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Residential Battery Storage… is this “Thee” Disruptive Technology?

· · Leave a Comment Consumer Info, Electricity, Interesting, Solar Power

As governments around the globe continue to promote solar PV, the next market to show strong growth in coming years will be the storage market. We asked Terry Rendflesh for his views and to share his thoughts on “time shifting”; where storage can be charged during periods of high solar PV output and discharged later, often during peak demand periods. We hope you find this of interest and value.

Kris Kasawski, Director, Park Power

Residential Battery Storage… is this “Thee” Disruptive Technology?

By: Terry Rendflesh, P.Eng.

A disruptive technology is one that displaces an established technology and ultimately shakes up the industry, or a ground-breaking product that creates a completely new industry.

Could residential battery storage be “thee” disruptive technology? It very well could be.

For years the province and much of the world have been looking for alternative sources of energy outside of traditional fossil fuels. As the cost of solar, wind and battery storage continue to decline and the installed base continues to grow, we are also beginning to see consumers utilizing electricity for more of their everyday needs, such as driving, heating, and cooling.

It is unlikely that fossil fuels will be completely eliminated from our lives anytime soon. We rely heavily on fuel to power our commercial and industrial growth and it provides the basis of our plastics and polymers that make up half of our consumer goods. Examples of such include automobiles, communication and entertainment goods, and even the structures supporting renewable technology, like battery cases.

A 2007 study by National Resources Canada suggests approximately 80% of the average home energy consumed is in the form of heating. Many small consumers depend on two forms of energy in their everyday lives. Electricity for lights and heating, as well as natural gas and fuel oil for heating. The later forms of hydrocarbon-based energy can all be replaced by electricity, but never the reverse.

Finding the Appropriate Energy Mix

As countries and communities around the world explore the deployment of renewables like solar and wind, the technical challenges continue to grow.

The problem is now finding the appropriate mix of renewables, energy storage, and on-demand generation to meet the consumption needs of consumers. In opposition is the pressure to reduce the use of non-renewable energy such as coal, fuel oil and natural gas.

Grid-tie solar provides a means for the individual investor to physically participate in green energy solutions. However, this technology is currently implemented in a way that displaces grid consumption during the daytime while requiring connection to the grid to provide peak power when the sun stops shining. While effective during the summer months and long daylight hours, it does not compliment the annual system profile as shown below.

Figure 1 Weekly Average Demand for January to December Source: Enertyr Solutions Inc.

Traditional generation fueled by coal and gas has the ability to respond to swings in consumption in near real time. Renewable generation such as solar, wind and to some extent hydro, produce power when the environment permits it; rarely can it be called upon when we need it. They require the usage by each consumer to respond immediately to when generation falls off (when the wind stops blowing or the sun stops shining).

If the consumer cannot respond, we look to the energy supplier to provide a reliable energy supply to ensure the “lights stay on”. To date this is achieve by providing “spinning reserve” to cover any gaps in supply. “Spinning reserve” can be defined as a source that is online to provide immediate response for additional generation in the event existing generation fails, which could lead to a grid collapse if not provided. This generation must be financially compensated for being there – just in case.

So, we need to establish both a balance of existing generation types as well as enable the development of new technology without over-investing in infrastructure that is at risk of being “disrupted”.

Increased Electrification Poses Challenges

Alberta has the second-best solar potential in Canada. When compared to other countries around the globe like Germany, which recently set a new record for Solar PV production (producing over three times Alberta’s peak load), Alberta is lacking in installed capacity.

The figure below shows the Alberta average hourly provincial load for Monday to Sunday for January 2017. In Alberta much of the peak electricity we need on any given day is needed during the evening hours; much more so than compared to countries like Germany and areas of the USA. What makes up this demand? Predominantly heating and lighting.

If consumers begin to shift from gas to electrical heating, the demand for electricity would more than double and would add even more demand during the evening.

If this were to happen, our renewable resources themselves could not cover it. Could our distribution system handle this increase in demand? Unlikely, as the largest residential electrical load would be in communities with older homes where buildings are less efficient by construction.

Statistics Canada estimates that approximately 70% of the occupied private dwellings in Canada were constructed before the year 2000. Unfortunately, most of these homes are service constrained when it comes to using more electricity.

