Naka Power is calling for the Northwest Territories to simplify its power rate system.
Representatives from the private utility company, which is a partnership between Atco and Denendeh Investments, spoke to a committee of regular MLAs at a Tuesday public briefing regarding the territory’s energy challenges.
Jay Massie, Atco’s vice president of northern development and Indigenous relations, called for the NWT to move from seven electricity rate zones to two. He said now was a “very opportune time” to do so.
“With the existing zone structure and how it’s set up, it provides for unequal rates for similar customers. It’s fairly expensive to administer and quite complicated,” Massie said.
The NWT curently has four electricity rate zones under the NWT Power Corporation – or NTPC, which is wholly owned by the territorial government – and three under Naka.
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Massie said a two-rate system – between hydro and thermal, meaning communities that rely on diesel – would ensure customers across the NWT have fair and equitable energy rates, regardless of their utility provider.
He argued that under the current system, NWT government support is “disproportionately directed to benefit NTPC customers,” pointing to a $48-million subsidy the territory recently announced it would provide to NTPC over four years.
Massie said the NWT could also look at having one zone or “postage stamp rates” like in the Yukon, where customers in the same rate class pay the same rate for electricity, regardless of the utility providing it.
“We think all of this would lead to cost decreases in the end for customers, whether they’re in Yellowknife or an isolated community,” he said of reducing the number of zones.
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“When you simplify anything, I guess, it becomes more efficient to administer and would reduce costs all by itself.”
Overlap between NTPC and Naka
The concept of reducing the number of rate zones in the NWT is not new.
A 2010 review of the territory’s electricity system recommended moving from 33 to three rate zones. The NWT government subsequently decided to establish the current seven-zone system.
On Tuesday, Massie further suggested decreasing the overlap between Naka and NTPC by having the power corporation focus on energy generation and Naka focus on transmission and distribution.
Naka currently distributes power generated by NTPC to customers in Yellowknife, Ndılǫ, Enterprise, Hay River and Kátł’odeeche First Nation. (The Hay River distribution franchise is due to move to NTPC in a few months’ time, a change that Naka – formerly known as Northland Utilities – fought for eight years.)
Naka operates diesel generators and distributes power in Dory Point, Kakisa, Fort Providence, Sambaa K’e and Wekweètì.
NTPC generates and distributes electricity for 26 NWT communities from a combination of hydro, other renewable sources and fossil fuels.
Massie said he is hoping to bring together Naka, NTPC, the NWT government and regulator the Public Utilities Board to “see if there’s a better way to serve customers and reduce rates overall across the NWT.”
“It’s something we’ll need to get agreement from others on,” he said.
In a statement to Cabin Radio, NTPC spokesperson Doug Prendergast said the corporation would await the legislative committee’s report.
