The Opposition’s sustained attacks on the Kenney Government for removing the NDP’s cap on electricity price increases must be hitting the mark with voters worried about the cost of utilities and inflation generally. 

Opposition NDP Energy Critic Kathleen Ganley (Photo: David J. Climenhaga).

How else can we explain the UCP gas and electricity associate minister’s attempt yesterday to blame the NDP’s policies while it was in government for electricity price surges now being experienced by Albertans?

At a news conference, Dale Nally trotted out a previously unmentioned year-old report by a management consulting firm to try to blame the NDP for the loss of $1.34 billion by the province’s balancing pool, an agency created in 1999 to keep consumers’ utility rates lower when market-driven price spikes resulted from the Conservative government of the day’s deregulation of the utility industry.

The losses were posted when utility companies terminated contracts after the NDP government imposed a carbon levy on coal-fired electricity-generating plants. 

So Mr. Nally claimed current high electricity prices, a portion of which go to restoring balancing pool funds, are the result of “the former government’s ideological agenda.”

Never mind that the balancing pool, the workings of which are pretty hard for normal mortals to understand, was part of a lousy deregulation scheme created by a previous Conservative government to, as NDP Energy Critic Kathleen Ganley put it yesterday, guarantee utility corporations’ profits “by tying the hands of government and exposing Alberta taxpayers to unreasonable risks.”

University of Calgary economics professor Blake Shaffer (Photo: University of Calgary).

And never mind also that only the day before Mr. Nally’s news conference a study released by the University of Calgary’s School of Public Policy, which is not exactly a nest of Marxist hotheads, concluded that by far the biggest factor in Alberta’s current soaring electricity rates is large utility corporations charging more for electricity. 

“The things that are getting a lot of attention, like the change in the natural gas price and the carbon price, have had a pretty modest impact,” one of the study’s authors, U of C economics professor Blake Shaffer, told the Calgary Herald.

As Ms. Ganley bluntly explained it, “the real reason for these price spikes is due to electricity companies marking up the price of power and gouging Albertans who are already struggling to make ends meet.” 

Power companies’ profits have increased five-fold as a result, she noted.

“The UCP left Albertans vulnerable to these steep increases by removing the NDP-era rate cap on electricity prices,” Ms. Ganley argued. 

Alberta Premier Jason Kenney (Photo: Alberta Newsroom/Flickr).

Even if the loss could be blamed on the NDP’s environmental policy, complaining about it would be pretty rich for a government that started its term in office with a $4.7-billion tax cut for wealthy corporations, misplaced $1.6 billion through lousy accounting of its energy policies, and gave away at least $1.3 billion on a bad bet that Donald Trump would win the 2020 U.S. presidential election and allow the Keystone XL Pipeline to the Gulf Coast to be completed. 

Alert readers will recall that’s not how things worked out in November 2020. 

Under those circumstances, it bordered on the unintentionally hilarious for the government’s news release to quote the president of a business bigshots’ advocacy group saying “every dollar paid for by Alberta ratepayers needs to be treated with respect and restraint.”

Mr. Nally, the MLA for Morinville-St. Albert, hasn’t seemed like the sharpest knife in Premier Jason Kenney’s cabinet drawer since his 2020 meltdown at St. Albert MLA Marie Renaud for daring to criticize the UCP government’s rollback of LBGTQ rights for students during a Pride flag-raising ceremony at St. Alberta City Hall. 

St. Albert NDP MLA Marie Renaud (Photo: David J. Climenhaga).

But he can’t be blamed for yesterday’s idea, which clearly came straight from Premier Kenney’s strategic brain trust – whose members may be feeling a bit as if they’re on the ropes along with their boss as the party vote on Mr. Kenney’s suitability to remain premier continues.

Certainly Mr. Nally can’t have been responsible for the government’s almost incoherent news release, which tried and failed to explain the opaque operations of the balancing pool in a way that makes the UCP Government look as if it’s good for another term in office. 

Despite Mr. Nally touting the “independent” audit by the Canadian arm of the controversial U.K.-based Deloitte consulting firm, completed last March and left on a shelf since then, his department says it needs more time to analyze the report’s results. As of yesterday, Mr. Nally’s staff didn’t seem to know how much the Deloitte report cost, either. 

Meanwhile, Ms. Ganley called yesterday’s news conference nothing more than an effort to distract Albertans from the fact the UCP can’t seem to get anything done about its promised rebates for electricity and natural gas bills, which are not expected to be paid for months. 