We all know that when a home is built, a breaker panel is installed. Building and electrical codes require that certain requirements are met for sizing these breaker panels. Homes that were built 50 years ago as an example, would have had a panel as small as 60 Amps. Anything built since then (the majority of homes on the market today) would have a panel rated at least 100 Amps.

The latest Canadian Electrical Code (as well as the National Electrical Code (NEC)) sets new requirements for sizing services when you have electric heating and electric vehicle charging, the two largest sectors of change residential consumers are facing. If consumers were to opt for an electric vehicle, or to switch to electric heating, they would ultimately double the size of service required to their home (an increase from 100A to 200A).

That makes our current utility and residential infrastructure undersized to provide a single energy service to each and every home.

The reality is that consumers cannot afford to run new power lines to each home, and the utility cannot justify increasing the capacity of each distribution transformer and service feeds alike in anticipation that consumers will switch energy sources. At the same time, your natural gas provider is not going to sit back and watch its residential business erode without a clear alternative.

Is Residential Battery Storage the Answer?

Alberta has had an abundance of generation built over the last few years. As we retire our coal fired plants and struggle to get the replacement generation in place promptly enough to handle demand, there may be pressure to implement Time of Use (TOU) tariffs as they have done in Ontario.

TOU tariffs are designed to incentivise consumers to shift their non-essential use of energy to off-peak times, in order to balance demand or simply shift the peaks to other hours of the day. These tariffs charge cheaper rates at certain times of night or day, when demand is at its lowest, and higher rates during the “energy rush hour”.

TOU tariffs are temporary measures. They are commonly applied year-round but there are times when it might be more favorable for generators to have consumers draw more energy to keep the generators properly loaded to achieve maximum efficiencies.

The introduction of storage to the market could supplement the evening electricity demand peaks and reduce the need for the introduction of TOU tariffs, providing we leverage Internet of Things (IoT) technology and smart energy control algorithms. The data provided by smart meters and the application of Artificial Intelligence (AI) will help “optimize” these algorithms.

Some key points:

  1. If you think you can replace all of your “energy” needs with just electricity, the reality is we just aren’t there yet. For example: if you consume a peak of 16 GJ/month of natural gas in the winter, you would need over 4450 kWh of electric heat to replace it. Considering your typical electrical consumption is only 750 kWh/month, this would be nearly six times what you currently consume. A new winter daily average including heat would total about 120-160 kWh/day.
  1. If your power panel is less than 125 Amps, it would be costly to upgrade your distribution system to your home. You would be required to upgrade both the power line to your home as well as the panel itself. The estimated cost of this upgrade would be in the range of $3,000 to $5,000; if not more. And that does not include the utility’s portion.

  2. Consider your current bill where the variable portion of your bill consists of 6.8 cents energy plus an additional 3.025 cents/kWh for delivery. Using a price of 10 cents/kWh energy including delivery, you would have a peak winter electricity bill exceeding $450/month, or over $500 by the time you include taxes and fixed costs.
  1. Residential battery storage is currently around the 20-40 kWh capacity range, which falls short of the 120 kWh/day winter requirements needed for an electricity only solution.
  1. There are no clear grid-tie tariffs allowing the connection of battery storage systems unless they are deemed “micro generation”. But storage is not the same as generation in the traditional sense – and should not be treated as such.

So it would appear we are captive to our two energy sources – for now.

Storage Capabilities Looking Up

Things are looking up. Tesla now has a 100-kWh battery bank for their cars. They produce a 13.5kWh Powerwall, expandable to 135kWh to augment their residential solar systems. Others like Eguana Technologies, a forward-thinking company located in Calgary, are offering commercial and residential energy storage systems in the 30+ kWh capacity rating. This technology is scalable to within reach of eliminating the need for both supplies to each resident.

Instead of competing with our current energy providers and utilities, I propose consumers utilize residential battery systems with the electrical grid in parallel, through a complimentary operation, creating a consistent and manageable flow of electricity without stressing the local utility or completely draining the battery. When demand goes down, supply is directed to the Battery Storage; when demand goes up, the incremental load is then drawn from the battery storage.

