Utility rates in Penticton are on the rise, though at a slower rate thanks to a five-year plan council voted to implement this week.
Last month council received a report that not only sets out rate increases, but adjusts the balance between commercial, industrial and residential rates, with the goal of helping electrical, sewer and water utilities become sustainable.
Daryl Clarke, plant manager at Cut Technologies, a world-class manufacturer of saw blades, said the gradual amelioration of electric costs is going to make doing business in Penticton easier.
“Before, our rates were going up, up, up compared to Fortis, and now they are going to come down and be in line with Fortis,” said Clarke. The five-year plan shows commercial rates increasing at a slower rate than the 4.1 per cent increase to residential customers.
Andrew McLaren, who authored the report, said that on average, residential customers are likely underpaying on electricity and water rates and overpaying on sewer rates while commercial and industrial customers, on the other hand, are overpaying on electricity and water but likely underpaying on sewer rates.
“I am glad they listened to their consultant. For the next five years, the electric rates in Penticton are going up less than the Fortis rates. It will bring us back in line with it, it will create the contingency funds we need and hopefully we can get on with dealing with infrastructure,” said Clarke. “They are structuring it so it will be sustainable and they are changing the way administration fees are done, so it is not going to be such a cash cow.”
Under the new rate plan, the average resident can expect to see their utility bills rise by $34 from $189 to $223 between 2016 and 2020, while small commercial will increase from $969 to $1,186. Industrial customers will increase from an average $6,257 to $7,287.
Water rates are also expected to rise. The average residential rate is $34, but will rise to $52 in 2020. Sewer rates, on the other hand, will decrease, from $43 to $35.
Director of operations Mitch Moroziuk said the electric rates increases are based on projections of FortisBC’s wholesale rates.
“If we receive a surprise, we would be back to council to talk about that,” said Moroziuk.
Coun. Helena Konanz was concerned that the five-year plan meant council wouldn’t be reviewing electric rates annually.
“I don’t see what is wrong with having it come forward to the public each year. I think it is our responsibility,” said Konanz. “This utility belongs to the people of Penticton, I think it is important that they see what we are doing each year.”
Council also voted to shift billing for water to a monthly basis. Chief Financial Officer Colin Fisher told council the change would give customers the chance to discover leaks or adjust water use in order to avoid higher bills more easily, and hopefully increase customer satisfaction with the service.
Fisher also suggested that staff time spent dealing with customers angry about the irregular charges would be reduced, and possibly avoid situations like the one that caused City Hall to be locked down after a resident, angry at having his power shut off, issued threats.