With no green power component included, council locked into a three year energy agreement with Alberta Municipal Services Corporation (AMSC) for all its municipal facilities.
Before entering into another agreement for natural gas and electricity, administration reported on the options and presented how much certified green power would cost at the regular council meeting on Aug. 20.
Previously, the Town entered into an agreement to purchase 15 per cent green energy for a five-year term, which came at an increased cost of approximately one cent more a kW/h equating to approximately $14k.
The current costs of green energy is $0.03 kW/h which would have a potential negative impact of $30k to $75k per year, stated Carla Fox, director of corporate services.
Fox explained the vast range in the negative impact is because it is based on a rate, “Currently they can’t guarantee a rate for us and if there is any additional usage based on increased anticipation of other facilities using more power, so we weren’t able to give you a set rate because of the variable cost right now.”
Therefore, administration recommended Council not proceed with the purchase of green power.
“Green power is a nice thing to do, but of course there are extra costs to green power. Typically the contract is one cent per kW/h and green power is about three cents per kW/h, so that’s approximately $20,000 more per year,” said CAO Martin Taylor.
Coun. Dewly Nelson felt that council should approve a three year energy agreement with AMSC with a status quo green power component of 15 per cent.
“We’ve been at 15 per cent for a long time and I believe that should be captured within our budget cycle,” said Coun. Dewly Nelson.
“Our strategic plan, our community sustainability plan both speak to sustainable energy development, and also I look at the Municipal Governance Act and the very first item within the MGA is that first the municipality is to provide good government and to foster the wellbeing of the environment.”
Coun. Trevor Haas spoke of the importance of green power but that due to the high cost suggested potentially dropping the percentage.
“I could potentially be in favour of reducing the percentage to kind of equate to what we’ve normally done. But to put it at 15 per cent at three cents, I just don’t feel comfortable with that,” he said.
Council decided to split the motion and first approved entering into a three year energy agreement with fixed rates.
They then dropped down from 15 per cent to five per cent green power, but votes on this motion were split resulting in an automatic defeat of motion.
This means that the town will not include a green power component in their agreement.
Nelson asked why the electricity contract was not captured in the budget cycle if an increase was expected.
“This is likely captured in the budget, should be absorbed in the budget at status quo. But understanding that the huge impact in the budget on taxpayers isn’t fair either, I feel it puts us in a really challenging position,” he said.
Fox commented that the budget did include an increase of what they were aware of at the time, but could not speak on it further as the person responsible for that portion of the budget was not in attendance.
“We used the best information we could that we had at the time based on the current agreement and the estimates, but the variable rates change so much it’s pretty hard to predict what those changes are going to be,” she added.
The Town has participated in the AMSC aggregate program since 2004, which is a wholly-owned subsidiary of the Alberta Urban Municipalities Association (AUMA) that provides aggregated services to member municipalities, associates and not-for-profit organization.
The AMSC Energy Program was launched at the time Alberta deregulated its electrical utility industry in response to its members needs and carries a wide range of natural gas, electricity and optional green power products to balance cost and risk tolerance.
The past agreement expired on Dec. 31 and a new agreement to procure electricity and natural gas needed to be made.