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ARTICLE · 16 JUNE 2017

Alberta Caps Power Prices With Bill 16

Blake, Cassels & Graydon LLP
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On June 7, 2017, Bill 16, titled "An Act to Cap Regulated Electricity Rates" (Bill 16), received royal assent and is now law.

CanadaEnergy and Natural Resources
Peter Keohane
Peter Keohane
Chris Harris
Chris Harris
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On June 7, 2017, Bill 16, titled "An Act to Cap Regulated Electricity Rates" (Bill 16), received royal assent and is now law. Bill 16 will impose a maximum rate of 6.8 cents per kilowatt hour (kWh) for electricity consumers on the regulated rate option or RRO (a government-regulated rate that fluctuates monthly). The price cap comes on the back of the Alberta government's initiative to transition from the province's current energy-only market in favour of a capacity market system that is seen by some as more capable of promoting renewable generation investment. However, the introduction of a capacity market as well as the procurement of renewable electricity may result in a material increase in electricity prices. Bill 16's maximum rate is aimed at protecting consumers against such an increase.

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