Batteries of this size could lead to the displacement of natural gas as the preferred heating source for homes.

The advantage of this approach is:

  1. There is less risk to the utility and regulators to upgrade their system.
    1. The energy delivered to the resident is more predictable so the threat of lost revenue to the utility is reduced if not eliminated. This should result in lower delivery charges and avoid the risk of stranded assets for the wire service provider.
    2. The grid profile is flattened, reducing the demand for peaking generation, which leads to more secured revenue to generators driving lower energy costs.
  2. The residential battery system can still complement a solar system, but the payback is potentially much better than for a solar system alone as it now helps support larger load system in the home.
  3. The battery system offers a new energy component and services utilities can provide should natural gas be displaced.
  4. As gas assets held by the utility as well as the consumer reach End of Life, an alternative system can be leveraged without the need to invest in technology that continues to be questioned as socially acceptable. Will you be able to replace your gas furnace with an electric furnace and heat pump augmented by a Battery storage system? Maybe …

Utilities are exploring battery storage solutions to dampen the volatility of solar and wind, but it does not address the physical limitation of getting energy to the residential consumer the last 100m.

As consumers change their usage patterns by adding electric heat (and cooling) as well as electric vehicle charging to their consumption profile, the night time peaks will get larger when solar is not available and wind remains unpredictable. Battery storage will help flatten the usage pattern, displacing some of the expensive spinning reserves to become more like base loaded generation, helping to keep electricity energy costs low.

With growing demand for air conditioning and EV charging, it is only a matter of time before residential battery storage becomes another essential appliance, like the furnace and hot water tank. Tesla and Eguana are banking on it. And so, the gap is closing faster than we realize.

As noted earlier, the energy needed for space heating will always be the highest for our geographical climate.

Is the threat of battery technology the catalyst for utilities to expand their services into something different? How will industry respond to this Disruptive Technology? Or does it position an opportunity for new businesses to service the changing consumer needs to supply that energy? Only time will tell, but it is prime for the picking.

DISCLAIMER

This paper is the work and opinion of the author only and is not to be interpreted as a position of current or past employers or their affiliates. The author shall not be liable for any claims for loss, damages or costs, of any kind whatsoever, arising for the errors, inaccuracies or incompleteness of the information or references made in this paper or any loss, damage or costs that may arise from the use or interpretation of this paper.

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About the Author:

Terry D. Rendflesh is a Professional Engineer registered in Alberta and Ontario, Canada. He holds a B.Sc. in Electrical Engineering from the University of Alberta and had held his Certified Energy Manager designation from the Association for Energy Engineers for over 10 years. He has over 30 years of Oil and Gas related experience in which he was involved in detailed design, construction and operations of gas and liquid pipeline facilities and commercial buildings. He held various roles in which he helped industry leverage the changes in a deregulated electricity market to optimize cost. He exploits the methodology of Value Management/Value Engineering to enhance industrial and commercial designs and rationalize the deployment of new technology.

His guiding principle is one that seeks balance between capitalistic opportunities and social responsibility to which everyone can benefit. He has a keen sense of identifying innovation that is unique and unconventional but often key to the evolution of new technology. He has personal experience in the design and deployment of Solar Thermal and SolarPV hybrid technologies. His interests include Energy Management and Renewable Energy Technology at the commercial & industrial level as well as for the retail consumer.

The City of Calgary’s Cash Cow Needs Wrangling

· · 1 Comment Consumer Info, Electricity, Interesting

Problems and Solutions: We are all in for a rough time ahead in the energy sector. If you understand the problems, the solutions may be easier to digest. Albertans are resilient, yet at the same time we need our political leaders to make tough decisions and spend our tax dollars wisely.

Everyone knows the harsh reality, that in Calgary, unemployment runs high. Over 25% of the office space in downtown towers sit empty. Good paying jobs in the electricity industry have been outsourced. ENMAX, ATCO and Direct Energy have all shipped jobs to companies either in India, the Philippines, Guatemala, or the United States. But what are we doing to solve this problem?

