Natural Resources
December 8, 2006
Rate Increase for Isolated
Diesel Communities Minimized in 2007
The Provincial Government will spend an estimated
$400,000 in 2007 to ensure small businesses and residents in
isolated diesel communities on the Labrador coast and the island
receive almost no rate increase in 2007 as a result of Newfoundland
and Labrador Hydro�s General Rate Application.
As a result, rates for residential customers will increase by about
eight cents for every $100, while the increase for business
customers will be less than $1.
Following negotiations with the consumer advocate and other
interveners, Newfoundland and Labrador Hydro was able to avoid
requesting a rate increase for most groups of customers for 2007,
except for those in remote diesel communities. This increase was
related to the rising cost of fuel for diesel generation. Government
has decided to absorb the cost of the planned increase for these
customers for 2007.
�We are willing to offset the rate increase for these residents and
more than 600 small business customers in our rural isolated
communities in Labrador and on the island,� said the Honourable
Kathy Dunderdale, Minister of Natural Resources. �These customers
already pay some of the highest electricity rates in the province
and we want to extend the same benefit to these customers that other
non-isolated customers will receive in 2007.�
Government will spend an additional estimated $200,000 in 2008 to
allow for the gradual implementation of the proposed rate increase
to these customers.
Newfoundland and Labrador Hydro announced today it has reached a
negotiated agreement with its interveners that will see virtually no
changes in electricity rates for most customers in 2007 as result of
its General Rate Application. This announcement reflects the
contribution being made by the province to have isolated diesel
communities on the Labrador coast and the island included.
�With modest financial assistance from the province, Hydro has been
able to reach an agreement that will see its electricity rates
remain relatively stable in 2007 at a time when many other
province�s are experiencing significant increases,� Minister
Dunderdale said. �We are pleased to see that Hydro has been able to
settle its major issues through negotiation and outside the
traditional hearing process. This is much more efficient and
cost-effective for all involved, including Hydro�s customers.�
Government is directing the Public Utilities Board (PUB) to adopt a
policy for isolated diesel customers that, starting January 1, 2008,
any change in electricity rates shall be equal to changes for
equivalent rate classes of Newfoundland Power and that rate changes
starting January 1, 2008 be based on a two-year plan to be submitted
by Newfoundland and Labrador Hydro.
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Media contact:
Tracy Barron
Director of Communications
709-729-5282, 690-1703
TracyBarron@gov.nl.ca
2006 12 08
10:30 a.m.
