Panel releases recommendations on SaskEnergy 2022 Rate Application
The Saskatchewan Rate Review Panel (the Panel) has recommended that the provincial government maintain SaskEnergy’s commodity rate increase of 31% and the 8% increase in delivery rates both implemented August 1, 2022, but the proposed delivery rates increases of 5% for each of 2023-24 and 2024-25 cannot be considered until further updated financial forecasts are provided by the corporation in February 2023.
The Panel is recommending that the effective date for the proposed delivery rate increase for 2023-24 be deferred from June 1, 2023 to July 1, 2023; and for 2024-25 be deferred from June 1, 2024 to July 1, 2024 to provide the Panel with a sufficient review period to consider the required updated financial information from the company.
The Panel has also recommended that since the Gas Cost Variance Account (GCVA) is forecast to be discharged by April 2023, SaskEnergy should make an application to the Panel at that time to reduce the commodity rate. The GCVA is a mechanism to track the difference between the commodity sales revenue that SaskEnergy collects from customers and the actual costs that it pays for the gas. When actual gas costs exceed the amount recovered from commodity rates, balances accumulate in the account that are later collected from customers. When actual gas costs are lower than the amount recovered through commodity rates, balances owing to the customer are accumulated and refunded through future commodity rate adjustments.
The Panel made several recommendations to SaskEnergy ranging from greater transparency regarding transportation and storage rate increases to increased collaboration with other Crown corporations to enhance productivity and efficiencies.
The Panel’s recommendations, which follows a review of the application and other documentation, as well as input from the public, is consistent with the analysis and recommendation made by the Panel’s independent technical experts.
A complete copy of the Panel’s report and the independent technical consultant’s report are available on the Panel’s website at www.saskratereview.ca. The site also contains the original rate application, SaskEnergy’s public presentations, the Panel’s terms of reference, information requests to SaskEnergy and the responses, videos of the public meetings, public submissions and comments, and the Panel’s media releases.
The mandate of the Panel is to review the application and provide an opinion on the fairness of the rate adjustments requested, considering the best interests of the customer, the Crown corporation, and the public. The Panel believes these recommendations represent a fair balance impacting the affected parties. These recommendations to the Minister will be reviewed by the government and a final decision on implementation will be made by Cabinet.
For more information please contact Albert Johnston, Chair of the Saskatchewan Rate Review Panel, at 1-877-368-7075 (toll free) or (306) 934-1948 in Saskatoon.