Not only have jobs been outsourced, utility assets are being sold off to foreign companies. In 2018 Direct Energy sold off its Alberta natural gas holdings to a consortium out of China. ATCO as well sold off their Information Technology division (ATCO iTek) to a company in India. AltaGas has started to liquidate and in 2019 is targeting the sale of additional assets with the intent of regaining its financial strength and focus on its midstream and U.S. utilities business. Sadly, stories like this are becoming more and more common.

The utility market is complicated and an expensive commitment. To put this into perspective, the provincial government’s green strategy needs an estimated $25 billion dollars of investment in generation by 2030. To attract investment dollars the province has been convinced that it needs to offer revenue certainty to investors if new generation is going to be built to replace the coal plants that are being closed.

Next on the horizon, Bill 13 is scheduled to be implemented in 2021. This ‘Capacity Payment’ mechanism will be designed to guarantee a fixed payment to generators, thus providing long-run revenue certainty. The prime objective of the new market design is premised on resource adequacy and minimizing price volatility. This comes at a cost of potentially higher overall cost and shifting some of the investment risks to consumers as well as higher administrative burdens. The bottom line; consumer prices will more than likely go up.

Closing and mothballing coal plants prematurely destabilized the market and increased volatility in energy prices. Over the last 12 months the cost of electricity has more than doubled. Given the current political uncertainty, plus the willingness of the government to subsidize anything that is green, it is understandable that communities and corporations are lining up for the freebie prior to committing to invest their own money. Hundreds of millions will simply disappear: much of which is funded out of the Carbon Tax (aka the consumers back pocket).

In the Oil and Gas sector, our premier is now being called upon to make one very tough decision: curtail oil production to try to reduce the surplus and pump up wholesale prices. It is argued that this is a wise decision, but is it enough? Next on the horizon, the premier is considering subsidizing the building of refineries.

There is an interesting parallel to the new Oil & Gas strategy when you look at what is happening in the electricity industry: let’s remember that we closed coal plants and paid out $2 billion in penalties. By shorting the wholesale market supply, the cost of electricity increased by over 100% between 2017 and 2018. In a poorly designed policy, in order to try to soften the blow of higher regulated electricity retail prices, the government started subsidizing the utilities in an effort to cap the regulated retail rate at 6.8 cents/kWh. This subsidy isn’t being fairly distributed as it only goes to utilities providing regulated rates and the other half of the consumers in the province get nothing. Over the life of the policy, it could cost taxpayers upwards of $700 million. Pyramiding subsidies, deficit financing and adding to the provincial debt, plus expecting consumers to pay the bill needs to stop.  

With all of this said, our political leaders, both provincial and municipal have never before been so challenged. Politicians inevitably will fall back on adding to the deficit, increasing taxation and spending our tax dollars on subsidies. This is a classic formula; until the working people run out of money to pay the taxes. And if the Carbon Tax is rolled back – who is going to pay for all the subsidies that the government is handing out?

Calgarians are now facing the next problem: increased property taxes. This year, home owners will face a 3.45% tax hike and business owners will see about a 10% increase. As a point of reference, the property tax on our office in Inglewood has increased 100% between 2014 and 2018. Small businesses no doubt will feel the sting of another increase this year.

The mayor of Calgary and our Premier have a tough job ahead. We all need to pitch in and offer our politicians some practical solutions, but will they listen to our suggestions? With the above as a backdrop, lets take a look at Calgary’s crown jewel; ENMAX.

Calgary’s Cash Cow

ENMAX suffered a Net Operating Loss of just under $140 million last year on revenue of $3 billion. Dividends paid to the city are down from $60 million in 2013 to $40 million today. Why is ENMAX running in the red? Why are dividends down by 30%?

Looking back a dozen years, the long-term debt of our city utility was comfortably being managed when it was in the range of $400 million. Today this has ballooned to over $1.7 billion.

Yet the outlook remains positive in the corporate offices at ENMAX, even in today’s challenging market as the utility faces; higher systems costs, aging infrastructure, increases in operational costs, discounting retail prices and reduced electricity margins, taxation challenges, and several disputes with counterparties. Are our city councillors willing to sit back and watch the debt increase and dividends decline?

