Why your natural gas bill may seem higher than usual this month
Enmax spokesperson explains what's behind the spike
Next time you open your natural gas bill, get ready for potential sticker shock.
Alberta's new carbon levy is being tacked on for the very first time this month. But that's only a small portion of the charge, according to Enmax.
To help Albertans decipher those line items on an invoice, Enmax spokesperson Doris Kaufmann Woodcock appeared on The Calgary Eyeopener Monday.
Below is an abridged version of her conversation with host David Gray.
Q: So the January residential bills are starting to arrive. Can you give me a sense how much of an increase Calgarians are seeing?
A: We've certainly seen an increase in calls to our customer care lines from people who are concerned about what appear to be much higher bills. However, about 80 per cent of this increase can be directly attributed to the extended and extremely cold temperatures we've experienced this winter. In fact, back in December, some new electricity use records were set for the province. On top of that, what makes these increases stand out even more is we also had a very mild November, so people saw a sharp increase to their bills.
Q: To be clear, the increases are to natural gas, and not electricity?
A: Yes, but keep in mind, although your furnace burns natural gas to generate heat, it is run by electricity, so your costs are really impacted on both fronts. As for what accounts for the other 20 per cent, it includes things like a general increase in the cost of natural gas over the last few months, but most people are on a floating rate for their gas and these costs always fluctuate, so they'll go down as well. Also, the number of days on a bill can vary because of our meter reading cycles, which is because of a manual process. We can be impacted by things like weather and holidays. There's also a recent retroactively approved increase to the electricity admin charges by the Alberta Utilities Commission. But lastly, there is, of course, a brand new charge on people's bills — the carbon levy, which people have heard of.
Q: How much of a difference is that making?
A: It's actually not as much as what most people think, but we are getting lots of questions from customers as they're really trying to wrap their heads around it. We're hearing things like, 'What does this mean for my bill? How much is it going to cost me every month? Should I try to reduce my consumption to counteract those costs?' But here are some basics on what this really means to residential customers. Firstly, the carbon levy is only being applied to your natural gas consumption, not electricity use. For now, this means that on top of the costs you pay for the gas itself, an additional $1.011 will be charged for every gigajoule of natural gas you use, and this is going to increase to $1.517 per gigajoule in 2018. Given that an average Alberta house uses about 120 gigajoules annually, most households can expect to pay an extra $120 in 2017, which makes up about three per cent of your bill. And this will rise to about $180 in 2018.
Q: So for your average home, you're talking about an extra $10 to $15 a month, is the carbon tax. Who gets a rebate on that?
A: We don't take care of administering that at all. It is a charge that is passed on to the Government of Alberta and they have set those parameters.
Q: Can you explain why both fixed and variable delivery charges have gone up?
A: For natural gas charges specifically, think of it as having three components on your bill. In the first, you're going to see the dollars charged per gigajoule for how much you actually used during the billing period. You're also going to see an administration charge, which is the cost related to Enmax's billing and customer service and a transaction fee. Then we get into the second component, which are the charges passed on to Enmax, or any retailer for that matter, by the default natural gas provider for your area. In Calgary, that's ATCO. They include the fixed charge, which is regulated by the Alberta Utilities Commission, and are literally the gas provider's cost to build and maintain the distribution system. This is a daily charge, so it goes by the number of days billed, but not your usage. The variable charge, on the other hand, which is their cost to operate the distribution system, is charged relative to your actual consumption of natural gas, so that's where you do see changes on those charges.
Q: It appears the fixed charge went up. How can it do that when it's a fixed charge?
A: It goes a little bit back to the number of days billed in a particular cycle. Again, we are impacted because it's a manual process to be reading meters, by things like weather and holiday schedules.
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With files from The Calgary Eyeopener