“Albertans can’t trust the UCP to get to the bottom of the mess they made,” she said in a statement. “We need a full public inquiry to determine why Alberta families and businesses are paying so much more for utilities under the UCP.”

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20 Comments

  1. Yeah, I don’t think blaming today’s rising electricity costs on a party that hasn’t been in power for several years is going to convince many voters. At this point, the UCP will be held responsible for such things, by everyone except their most hardcore supporters.

    It also probably doesn’t help their case that they were the ones who removed the caps on price increases, got rid of the previous system and told everyone how great it would turn out. Well, it hasn’t turned out great for power users so far and it is not looking any better in the foreseeable future.

    However, the UCP will likely keep on spinning such desperate tales. Maybe if they repeat them often enough they will actually believe them. However, it is going to do nothing to improve their tenuous credibility and image with Alberta voters in general. I am pretty sure governments are elected to do things to solve problems, not point fingers at others. With or without Kenney, at this point the UCP is in a very deep hole, yet all they seem to want to do here is keep digging.

  2. The UCP are so good at misleading Albertans, and are blatantly lying if they want to think that the NDP are responsible for making power bills, and utility bills in Alberta so costly. Who are they trying to fool? They are fooling many Albertans, but they certainly aren’t fooling me. I’ve been around the block many times over. I remember Ralph Klein shoving the merits of electricity and utility deregulation down the throats of Albertans. He had two cabinet ministers, Steve West and Murray Smith, aiding him in this. Ralph Klein and Steve West were trying to say that power prices in Alberta would instantaneously go down, right after electricity deregulation in Alberta occurred. That didn’t happen. Instead, Albertans got the shock of their lives on their power bills, and the cost of power went up rapidly. Ralph Klein conceded that electricity deregulation would never make power prices in Alberta go down. Electricity deregulation has also come with a very hefty cost for Albertans. If you combine the electricity deregulation and the PPA (Enron Clause) shenanigans by Ralph Klein, this is exceeding $40 billion, by this point in time. Ralph Klein also was remarking that he didn’t even know what the contracts relating to the PPAs meant. The Enron debauchery in the USA is connected to electricity deregulation in Alberta. There were talks about “screwing Alberta good.” They certainly succeeded in that, and Alberta power consumers were shafted. Stephen Mandel, a former mayor of Edmonton, was blowing his stack off in 2010, and in 2011, because there were sudden power outages, with no reasonable explanation behind them. He was right on that. TransAlta was doing dirty tricks to alter the price of power in Alberta, with these instigated shut downs of power plants. It took a few years, and they were deemed guilty and slapped with a fine in the mid $50 million range. The Alberta PCs never reimbursed Alberta power consumers for this, and they just socked the money away into provincial government coffers. What did TransAlta do as a result of this? Make us power consumers in Alberta pay for TransAlta’s highly unethical antics. The head honcho of the UCP also was in the CPC cabinet, and had a colleague, Jim Prentice, (the one who said that Albertans should take a look in the mirror). As far back as 2008, Jim Prentice, then being the CPC’s environment minister, had been saying that coal fired electricity generation plants in Canada were a contributing factor to air pollution and GHG emissions, and he said that they had to be shut down by 2020, or sooner. When Jim Prentice was premier of Alberta, he also was aware that coal fired power plants in Alberta were also a major source of air pollution, and GHG emissions, and he, along with his environment minister, Robin Campbell, wanted coal fired power plants in Alberta shut down. Robin Campbell forgot that he agreed with Jim Prentice on this, and is now the President of The Coal Association of Canada, and is touting the virtues of coal. Progress Alberta, as I recall, wanted Robin Campbell taken to task for his flip flopping, and also the obvious conflict of interest. The UCP have eliminated the NDP’s cap on what we are paying for our utilities and power in Alberta, causing more grief with higher costs for these things. In an effort to try and save their hides before the next election, Albertans will get a measly $150 to try and lessen the impacts of surging power prices in Alberta. The UCP aren’t smart if they are blaming the NDP for rising power and utility prices in Alberta. I’ve also heard people mentioning that there were MLAs under Peter Lougheed, and they said that electricity deregulation was a very bad thing to do. Albertans have been duped by these pretend conservatives and Reformers in the UCP.

