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propane cost

The B.C. Utilities Commission has scheduled an Oct. 3 meeting in Whistler to hear opposition to a proposed 22 per cent increase in propane rates. The proposed increase comes just 1 1/2 years after another increase, says Tim Wake, one of the people opposing the increase. "It’s not even so much the price increase that’s the issue, it’s the process," said Wake. "Centra Gas has a monopoly and the Utilities Commission is supposed to regulate that. The process hasn’t embraced ‘competition’." Centra Gas applied for the rate increase based on the forecasted cost of propane from Sept. 1 of this year to Dec. 31, 1997 compared to the cost currently recovered in rates. The company says the rate increase would mean on average an extra $204 per year for houses heated by propane and would make annual propane heating costs just $36 lower than electric heat. The proposed increase is due to the rising cost of propane and natural gas across the continent, which is partially driven by extreme weather the last year and, more locally, by greater exports of propane and natural gas from a facility in Washington state. Centra says the cost of buying propane has gone up 47 per cent over the last 18 months. Fuel costs account for about half of the gas rate Centra charges. The other half is fixed costs. But Wake asks, under the current monopoly situation, what incentive does Centra have to negotiate a good price for fuel? "The Utilities Commission should come forward with a mechanism to make the process comparable to a competitive situation," he says. The biggest users of propane in Whistler are the Chateau Whistler, the Delta Whistler and the municipality. Wake has an interest in energy issues and has been involved in negotiations with Centra as a representative of residential users. Part of the problem is also that there is little stability in pricing. A gas cost reconciliation account was approved by the Utilities Commission during the last negotiated settlement, to allow Centra to defer increases (and decreases) in fuel costs, rather than pass them on immediately to the consumer. In a February letter Centra predicted the deferred costs to Whistler would be $364,000 by the end of 1996. The costs are already over $600,000 and Whistler customers are charged interest on the account. "My first objective is that we not be charged interest on the account," Wake says. Secondly he would like to get away from the big win/lose situation with pricing. Whistler is one of only two towns in B.C. that has a propane grid system, Port Alice being the other. The propane is transported to Whistler by rail car. The Oct. 3 public information meeting is at 7 p.m. at Myrtle Philip School. The meeting is open to all. Centra Gas representatives will be there to discuss the proposed rate increase.