May 19, 2004
Saskatchewan's annual cost for basic utilities is much lower than the cost in Alberta and most other provinces, and only slightly higher than in Manitoba, according to a survey conducted by Crown Investments Corporation (CIC) and validated by the accounting firm Meyers Norris Penny.
The Basic Utility Bundle Survey measured the annual cost for the average residential customer for natural gas and electricity, basic phone service and car insurance. Cost comparisons were made for major centres, rural communities and northern communities across Canada. Rebates and discounts, such as good driver discounts, were included. Municipal surcharges and federal and provincial taxes, were excluded.
"Saskatchewan compares very well in our first survey on the basic utility bundle," Crown Management Board Minister Pat Atkinson said. "Our costs are significantly lower than Alberta's across all categories, and we have the lowest costs in the country among northern communities. In the other categories we are second to Manitoba, but only by about $2 a month in the major centres and less than $7 a month in rural communities.
"This is a good showing, but we are committed to keeping the commitment the Premier made last fall. We will achieve our goal of having the lowest-cost basic utility bundle for all Saskatchewan families during 2004 and every year after that."
Crown Investments Corporation (CIC) developed the methodology for the bundle and conducted the cross-Canada comparisons. Rates for telephone, electricity and natural gas charges are for the calendar year 2003, while car insurance rates were those in effect from February 27th to March 2nd, 2004. Average annual consumption levels were used for natural gas and electricity, while phone service was based on the cost of a single line touch-tone phone during a year. Car insurance was based on a composite of the most common vehicles registered in Saskatchewan and a selection of driver profiles.
The national accounting firm Meyers Norris Penny reviewed the methodology and comparisons.
"We found the methodology, assumptions, costs and calculations to be reasonable and reliable," Managing Partner of Meyers Norris Penny LLP in Saskatchewan Howard Crofts said. "We believe the bundle is a useful and meaningful measure of the cost of the four basic utilities for Saskatchewan residents."
"Our rates for the four basic utilities have traditionally been among the lowest in Canada," Atkinson said. "SaskPower, SaskTel, SaskEnergy and SGI have done an excellent job of keeping these rates low while at the same time providing high quality service, paying down their debt and paying dividends to the province. We are confident they can continue to do all of these things while providing the lowest rates in Canada."
The Saskatchewan Rate Review Panel will be maintained to review proposed rate changes from SaskPower, SaskEnergy and SGI (on behalf of the Auto Fund). SaskTel is federally regulated by the CRTC. The Panel will not be responsible for ensuring that Saskatchewan residents enjoy the lowest-cost bundle of utility services in Canada.
"Government will be responsible for the keeping the utility bundle commitment, but the Rate Review Panel will still have an important role to play," Atkinson said. "It will continue to provide advice to government on whether proposed rate changes are fair and reasonable. As well, it will consider the effect of proposed rate changes on commercial and business customers, whose rates are not part of the utility bundle."
The utility bundle comparisons released today will be used as a benchmark. CIC will monitor utility costs throughout Canada during the year. It will provide a public report on its comparisons once a year, beginning in 2005.
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