  3. The UCP’s tax cuts for corporations is likely closer to $10 billion. I’ve heard that figure mentioned. It was supposed to boost employment in Alberta, and that never occurred. The UCP were assuming that the big orange man would still remain president of the USA, has cost Albertans $7.5 billion, and likely more, with that pipeline. There is $6 billion in loan guarantees that no one knows what happened to. The UCP shouldn’t be talking about how money is being misused, because they have a knack for doing it so well. Billions of dollars have gone down the drain from the UCP’s very pricey shenanigans. Pretend conservatives and Reformers always have a problem with being fiscally wise. We also have to look at how Ralph Klein made it so that Alberta is out $575 billion, because he thought it was okay to reduce the oil royalty rates of Peter Lougheed to nearly zilch. Ralph Klein also thought it was okay to be slack with enforcement of oil companies to fix up their damages, and Albertans have to ante up $260 billion for this. When Albertans are easily fooled by this, we never end up being better off. Then these pretend conservatives and Reformers think it’s someone else’s fault. After this, come the cuts. The public education and healthcare systems in Alberta suffer, as does infrastructure, and anyone on AISH, or retired folks does too, due to the worst austerity, which was totally avoidable. This doesn’t make any sense at all, but it seems that Albertans are gluttons for punishment, so this is what they get.

  4. It all goes back to the 1990s when the public utilities sector was broken up in Ontario and Alberta for ideological neoliberal reasons, and separated into Generation, Transmission and Distribution in the electrical sector. No reason whatsoever to do it except to make money for a few. The very worst case of this utter nonsense happened in the United Kingdom, and that started it all — there, some old dear living on the South Coast opposite France could theoretically buy her electricity from Scottish Power. At the time I was involved in electricity metering and knew for a fact there was no technically feasible way to correctly meter such a scenario through multiple company interchanges. It was in fact stupid Thatcherism, no more, no less, from people without the first clue about any thing whatsoever technical. Mere “market-driven” ideology for its own sake.

    Alberta wasn’t so bad, being a way smaller market. But, when you have salesmen from different “utilities” trying to sell you your electricity for your home, you know you’re being ripped off. Having a layer of know-nothings hawking a public service from different “retailers”, each with their own overheads, is a layer of employees and cost that is simply not needed or required. The result is increased cost for no valid reason whatsoever and moreover is highly inefficient. Except to generate income for parasitic entities, of course, for doing nothing productive. Rather like the totally lame Con idea of raffling off public services to the private sector to administer. To “beat” the government “cost” (whoever determines that) and prove “efficiency”, the privateer pays its employees less in order to have lots left over for luvverly profit for doing diddly squat except to exploit labour. But in Alberta, people seem brainwashed into believing private is more “efficient” no matter what. It certainly is more efficient at vacuuming up public funds and depositing them safely into private hands.

    I’m not familiar with the exact nature of the BS Alberta trapped itself with by going “market-driven” in public utilities. It’s so off the scale of ridiculousness for a sane person to grip it’s not funny. A regulated monopoly with a Public Utilities Commission to keep tabs on rates is all that’s required. Not a miasma of unproductive leeches making a commish on every little transaction from producer to consumer. Works everywhere else where the the PUC is given appropriate power to set rates by legislative act, and by having but one main generation, transmission and supply entity whether it be public or privately owned earning a regulated return.

    Good luck sorting that mess out you have in Alberta. No matter which political party one is speaking of, it’s highly unlikely any of them have a real grasp on what’s going on. Obfuscation by complication conceals all the “deals” in operation.

    1. When Ralph Klein deregulated utilities, I was renting a house that was built in 1908 in the community of Mission in Calgary. My heating bills went from an average of $40.00 per month, to $400.00 per month. I guess everyone thinking it was a good idea were either brainwashed Conservative Clones or the had investments in Energy Companies.

  5. I love watching the associate minister and others squirm. That begs the question, why have the UCP not done anything on this file yet. They keep blaming the NDP, but almost three years in that excuse (for everything) is wearing thin. Especially when they have a report sitting on the shelf collecting dust for a year. The way I figure this is the electricity, gas, insurance companies are making hay when the sun is shining, because they see the easy obscene profits they make could come to an end soon. Not soon enough for me though.

    1. !? Thanks for posting that it proves what I have been thinking all along . My late father was a Power Plant Engineer and everything he told me would happen under deregulation has happened. He was furious with Klein for even considering it. One of Lougheed’s MLAs told me that it was the dirtiest trick Klein could have played on the Alberta people, just think what it’s done to our health care and education costs and what it’s going to do to low income seniors . Alberta and Ontario are the only two provinces that were dumb enough to try it even though it was proven that it doesn’t work.

      Since Kenney took the caps off the industry that Notley put on to protect the people from gouging by the industry, the industry is now free to do just that and they are trying to make up for what they lost under the cap and are screwing as many people as they can , as fast as they can and it’s created a nightmare for many of our seniors , but Kenney doesn’t care. A former employee for Epcor warned me that Kenney was letting this happen and I should have taken his advise and purchased a fixed rate plan. Once again we see reformers helping their rich friends screw the people out of their money while they give away hundreds of billions of dollars in oil and tax revenues to benefit their rich friends, trying to use taxpayers money to buy votes.

