http://www.cbc.ca/news/canada/new-brunswick/union-eub-nb-power-street-light-rate-increase-1.4588727
Municipalities accuse NB Power of over-charging for street-light service
Margot Cragg says EUB should make the utility adhere to the rate standard the board set
The Union of Municipalities of New Brunswick says NB Power needs to stop raising the rates it charges for street lights.
In fact, executive director Margot Cragg said the utility not only needs to stop raising rates — it needs to reduce them.
Cragg made
a presentation to the Energy and Utilities Board in early February
after the City of Fredericton wrote a letter about the rates for street
lights and the union decided to take on the fight for all
municipalities.
"For Fredericton, the cost in 2017 was over a million dollars," she said. "For other municipalities in the area, like Oromocto, it was $340,000 and even for a rural community like Hanwell, it was over $41,000 … that's a pretty hefty bill."
Cragg said money spent on street lights can't be spent elsewhere.
She added the EUB has set a standard to determine the charges to each rate class.
"So what the EUB has said is that the rate charge for each class should be about equal to the cost of supply of the service, within a range of reasonableness."
But Cragg said NB Power is proposing to increase it to 195 per cent of that cost.
"That's almost double the cost of actually providing the service."
In fact, executive director Margot Cragg said the utility not only needs to stop raising rates — it needs to reduce them.
"For Fredericton, the cost in 2017 was over a million dollars," she said. "For other municipalities in the area, like Oromocto, it was $340,000 and even for a rural community like Hanwell, it was over $41,000 … that's a pretty hefty bill."
Cragg said money spent on street lights can't be spent elsewhere.
Another increase
She added the EUB has set a standard to determine the charges to each rate class.
"So what the EUB has said is that the rate charge for each class should be about equal to the cost of supply of the service, within a range of reasonableness."
But Cragg said NB Power is proposing to increase it to 195 per cent of that cost.
"That's almost double the cost of actually providing the service."
Information Morning - Fredericton
Union of Municipalities upset with NB Power
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In 2017-2018 it was 192 per cent of the cost.
"That cost to revenue ratio has been getting worse year over year," Cragg said, adding that if the proposed rate is accepted, the ratio will be even more punitive.
'Optional' service
At its rate hearing last year, NB Power said it considered street light service optional and not subject to the EUB's fair price guidelines. It also said the higher prices it charges for street lights help it to keep prices it charges other customers, such as homeowners, lower.
At hearings this week, both public intervener Heather Black and EUB lawyer Ellen Desmond pressed NB Power rate design managers to explain why they ignore the board's fair price guidelines in setting charges for both street lights and water heater rentals.
"NB Power doesn't really view street lights as a rate class," said the utility's rate design specialist Kevin Gibson. But he said it would follow whatever direction the EUB gives it on the issue.
Follow the standard
Cragg said it's up to the EUB to make NB Power follow the standard it set.
"Any dollar that is spent on excessive pricing for street lighting is money the municipality can't spend fixing the road, can't spend on the water services, can't spend on the services and infrastructure you and I use every single day in our communities," she said.
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