Calgarians should expect to see a modest reduction on their utility bills starting this month after the City of Calgary successfully argued that customers were being overcharged for the natural gas distribution fee.
The adjustment comes after the Alberta Utilities Commission (AUC) agreed with submissions made by the city's gas, power, and telecommunications committee that customers were being overcharged for I.T.-related services in a 10-year contract with ATCO.
The city announced on Thursday that the AUC decided to implement a 13 per cent reduction of those costs on customer bills in the first year of the $1.2-billion agreement.
It should result in a 1.4 per cent reduction in annual natural gas distribution rates — which works out to about 83 cents a month for the average household, or $10 a year, according to Oyin Shyllon, an economist and regulatory lead with the City of Calgary.
He also said customers will receive the savings regardless of who their gas marketer is.
"Anybody who has a natural gas connection — residents, businesses — they would receive it," Shyllon said.
Action taken by city 'saved a lot of money,' Chu says
Calgary Coun. Sean Chu, the chair of the gas, power, and telecommunications committee, said Thursday that many of the details of the case are protected by commercial confidentiality agreements.
"At the end of the day, the City of Calgary saved a lot of money — including a lot of homeowners — because of the action we took," Chu said.
While some Calgarians might not consider savings of $10 a year substantial, Shyllon said that the reduction is notable in part because of its rarity.
"These are significant savings because it is unusual for these types of reductions to occur," Shyllon said.
"The cost of doing business increases every year, and typically utility charges go up, and to have this type of reduction is pretty rare."
The city said that costs will be reduced by a further 4.61 per cent in each of the remaining nine years of the contract, but the dollar amount customers should expect their utility bills to decrease cannot be calculated beyond 2020.