Here are five possible solutions Mayor Nenshi may want to consider:

  1. Sell ENMAX. This is a good time to sell off the retail sector of ENMAX and keep the lucrative wires and transmission business. This would reduce the city’s debt, focus on job creation, and bring jobs that were exported out of country back to Calgary. Use the profits on the sale of ENMAX to invest in the city in an effort to try to re-create a positive investment climate. Consolidate and re-Invest. As a point of reference, this is exactly what firms like AltaGas are doing right now – and the shareholders were rewarded with an increase in stock value. It is a wise strategy for the city to seriously consider.
  1. Reduce Taxes. In review of ENMAX’s financial statements, there is hidden tax collected by ENMAX and paid to the city under the heading of Local Access Fees (LAF). During the first nine months of 2018, the city of Calgary has collected $103 million from consumers in Calgary, up from $67.5 million paid by consumers in 2016 (+ 50% increase in two years). The Local Access Fee (LAF) is a fee paid by consumers and set in agreement with the City of Calgary in lieu of property taxes and other fees or charges payable to the City by ENMAX Power.

Consumers can find the LAF on their monthly utility bill. Ask yourself, is the LAF charged to consumers by Calgary reasonable? To answer this question, consider that a typical electricity customer in Calgary pays 125% more than a consumer in Edmonton. In some areas in Alberta residents pay zero, and residents in the Town of Milo actually get a rebate. Recommendation: follow the formula established in other municipalities and help Calgarians reduce the tax burden paid on electricity consumption by redesigning the Local Access Fee.

  1. Move off of the RRO. We can save hundreds of millions of dollars if consumers simply get off of the regulated rate. If they did this, the regulators wouldn’t need to artificially subsidize the profit margin of ENMAX and other utilities, money which comes out of the Carbon Tax.

If you want to help Calgarians, they should be encouraged to get off the Regulated Utility Rate and sign up for a competitive rate today. If customers want to stay with ENMAX they should be encouraged to do so – and simply move over to the EasyMax arm of the company. Consumers will save on their electricity bill and carbon tax money can be spent on programs, more important than guaranteeing the profit margin of the utility. Alternatively, there are over 20 Energy Marketers in Alberta, like Park Power, all selling electricity below the subsidized cap. Everyone wins and we can stop wasting Carbon Tax dollars.

  1. Stop predatory business practices. In an attempt to pick up consumer market share, ENMAX, while wearing its EasyMax hat, has been gifting away money in a promotional strategy. At the same time, the corporation is often rumoured to bid on energy contracts below market value in order to undercut the competition. Predatory pricing designed to drive competition out of the local market is simply wrong; especially when at the same time you are increasing our business tax, the money of which indirectly is being used to compete against private sector retailers like Park Power. Is it any wonder that companies are leaving Calgary and the province of Alberta?

If ENMAX has money to spare, it should be fulfilling its civic responsibility and increasing its dividends to the city. The mayor needs to wrangle the city’s cash cow.

  1. Support local jobs: Over the years, ENMAX has shipped jobs out of the country. Today, they are using Tata Consultancy Services (TCS), a massive multinational company headquartered in Mumbai, India for back-end technology support jobs. This move has been justified by leadership as a way to compete on the same playing field as other corporations. We have many talented people living in Calgary who need jobs, we need to bring the jobs back home.

Searching for Greener Pastures?

ATCO is currently diversifying and recently invested in plans to build a new generation plant in Mexico, as well as investments in South America. EPCOR moved money out of Edmonton and purchased water utilities in the United States. Given that ATCO and EPCOR have money to invest – maybe they could be encouraged to buy ENMAX rather than hunting for greener pastures outside of the country. Hopefully ENMAX doesn’t add to our debt load by trying to follow EPCOR into the States and buying a utility down south.

Mayor Nenshi can help consumers lower their taxes by simply restructuring the Local Access Fees, can offer some good advice for consumers to jump off of the government Regulated Option Rate Option (RRO) for electricity, bring jobs back to Canada that ENMAX has sent offshore, and promote the theme “Shop Locally”.

All problems have a solution. It is time for tough decisions and we need political leaders who are willing to think out of the box. Reduce taxes. Reduce subsidies. Reduce debt.

Pre-pay Your Electricity & Natural Gas Bills and Earn Rewards

· · Leave a Comment Consumer Info, Electricity

You asked, we listened!

