Alberta's Deregulated Electricity Market Leads to Soaring Summer Bills, Spurring Calls for More Oversight

This summer, electricity prices in Alberta's deregulated market surged, with some Albertans seeing their bills double. Prices reached up to 33 cents/kWh, far exceeding the typical 7-10 cents/kWh.
The high prices are due to insufficient capacity, market power concentrated among a few companies, increasing AC usage during heat waves, the war in Ukraine raising natural gas prices, and a lack of incentive to maintain standby power plants.
Research shows regulating the market, like through long-term contracts and cost-based pricing, could prevent companies from exercising market power to raise prices.
The government temporarily capped prices and provided rebates, but these have expired, leaving consumers to pay off the $200 million debt and deferred costs.
Switching to fixed electricity contracts can lower bills, but isn't an option for all, so there's a role for government to protect low-income Albertans from the volatile deregulated market.

theconversation.com

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Posted 9/13/2023, 9:53:16 PM