial government funding. City officials expect the boiler to pay for itself within two years.
The new boiler is part of Yellowknife's community energy plan. More than 10 years in the making, the plan identifies ways that the city can reduce its energy usage, which is currently costing the city $600,000 a year on heating alone.
"There's a lot of thought going into what to do about this, and there's a number of options: you can increase taxes or you can decrease the amount of programming that you're doing," said Mark Henry, the city's energy co-ordinator.
Western Arctic NDP MP Dennis Bevington, who helped draft a territorial energy strategy before being elected to Parliament, said individual N.W.T. residents need help to lower their energy costs.
"There's almost a territorial imperative to find solutions for people, to get the cost of energy down for people," he said.
"Otherwise, we're going to be plagued with a declining population, and that's not healthy."
Fuel is not the only energy expense on the rise. Electricity costs have also gone up in the past year, with recent figures from Statistics Canada showing people in Yellowknife are paying 23.5 per cent more for electricity this year than last.
That increase is partly responsible for a 3.2 per cent hike in Yellowknife's inflation rate between last March and this March.
"In the instance of Yellowknife, we saw that there were two large increases within the 12-month period that [that] increase of 23.5 per cent encompasses," Statistics Canada analyst Paul Labelle told CBC News.
General electricity rates have not increased since 2005. Instead, companies are passing on high oil prices to consumers, said Jeff Barbutza, manager of Northland Utilities in Yellowknife.
"Primarily what's driving it is the higher purchase cost of fuel," Barbutza said. "Like anything else, I'm sure it's primarily inflation, just the higher cost of doing business in the Northwest Territories."
Barbutza took an average electricity bill, from a household using 700 kilowatt-hours a month, and said such a bill cost $166 this February, compared to $135 in January 2007.
And more increases could be on the way: Northland Utilities is applying for a general rate increase with the territory's public utilities board. If approved, power rates would go up around 3.1 per cent per year, for three years.
