By Charlotte Morritt-Jacobs - (@morrittjacobs on Twitter) with files from Alberta News Press Release

New Province Wide Cap On Electricity – Twice What Consumers Are Currently Paying

Nov 22, 2016 | 11:45 AM

ALBERTA – Electricity prices in Alberta are at a historic low over the past decade – despite this, Premier Rachel Notley announced on Tuesday, Nov. 22nd, that the NDP government intends on putting a cap on power prices as part of a plan to move away from coal-fired electricity production.

In a press conference, Notley stated that the cap, along with other reforms to be announced later on this week, will provide stability in prices during the transition from coal-fired electricity.

“While electricity prices are low today, the current oversupply won’t last forever. Alberta’s economy is stabilizing and this government won’t put Alberta families, jobs or the economic gains we are beginning to see at risk in a volatile electricity market.”

The cap is to be fully implemented by June 2017 and under the new long-term contract rate Albertans will never pay no more than 6.8 cents per kilowatt hour.

The 6.8 cents per kilowatt hour is approximately twice the price most Albertans pay currently.

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However, during the period from June 2017 to June 2021 that the rate ceiling is in effect, consumers on the Regulated Rate Option (RRO) will pay the lower of the market rate or the government’s ceiling rate.

This rate ceiling will be automatically applied to the bills of consumers on the regulated rate and consumers can also choose to continue to take advantage of an offer from any private supplier.

Margeret McCuaig-Boyd, Minister of Energy will lead the consultations with distributors, RRO providers, retailers and consumers, beginning in December.

According to a government press release; historically, regulated electricity rates have been extremely volatile – increasing by as much as 65 per cent (or 4.66 cents per kilowatt hour) in a single month (April 2011) and crashing by as much as 42 per cent (or 4.14 cents per kilowatt hour) in a single month (June 2014).

Premier Notely noted that previous Alberta governments experimented with a risky and volatile form of electricity deregulation.

“This experiment left families, businesses and our economy at the mercy of sudden price spikes and uncertainty like we’ve seen in the past and need to protect against in the future.”

Notley’s government is working to phase out coal-fired electricity by 2030, replacing it with renewable energy.

The electricity cap is to be in effect until 2021.

This week, the government will also outline a series of reforms that will:

– Enhance Alberta’s market framework to create the conditions for private investment affordability, reliability and price stability.

– Provide more detail on the phase-out of emissions from burning coal by moving to a mix of electricity generation sources.