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Utilities Consumer Advocate

How our Regulatory Service Represents You

The Office of the Utilities Consumer Advocate (UCA) represents Alberta residential, farm, and small commercial utility consumers in regulatory hearings before the Alberta Utilities Commission (AUC). Regulated utilities must apply to the AUC for approval of the rates they charge to consumers. The UCA’s primary goal in regulatory hearings is that consumers receive their utility service at the lowest possible cost, consistent with reasonable levels of service.

The UCA collaborates with other consumer agencies and organizations to make the most efficient and effective use of  consumers’ money

The costs of regulatory proceedings, including all approved legal and consultant fees for interveners, are absorbed through utility rates. As this is passed on to consumers, it is important they receive good value for these costs, as well as for all other utility operational expenses.

The UCA's interventions in utility applications are directed by a Governance Advisory Board comprised of representatives of the Alberta Urban Municipalities Association, Association of Alberta Municipal Districts and Counties, Alberta Federation of Rural Electrification Associations, Federation of Alberta Gas Cooperatives, City of Edmonton, City of Calgary and Alberta Chambers of Commerce. In addition to collaborating with these groups, the UCA also works with other organizations on specific proceedings when a common approach is possible. This helps to reduce duplication of intervener efforts and regulatory hearing costs.
 
Since the UCA’s inception in 2003, it has participated in interventions that have saved consumers over $400 million through reductions to utilities’ requested rates. Below are a few examples of results achieved in 2008 through united collaboration at utility rate hearings before the Alberta Utilities Commission:

The UCA is working to improve the efficiency of the regulatory process through a number of initiatives. For instance, the UCA took a lead role in the creation of a Uniform System of Accounts and Minimum Filing Requirements (USA/MFR) for electrical utilities. The USA/MFR, when fully in place, will improve and streamline the evaluation of electric utility rate applications. It has also been a strong advocate of a performance-based regulation to provide Alberta regulated utilities with incentives to improve customer service. The UCA will continue to advance changes in regulatory approaches that contribute to maintaining reasonable customer rates.

How your utility rates are set

Regulated utilities are different from most other businesses in that they have a monopoly within their service areas and other businesses are not allowed to provide competitive services. Even in the restructured energy market, this is still true. The companies that provide the infrastructure (wires, pipes and associated equipment) used to distribute electricity and natural gas are still monopolies. Only the sale of the electricity and natural gas commodities has been opened to competition. The distribution of these commodities remains regulated.

Regulated utilities must apply for AUC approval of their rates to ensure they are just and reasonable. Utilities are allowed to recover reasonable capital and operating expenses, including taxes, plus an approved return on capital investment. The AUC’s hearing process reviews the utility's actual and forecast expenses and sales volumes. Using this information, the AUC then determines a reasonable level of expenses and the total amount of revenue the utility can collect from customers. The revenue amount is divided between customer classes to determine the rates for each customer group. This allocation is largely based on the cost to serve customers in each classification.

 
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