 

Good news! If you own a smart phone, we have a new credit card pre-payment option for you to take advantage of. Now you can earn reward points by pre-paying your electricity and natural gas bills. 

 

We are proud to announce that customers, in addition to using pre-authorized debit, now have the ability to use Mastercard and VISA to submit pre-payments on their account, thanks to an innovative app created by Paytm Canada.  

 

We have signed a credit card payment agreement with Paytm Canada, an internationally recognized payments and financial services company. Get the app for free at Apple App Store or get it on Google Play.

 

This is a mobile application that allows customers to pay their bills using multiple payment options, earn cash back rewards from Paytm, and credit card points via their smartphone.

 

“Paytm was launched so that everyone – no matter their annual/monthly/weekly income – has access to everything with the convenience of their smartphone,” said Naqiyah Rampuri, Director, Growth Strategy at Paytm. “Paying a bill is a necessity. We wanted to make the experience as seamless and rewarding as we possibly could.”

 

At Park Power, being a small local company has always provided us the benefit of being nimble and able to act on customer feedback and suggestions quickly and efficiently. We are focused on providing value for our customers while offering the best service we can.

 

Switch over to Park Power and earn points; with just one click.

 

The Paytm Canada application is unique in that it is free to download and use. Plus, users earn rewards points for each transaction made through the app which can later be redeemed for rewards from popular brands like UBER, Tim Hortons, Skip the Dishes, Amazon.ca, Ikea, and more.

 

You can use the app to pay for all of your bills in one place including your insurance, cable, taxes, internet, and more. The platform is continually improving and new features are being added on a regular basis.

 

“Paytm Canada is improving modernizing the experience of managing day-to-day finances for Canadians,” said Harinder Takhar, CEO, Paytm Canada. “We will continue to build secure and digital products and services that promote a rewarding experience.”

 

The icing on top of the cake is that users not only earn Paytm Canada rewards points, but if their credit card has a rewards points system, those are earned as well. Plus, with Paytm’s new “Set It and Forget It” feature, users can set up automatic recurring payments, which means an even more convenient way to pre-pay.

 

“Paytm has been a great addition to our service offering and I believe it will be a big hit with our customers,” said Kris Kasawski. “Everyone needs to pay for essential services such as electricity and natural gas, so why not earn rewards at the same time?”

 

 

How it Works

 

Park Power’s pre-payment program is just that, a pre-payment on your account.

 

First, figure out the best day to make your pre-payment by checking when your last billing notification email was received. Make your pre-payment for the next month, at least 10 business days before this day. (Example: if your billing notification was received November 15, set your pre-payment to be sent no later than December 3).

Next, check that same billing notification and see how much you paid that month. Use this amount as a guideline to how much you decide to pre-pay each month. Download the Paytm Canada app for free on your smart phone, create an account, and find Park Power listed under “Utilities”.

 

Enter the amount you would like to pre-pay and your account number (also found on your billing notification). Choose to either pay once, or schedule an automatic recurring pre-payment using the “set it or forget it” feature.

 

Review your details and pay. The pre-payment will be added to your account and the credit will be applied to your next invoice. Keep in mind that Paytm now charges a 2% convenience fee for credit card transactions.

 

Didn’t pre-pay enough to cover the next round of charges, or pre-paid a bit too much? No problem, if your charges are more than the credit we have on your account, the difference will be debited from your bank account using the banking information provided during enrollment, just like we do today. Any additional credit will be carried over on your account, and applied to your next round of charges.

 

More Value-Added Services

Paytm is just one of the many value-added services that we are proud to offer our customers to help make getting their electricity and natural gas easier. Some of the other customer centric programs we offer that you may not be aware of include:

 

Budget Billing: pay a set price each month based on historical usage data and true-up twice annually.

 

Pick a Date: Choose what day of the month you pay your energy bill. Schedule payments so they are convenient to you. (Some conditions apply).

 

Green Energy Options: In partnership with Green Alberta Energy, green any percentage of the electricity you consume.

 

Micro-generation Premiums: Solar PV micro-generation customers can tak advantage of our Solar Club Program to help them earn more from their system.

 

No risk, flexible plans: Our flexible electricity plans require only a 10-day rolling commitment from you and our guarantee is that those rates will stay the same until the end of the specified term (EX: end of December 2024).

