The territorial government is introducing a “short-term” cost of living subsidy to offset the rising cost of electricity. While it is unclear how long the subsidy will be in effect, it proposes to offset the increase rates for places like the South Slave facing a 62 per cent rate increase.
The cost increases came into effect Feb. 1, following the Public Utilities Board’s approval of an application from the Northwest Territories Power Corporation.
According to the message released by the GNWT, the subsidy will be applied to electricity bills for households where electricity bills have increased by 15 per cent since 2023 and 2024.
These include communities in the South Slave and communities that rely mainly on diesel or other fuel-based generation due to the high cost of electricity. Households in these regions face bill increases of 33 per cent to 62 per cent, said officials.
According to the info released by the territorial government, the subsidy will automatically be applied on customer bills.
According to the GNWT, fuel and thermal powered, communities will see an increase of 8 per cent in their bill with the application of the subsidy. Taltson hydro system communities will see an increase of 14 per cent with the application of the subsidy.
The Taltson station is undergoing overhaul work, a major factor considered in NTPC’s general rate application.
In January, Prendergast reported that the total cost for the Taltson Overhaul is estimated at $119 million. In their application to the public utilities board, the Power Corp had previously estimated the total cost for the overhaul was expected to total approximately $97.8 million. This included $70 million in project costs and about $45 million in fuel and other operational costs
Doug Prendergast with NTPC said that the initial estimates of about $20 million on repairs for surge tank damages (discovered this summer) have almost doubled.
“The cost of the surge tank remediation work, including fuel to provide power to customers while the work was being done, is approximately $36 million,” said Prendergast.
“Electricity rates have recently been set by the NWT Public Utilities Board and will not be directly impacted by Taltson’s return to service. Current rates will remain in place until NTPC submits its next General Rate Application, which is not expected to occur for a couple of years,” he added.
Prendergast has said that in order for services to remain reliable and in order to reduce the environmental impacts within the electricity sector, aging infrastructure will need to be “replaced or refurbished.”
The Taltson Hydroelectric Facility was first built in 1965.
Officials said that customers on the Snare system will not be eligible because their expected increase is estimated at 8 per cent.
Naka Hydro communities will also see the subsidy applied to their wholesale bill, said the GNWT in the message released Tuesday morning.
“Customers in Naka Hydro communities, other than Yellowknife, were at risk of seeing material increases of their electricity bills. The GNWT will apply support to Naka’s wholesale bill so higher costs are not passed on to residents.”
It is unclear how long the subsidy will be in effect.
Finance Minister Caroline Wawzonek said the subsidy is meant to help offset the immediate impact of what are significant rate increases.
“This support ensures residents in the communities facing the greatest cost increases receive meaningful relief during a period of adjustment. Our goal is to help households and businesses manage these changes while maintaining a reliable and sustainable electricity system,” said Minister Wawzonek.
North Now has reached out to the GNWT for more information and will share those details when they become available.
Update: The territorial government says the new cost of living subsidy announced on Tuesday will be in effect until 2028.
