ATCO Delivering Over $500 Million in Savings to Albertans: Undeterred by AUC Decision, ATCO Continues to Pursue Efficiency and Affordability for Customers

ATCO is extremely disappointed with yesterday’s AUC decision regarding regulatory rules. ATCO believes the AUC is now interpreting the rules differently than previously outlined

ATCO is the only Utility in Alberta to reduce distribution costs by 8 per cent and continues to drive affordability for Albertans along with regulatory fairness

ATCO is the only utility in Alberta to reduce distribution costs during the current five-year regulatory term and supported the PBR (Performance-Based Regulation) framework since its introduction. PBR incentivizes Alberta utilities to reduce costs while maintaining safe and reliable service and then share those cost savings with customers. 

ATCO is extremely disappointed with the position announced by the Alberta Utilities Commission (AUC) yesterday.  

ATCO has already been granted the right to appeal the AUC PBR 2 Reopener decision, and the matter will be heard in the Alberta Court of Appeal this October.

“ATCO operated within the PBR regulatory framework and is proud of the cost savings we have achieved for customers and for our business under PBR,” said Jason Sharpe, Chief Operating Officer of ATCO Energy Systems. “Our employees put the customer at the centre of our business, enabling ATCO to deliver more than $500 million in savings in distribution costs, which customers are already benefitting from over the 2023-2028 period.”

“ATCO believes the rules that were established are now being interpreted and administered differently, after the fact,” continued Mr. Sharpe. “We will continue to advocate for a regulatory framework that provides certainty for customers and industry alike.”

As an energy provider in Alberta for more than 110 years, ATCO remains steadfast in its mission to serve Albertans with integrity and a long-term vision for reliable and affordable energy. ATCO continues to be a leader in advocating for a fair, affordable, and efficient regulatory and business environment in Alberta.

Background on Performance Based Regulation

Rates for electric and gas distribution utilities in Alberta are set under a form of Performance Based Regulation (PBR). PBR is designed to mimic competition and encourage efficiency by providing incentives for the utility to reduce costs, while safeguarding reliability, and minimizing rate increases.

The issue concerns the AUC’s position that ATCO was not detailed enough in documenting the specific sources of all the cost savings achieved by its Alberta natural gas and electricity distribution utilities during the previous PBR period of 2018-2022.

The AUC has previously acknowledged that “it is difficult, if not impossible, to identify and separate cost reductions that the ATCO Utilities would have undertaken” in response to the PBR framework from other factors. Yet in the May 2024 PBR2 reopener decision, the AUC claimed that the ATCO Utilities failed to fully quantify or attribute all efficiency gains under PBR to specific programs or initiatives —leading to today’s remedy decision. This contradiction underscores the pressing need for regulatory certainty. While the May 2024 PBR2 reopener decision is currently under appeal, ATCO requested that the AUC delay determining any remedy until the appeal is resolved. That request was denied.

From 2023 – 2028 ATCO Gas and ATCO Electric businesses will deliver over $500 million in distribution savings to its Alberta customers, already reducing distribution costs charged to customers by eight per cent. ATCO is the only Alberta utility that delivered natural gas and electricity rate reductions to customers at the end of the PBR2 period. While ATCO disagrees with the remedy decision issued, we  remain proud to have already reduced rates for customers through the actions taken.

Distribution rates are the costs of operating the pipes and wires that provide natural gas and electricity to homes and businesses and represent the portion of the utility bill for which ATCO Gas and ATCO Electric are responsible.

About ATCO 

As a global enterprise, ATCO Ltd. and its subsidiary and affiliate companies have approximately 21,000 employees and assets of $27 billion. ATCO is committed to future prosperity by working to meet the world’s essential energy, housing, security and transportation challenges. ATCO Structures designs, builds and delivers products to service the essential need for housing and shelter around the globe. ATCO Frontec provides operational support services to government, defence and commercial clients. ATCO Energy Systems delivers essential energy for an evolving world through its electricity and natural gas transmission and distribution, and international electricity operations. ATCO EnPower creates sustainable energy solutions in the areas of electricity generation, energy storage, industrial water and cleaner fuels. ATCO Australia develops, builds, owns and operates energy and infrastructure assets. ATCO Energy and Home Services provides retail electricity and natural gas services, home maintenance services and professional home advice that bring exceptional comfort, peace of mind and freedom to homeowners and customers. ATCO also has investments in ports and transportation logistics, the processing and marketing of ash, retail food services and commercial real estate. More information can be found at www.ATCO.com.

Contact:

Colin Jackson – Senior Vice President, Financial Operations – Colin.Jackson@atco.com – (403) 808-2636

Source: ATCO Ltd.