 

To start using Paytm, download that app from the Apple App Store or get it on Google Play. For more information on Park Power’s partnership with Paytm click here.

Five Years As An Alberta Electricity & Natural Gas Provider

· · Leave a Comment Consumer Info, Electricity, Interesting

November 1, 2018 marked 5 years since Park Power launched onto the Alberta utilities market.  First as an electricity only provider and now offering natural gas and green energy to Albertans as well.  As with most entrepreneurial journeys, these past 5 years have had their ups and downs but I am happy to say that my journey continues as Park Power continues to grow.

To mark this milestone I thought I would put down some thoughts about what it’s been like to compete on Alberta’s utility markets against some really large incumbents.

  • Even though the Alberta electricity market has been open to competition since 2001, lots of consumers are still uninformed about the choices they have when paying their electricity and natural gas bills.  When I started promoting my business I would say that 50% of my time was spent educating the consumer about how the different sectors of the market functioned and that a consumer’s choice in provider did not affect the delivery of power or gas to their home or business.  These days I would say that consumers are getting more informed thanks in part to the work of the Office of the Utilities Consumer Advocate.  I also believe consumers are gaining knowledge due to the fact that our industry is undergoing some changes and as such is on the minds of Albertans more.
  • While Albertans are becoming more informed about the choices they have in the utilities market, it’s not the most exciting subject to think and talk about, therefore it’s not always top of mind for consumers.  As such I have learned to be patient with the consumer.  I understand that choosing a new electricity and natural gas provider may not be top priority for everyone most of the time.  So instead of using fearful sales tactics at your door during supper time to get you thinking about your energy bills, I have created a positive, community minded brand that might even make you smile when you think about electricity and natural gas.  So even as brand awareness and the customer base of Park Power continues to grow, I remain patient with the consumer because I am confident that Park Power is a better choice.
  • I came into this business with an Degree in Economics, 15 years working in small retail businesses, and the gumption to give it a go.  After 5 years I believe I can say that Park Power is capable of competing with the large, traditional incumbents who have pockets much deeper than mine.   This ability to compete is thanks in part to my branding and marketing efforts but also thanks to the great services and back office network provided by UtilityNet.  By operating in a business model that is more efficient with less overhead, Park Power is able to offer its customers low rates, with awesome Alberta based customer service, all while sharing our profits with awesome Alberta Charities.
  • Kindness matters, this rings true in life and business and for my business it has been a cornerstone.  I aim for Park Power to be a positive member of the community and as the face of the business I can leave a positive brand impression by being genuine and showing kindness.   I have built some great business relationships because of the positivity that I promote through Park Power.  It is heartening to know that building a brand with kindness in mind has created brand value that resonates with our customers.

These past 5 years have been a ride and I look forward to it continuing.

Many thanks to all the wonderful residences and business that have become Park Power customers.  Your continued support allows me to keep spreading the #localpower message and allows Park Power’s community contributions to get bigger every year.

 

 

 

Local Electricity & Natural Gas Companies Offering More Value for Less than Large Regulated Utilities

· · Leave a Comment Consumer Info, Electricity

In 2009 UtilityNet decided to open their own electricity retail shop. The goal was simple, to offer electricity, natural gas, and green energy to Albertans for less. People told them they were crazy and that no one could compete with the incumbent government utilities.

They begged to differ and became the first local Energy Marketer to compete against the big retailers and subsidized regulated utilities. Today, over 20 other companies have joined us. This collective group of companies is known as the Peoples Utility, and was created with Albertans in mind.

When the Energy Marketer Model was started, UtilityNet knew they wanted to be different than the large Regulated Rate Utilities that dominated the market. They knew we wanted to be better.

Today, collectively our group now has customers in over 300 Alberta communities. We are focused on our local community but can offer services throughout all of Alberta. Most importantly, Park  Power’s guaranteed rates are lower than the government capped Regulated Rate Option (RRO). No one can compete with government utilities? We have proven that it is possible!

We are focused on providing local customer services; lower energy rates; educating consumers on the energy market; providing innovative services; and, un-complicating the complexities of buying energy.

