The Saskatchewan Rate Review Panel has approved a 10.5 per cent SaskPower rate increase over two years, and denied a further five per cent hike in 2016.
The panel is recommending that the provincial government approve a 5.5 per cent rate increase, which took effect on an interim basis on Jan. 1.
It also recommends a further rate hike of five per cent on Jan. 1, 2015, which will be subject to SaskPower meeting additional filing requirements.
The panel says SaskPower’s proposed rate hike in 2016 was rejected on the basis of "future financial uncertainties."
“There are many financial uncertainties or future variables regarding the 2014-2016 forecasts,” the panel said in a news release Monday.
“These become less certain when forecasting the accuracy of costs and revenues into 2015 and 2016.”
Panel chairperson Kathy Weber noted that a majority of revenue from the rate hikes would cover costs associated with SaskPower’s capital projects.
During the review process, several stakeholders questioned the need and the timing of some of those projects, the panel said.
“While many of the capital expenditures are justified and necessary to provide a safe and reliable power supply to the province, the panel agrees with several customers who expressed concern about SaskPower’s forecasting costs over a multi-year period,” Weber said in the release.
“A more transparent process will assist in educating the general public and the stakeholders, and will provide the panel with the information needed to make recommendations on future rate increases.
“It is in the best interest of all parties, including the public, SaskPower and its customers, to review possible rate increases at a time when more certainty in future cost and revenue information is available.”
SaskPower’s proposed 15.5 per cent rate increase over three years was the first multi-year application the panel has received from the Crown-owned utility.
