Inuvik passes motion to fight increase in gas costs

Inuvik’s town council has passed a motion authorizing “all means possible” to stop Inuvik Gas increasing the municipality’s gas rate by 44 percent.

Atco, of which Inuvik Gas is a subsidiary, announced an increase in rates this week.

The company said the increase was the first since 2012. For residential customers, the rate moves from $35.44 to $45.44 per gigajoule – a 28-percent increase. However, for government customers like the town, the new rate will be $51 per gigajoule.

Mayor of Inuvik Peter Clarkson told Cabin Radio that will cost the town an extra $180,000 to $200,000 per year.

More broadly, he said, the rate increase as a whole will mean businesses like local grocery stores will have to absorb more costs, passing on that spending to their customers, who themselves will be paying more for gas at home and at work.

“It’s just such an incredible increase,” Clarkson said.

“Absolutely nobody got a wage increase of 28 percent and government funding didn’t increase by 44 percent.”

According to the Bank of Canada, inflation was 38.9 percent between 2012 and 2026.

Clarkson, rejecting the argument that this is the first increase in 14 years, said he questioned the broader pricing mechanisms behind the Inuvik Gas rates. He said the town intends to find experts to help the municipality gauge what gas should actually cost the community.

Flooded with complaints

In the meantime, Wednesday evening’s motion authorizes staff to begin pursuing action to stave off the increase.

That action will itself cost town staff time and potentially money through specialist utility lawyers and consultants. It will involve heading to the NWT Public Utilities Board, which regulates Inuvik Gas, and asking it to intervene.

The Public Utilities Board describes its approach to Inuvik Gas as “light-handed.” The company faces competition from other forms of heating fuel in the town, the board states on its website, meaning it already faces competitive pressure where some other utilities in the territory do not. (Generally, power companies in the NWT are the only game in town for the communities they serve.)

As a consequence, Inuvik Gas does not appear to have needed to file any application with the board before raising its rates. The board states it regulates Inuvik Gas “on a complaints-basis only.”

The town’s solution will be to complain.

“I spent half the day today with the media,” Clarkson told council on Wednesday evening, listing an array of CBC outlets. He added the town will set up public messaging that has the effect of encouraging complaints to the Public Utilities Board.

“It doesn’t just have to be the town. The more complaints the PUB gets, the more seriously they will take the complaints,” he said.

“Our main stick on this is to go to the PUB,” he told Cabin Radio earlier in the day, adding the aim is for the board to be “flooded with complaints.”

“It should be hard regulation, not soft regulation, similar to what it is for power,” the mayor said, “where they actually have to prove to the PUB that their rate of increase is legitimate.”

Atco has said the Inuvik Gas rate increase “reflects the investments and work required to keep energy flowing reliably to Inuvik.”

In a statement, the company said it had made significant improvements to infrastructure and operations to offset a decline in local natural gas production and address “extreme cold weather events and periodic road closures” that interrupt propane delivery to Inuvik.

“Over the past year, IGL has taken the appropriate steps to strengthen our energy security including modernizing our infrastructure and increasing our propane storage capacity by 75% and increasing our synthetic gas production,” the company stated.

“We recognize that any increase affects customers and we remain the most cost-effective energy source for the community.”