We firmly believe that buying energy in Alberta should be simple, hassle free, with open contracts, with zero penalties, and fairly priced. Most importantly, we believe that provincial regulated utilities should not be allowed to ship jobs offshore and receive carbon tax dollar subsidies to help guarantee their profit margins.

Innovation Without Borders

Part of our strive to be different is our commitment to innovation. We are proud to offer a number of customer centric programs, most of which are unique to companies like us in the new People’s Utility.

Some of these programs include:

  • No exit fees: customers can leave or change rates with just 10 days notice with no fears of penalty fees
  • Energy options that include both variable and low guaranteed rates that protect consumers from price fluctuations
  • Special and lower rates for seniors
  • A strong community focused program of giving back to those in our local neighborhood
  • Pick-a-date program: letting our customers pick the date when they pay their utility bill
  • Budget billing: to help customers better manage their household expenses
  • A unique loyalty payment program which allows customers to earn rewards points
  • A number of green energy options focusing on the future

Many of these programs have been ignored by the large regulated utilities. This is what makes us different.

Concerned About the Future

Today, the private sector and other businesses like ours have never been more at risk. Current government policies, subsidies, and outsourcing (under this government and the previous governments) has had a major negative impact on the future health of our industry.

Alberta’s electricity market is going through a restructuring. The province will phase out coal-fired power plants and try to reach a goal of 30% of electricity generation coming from renewable sources by 2030. This transition could be expensive. The first major expenditure Albertans encountered on our way down this path was the cancellation fees of the Power Purchase Agreements (PPAs), which totalled $2.25 billion. This is money that the government had to borrow and loan to Alberta’s Balancing pool to keep it afloat. Additionally, to try to encourage more investment in Alberta’s power market, a new capacity market, which will guarantee those participating a guaranteed base income stream, will be introduced in 2021. In the end, consumers will be on the hook for all the extra costs that could arise.

With new policies already in the works, electricity prices have become unstable and an increase in prices has begun. In preparation for this the government has introduced a subsidy on the Regulated Rate Option (RRO). Regulated Rate providers like ENMAX, EPCOR, and Direct Energy are receiving millions of dollars in subsidies to keep their rates artificially at 6.8 cents/kWh. Funding for this subsidy is coming out of the Carbon Tax. Over $70 Million in subsidies estimated this fiscal year alone.

Why are we concerned? This policy is tilting the playing field towards the RRO utilities and away from small independent companies like ours. Additionally, many of the RRO utilities who are being subsidized are some of the same companies that have outsourced hundreds of jobs outside of Canada.

Regulated Utilities Cut Costs, Increase Profits and Ship Jobs Out of Alberta

Have you ever heard of the Local Multiplier 3 (LM3)? It was developed by the New Economic Foundation as a simple and understandable way of measuring local economic impact. The multiplier effect measures the number of times a dollar circulates within an economy. It was developed on the idea of the ‘leaky bucket’.

Think of this: ATCO outsourced over a billion dollars when they signed a 10-year deal with Wipro, a company out of India. $120 million a year. Direct Energy did the same and even sold off all their natural gas holdings for $722 million to a group from China. To a lesser degree ENMAX did the same by outsourcing their IT jobs to India. How many dollars using the multiplier will be lost to our economy?

If you imagine the local economy as a bucket full of water, every time you spend money that goes outside the local area, it leaks out of the bucket. Generally, our energy is focused on trying to pour more money into an area so as to keep filling up the bucket. However, a better starting point for strengthening the local economy should be to try to prevent the money leaking out in the first place. Remember – the money leaking out is your tax dollars.

Source: The People’s Utility

Last year, during the winter months, the typical homeowner spent about $38 for the natural gas they consumed, and an additional $26 for the carbon tax. This is an effective commodity tax rate of almost 70%.

At Park Power we believe strongly in a path towards a greener future and helping to green Alberta’s electricity grid, which is why we provide an option for our customers to green a percentage of their electricity consumption from 5% all the way up to 100%. But, the current RRO cap, funded by the carbon tax is not doing anything to move us towards a greener economy. We believe the carbon tax dollars should be used for what it was originally intended for.

Want to support a local Albertan company that doesn’t ship jobs out of the province and supports the local community? Sign up with Park Power today.