    2. I have a PDF from 2016, by Fellows, Moore and Shaffer, titled THE CHALLENGE OF INTEGRATING RENEWABLE GENERATION IN THE ALBERTA ELECTRICITY MARKET.

      Not sure if that’s the one you mean, and I don’t see a way to attach it to a reply here. DJC, if you’d care to post this report from 2016, please email me.

  6. It’s a little more than just a coincidence that whenever the UCP somehow manages to flush money down the drain, including on some vote buying gimmick, or by losing it somehow, or from one of their very costly shenanigans, they come up with some pathetic excuse as to why they are short of money. Somehow, Justin Trudeau’s Liberal government, or Rachel Notley’s NDP government are to blame. This shows that the UCP are far removed from reality.

  7. For the life of me, I have never understood why people act as though Conservatives are responsible managers of the public purse. I was born in 1981 and I’m pretty sure the “best” manager of the economy produced in Canada or America who was a Conservative would be Reagan, who I think was an absolute disaster because Neoliberalism is good for nothing but allowing a wealthy elite to pillage society.

  8. The UCP messaging has usually been incompetent, unprofessional, or both. Except for Blaise Boehmer, the quality of Kenney’s UCP staff, starting with Matt Wolf, to handle government communication has been low quality.

    Most Albertans, as you point out DJC, will either not understand the complexities of the balancing pool or will be unwilling to expend the mental energy to figure it out.

    But, Albertans do see the increases to both their power and insurance bills. They also will find it a lot easier to understand the direct causal connection to UCP policy decisions and the increase in those bills. To blame it on an esoteric and complex mechanism such as the balancing pool does indeed smell like desperation, if that is the only thing the UCP communications staff can produce to counter the factual narrative.

    It is not just the UCP government that is responsible for high power rates — the fact that there is no Alberta advantage for power rates, that we pay higher rates than other provinces, even though we are an energy resource rich province is the fault of both the UCP and previous PC governments, and Ralph Klein’s government in particular.

    This is what happens when you socialize debt and privatize profit by giveaways to corporations at the expense of the taxpayers. The PC and the UCP governments have been enriching their corporate friends for years through policies that ultimately hurt their own citizens.

    Utilities should be either publicly owned or highly regulated to avoid price shocks. What do people think is going to happen when you take away the controls that are designed to ensure that private corporations do not gouge their customers for a necessary service? Private corporations are going to gouge their customers. They care only about their profits and not about their captive customers.

    The UCP and the previous PC governments are willing and eager partners in this grift. The result is that they make life more expensive for all of us.

  9. The U of C’s School of Public Policy showing that electrical generators are gouging the public is really a “water is wet” type of study – accurate, but painfully obvious. Previous to Klein, Alberta had a “Public Utilities Board” that audited the electrical companies each year. When they exceeded a set rate of return on investment, the PUB forced them lower power rates to consumers the following year. This was the reason Alberta enjoyed cheap electricity and a reliable grid for decades.

    But that was in the days when we had a government and bureaucracy that more often than not, operated in the public interest. Now we have a stupidly over-built and expensive grid that is inappropriately designed, and highly fragile, delivering electricity that is over-priced.
    You need only take a deep breath to smell the stench of ENRON still lingering in the room to know where all this came from.

  10. Putting aside the fact that most of the high price paid is going to private corporation profit, an increase in the cost of energy will have the desired effect of making alternative renewable energy more attractive. Is that not the goal of putting a tax on carbon dioxide? Sure spending $10k + to put up solar panels on your home doesn’t make sense when you have a $100 per month power bill, it may when that monthly bill goes up to $1000.

    1. Actually Jim, the U of C report shows the high electricity cost is only the result of profiteering from the big generators. The other big cost is the wires for delivery. The wires are stupidly expensive because the Cons set the grid up so several billion dollars (with a guaranteed ROI from the public) was spent building two gigantic transmission lines to service obsolete central generating plants. We are still paying for those lines and now we are also paying for the web-style grid to service the de-centralized generators popping up all over the place in Alberta.

      So, yes your home solar panels are a rather poor investment. However, if you go whole hog and put the panels and batteries in to go off-grid, that may make sense. For new-builds in the country “selfish solar” wins hands down. For city people, especially in Calgary and Medicine Hat where you have city-owed power, not so much.

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