A proposed increase in electricity rates announced Friday by the state-owned Saskatchewan Utility Corporation will likely lead to higher costs in other aspects of consumers' lives, a policy expert says.
“When you increase your electricity bill, you increase all other costs. So your food costs will go up, your driving costs for certain vehicles will go up,” said Ken Coates.
On Friday, SaskPower announced it would raise electricity rates by 3.9 percent both this year and next.
This rate increase is expected to cost the average customer approximately five extra dollars per month starting February 1st.
Farm customers can expect a higher monthly cost increase of about $11 more each month.
SaskPower owes the rate increases to capital investment and ensuring the reliability of the province's electricity supply.
“In the coming years, SaskPower will continue to upgrade its fleet of coal-fired power plants, expand transmission and distribution systems, and modernize the provincial power grid,” SaskPower said in a press release on Friday.
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Last December, the government announced that the utility corporation faced a $292 million revenue shortfall due to the removal of the federal carbon tax from residents' bills.
Coates says it makes sense that the government is looking for balance given the decline in revenue.
“If you lose income, on the one hand, you have to make up for it somewhere,” Coates said. “But it’s also true that our demand is growing very sharply.”
Coates also notes that the rate increase will likely impact some residents more than others.
“We need to be much more aware of the fact that around the world growth does not affect everyone equally. That poor people suffer very seriously. While someone richer, it's like water off a duck's back,” he said.
The Official Opposition is calling on the government to address rising costs across the province, asking the government to hold a special legislative session before the spring sitting to pass measures to improve affordability.
“We don't have to sit in the legislature for another two months, but the people of Saskatchewan simply cannot afford to wait,” Saskatchewan's official Opposition Leader Carla Beck said at a news conference Monday.
“Let's go back to the session. Let this government show some responsibility for the decisions taken.”
In a statement Monday, the government defended its affordability measures, such as removing a carbon tax from energy bills and increasing tax credits, and also took aim at Beck's participation in legislatures.
“All of these affordability measures have been discussed extensively in the Assembly. If the NDP Leader had appeared more frequently in the House, she would have known that the government continues to make affordability a priority and is working to ensure that Saskatchewan remains the most affordable place to live in Canada,” the Government of Saskatchewan said in a statement.
SaskPower isn't the only Crown corporation proposing a rate increase: SGI, the province's Crown insurance corporation, also announced an increase on Friday.
SGI is looking at a two-year rate increase of 3.75 per cent, which will take effect in June and is expected to cost about $38 more per year for almost all Saskatchewan vehicles.
While both rate increases are now in effect, they are subject to a public review by the Saskatchewan Rate Review Panel, which is expected to conclude this summer.
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