Qulliq Energy Corp.’s (QEC) latest bid to standardize power rates across the territory won’t be an easier sell than it was in 2014, when Paul Okalik, then minister responsible, cancelled such plans.
The same communities that objected four years ago – Iqaluit, Rankin Inlet, Iglulik, Pangnirtung and Cape Dorset – remain the communities most affected by such a scheme. Those communities would see an increase in their rates.
“The Hamlet of Rankin Inlet, at its council meeting of December 12, 2017, has passed a motion opposing the QEC application to the URRC (Utility Rates Review Council) to implement a territory-wide rate for power usage,” stated the hamlet in a Dec. 14 letter to the council.
The letter was also sent to Rankin Inlet’s new MLAs Lorne Kusugak, now minister of Minister of Community and Government Services, and Cathy Towtongie, and the minister responsible for the corporation Jeannie Hakongak Ehaloak, said senior administrative officer Justin Merritt.
Kusugak was himself the minister responsible for QEC when the council recommended standardization in 2011 – though government deferred the move to 2014. A territorial election in 2013 changed the landscape.
“Basically we said we’re not in agreement with the rates,” Merritt said.
“We also posted on our Facebook page because businesses might be interested in our position.”
The letter also states: “The council feels that as a regional centre for the Kivalliq region that this would have negative economic effects on our community both for business and future job growth.”
The council also believes the move would “decrease incentive for QEC to look at each community in a way to decrease their cost of producing power and this could lead to rates going even higher.”
QEC’s general rate application, the fourth since 1999, is in two parts: it proposes to raise rates by an average 7.6 per over two years to meet QEC’s operational costs, along with standardizing the territory-wide rate over six years.
The corporation says the new rates are required due to a $7 million increase in non-fuel costs, a $4 million increase in capital investments, taking into account a $2 million decrease in net cost of fuel.
“I think people know what we’re proposing is not unfair. I live in Iqaluit, it’s going to affect me as well,” said QEC president Bruno Pereira at a sparsely attended public meeting in Iqaluit Jan. 13.
Pereira and his staff, along with review-council members have toured nine communities – Baker Lake, Kugluktuk, and Cambridge Bay in December, and Pond Inlet, Iglulik, Cape Dorset, Qikiqtarjuaq and Iqaluit in January – said council president Tony Rose.
Standard rates ‘solution to very real problem’
“The City (of Iqaluit) will be asking QEC to make a presentation to council,” said the city’s communications manager Andrea Spitzer. “The city is still examining the proposed rate increase as well as harmonization, to fully understand the impacts.”
Kimmirut is second only to Kugaaruk with the highest rates. While Iqaluit residential customers pay 60.29 cents kilowatt hour (kWh), and Rankin Inlet 62.23, in Kimmirut the rate is 103.74 cents. In Kugaaruk the rate is 114.16 cent/kWh.
“It hasn’t come up in council yet, but I’m expecting it to,” said Kimmirut senior administrative officer Kimberley Young, adding the community would absolutely like to see the rate standardized.
“That would benefit us greatly.”
QEC’s six-year plan would bring rates to 78 cents per kWh across the board.
Nunavummiut have until Feb. 2 to have their say on the Qulliq Energy Corp.’s general rate application. Any new rates would take effect April 1.