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Riding the rolling waves of Alberta’s energy market have left some facility owners feeling a little seasick recently. After years of relatively smooth sailing with low, steady and predictable electricity prices, 2018 is proving to be more turbulent than many people bargained for.

We’ve had very low-cost electricity in Alberta for a long time. Electricity prices had been hovering around 2 cents/kWh for the past three years. Now, we’re seeing some significant rises, and sharp drops, in prices. For a full day in May 2018, the wholesale cost of power in Alberta shot up to 34 cents/kWh.

For many, the unpredictability in the market this year has been an unpleasant surprise. But energy experts, like ATCOenergy’s Rupinder Bhatti, recognize the underlying causes of these fluctuating prices. “In 2018, new changes were introduced into the regulatory market. At the same time, more than a few generators were decommissioned. That reduced supply in the marketplace and introduced a lot of volatility,” Bhatti explains.

While electricity prices are taking consumers on a wild ride, it’s a different story on the natural gas side. As a North American market, the supply and storage numbers are high. As a result, we’re seeing historically low natural gas prices.

What’s on the horizon?

What will this mean for facility operators trying to scan the horizon and build some stability into their business plan? In Alberta, it looks like we’ll be dealing with a large degree of uncertainty related to the continually evolving electricity market for the next few years.

According to Bhatti, “We’re in a period of transitioning from our current energy market to a new Capacity Market, slated to be in place for 2021. The idea is to build incentives for renewable power generation as we phase out coal produced power.” This restructuring won’t happen overnight, and will continue to affect energy market prices for some time.

How can businesses weather the storm?

Bhatti recommends that this is a good time for facility operators to be proactive in managing their energy requirements. “New technologies are putting energy efficiency in the forefront of building management,” Bhatti explains. “Incorporating in-house generation like solar power, combined heat and power (CHP), retrofitting or microgeneration are ways to ensure maximum building efficiency.”

These emerging technologies are growing in popularity as facility operators adopt to reduce long-term costs as well as their carbon footprint, but they’re not the only option.

Bhatti also recommends operators take a closer look at their risk tolerance. He tells his clients, “If large price fluctuations are having a negative impact on budgets or forecasts, you should look for price certainty options.”

But where can you find price certainty amid such volatility? Energy retailers like ATCOenergy offer several guaranteed-rate options. Sometimes referred to as fixed rates, these plans allow facility operators to choose a stable rate for the next 3 or 5 years.

By choosing a guaranteed rate plan, consumers can count on stability in a volatile electricity market, and secure historically low natural gas rates for the long term.

Rupinder Bhatti is a Senior Energy Marketer with ATCOenergy. For more information on ATCO’s energy plan options, in-house power generation and marketing insights, visit ATCOenergy.com or call 1 844 887 6937.

All customers are free to purchase natural gas services from the default supply provider or from a retailer of their choice and to purchase electricity services from the regulated rate provider or from a retailer of their choice. The delivery of natural gas and electricity to you is not affected by your choice. If you change who you purchase natural gas services or electricity services from, you will continue receiving natural gas and electricity from the distribution company in your service area. For a current list of retailers you may choose from, visit http://www.ucahelps.gov.ab.ca/ or call 310-4822 (toll free in Alberta).

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