Your home energy bill just arrived, and something just doesn’t look right. No one likes a high bill, so we’re here to help you get to the bottom of it.
As an Alberta resident, you might’ve noticed that your recent home energy bill is higher than what you’re used to. Some factors, like how much energy you use, are mostly within your household’s control, while others are due to external factors you can’t control.
Read on to learn about all the factors that affect energy prices — and ways you can save.
Quick guide
- Understanding factors that affect your energy bill
- Usage period charges
- Bill payment history
- Statement corrections
- Carbon tax
- Supply & demand
- Winter energy bills
- Summer energy bills
- The current climate of global fuel costs
- Other fees
- What can I do to reduce future bills?
- Improving energy efficiency at home
Understanding factors that affect your energy bill
Your energy bill is a routine expense when running a household, but when the number suddenly skyrockets, it can leave you with more questions than answers. How can my bill be so high? Why did the price go up this season? And what do all these extra fees mean?
If you’ve been noticing higher-than-usual numbers on your most recent bills this season, you’re not alone.
Most common first question
Check to make sure you paid your last bill, and that the payment went through. It may seem silly to point this out, but we get a lot of fellow Albertans who contact us only to find out that their last payment wasn’t showing on their bill.
Usage period charges
Sometimes you might notice that your bill is higher than usual. This could be because the billing period for that particular month was longer than the usual 30 days. Remember, not all months have the same number of days, and this can affect your bill. Also, there may be times when the distribution company adjusts the dates slightly when they read your meter.
You should check the date range mentioned under your Electricity or Natural Gas charges. If it's more than the usual 30 days, that could be why your bill is higher.
Your bill payment history
If you’re noticing a particularly large increase from your last energy bill, take an extra close look at the bill. Is it possible you forgot to pay last month or that the payment isn't showing yet? If the total is much more than the usual amount, this might just be the case.
To find out, check out the Account Summary section of your current bill. The line labelled Balance Forward will show a total of $0 if your last bill was paid in full. Late fees from previous months can also affect your current bill, which may be the reason your bill seems higher than usual.
Statement corrections
Statement corrections happen if a distributor’s estimated consumption calculation is audited and found to be higher or lower than estimated. If a statement correction adds charges to your bill, it means you may have been undercharged in the past. If this is the case, you will see a note on your bill explaining the charge.
Carbon tax
The Federal Carbon Tax, also known as the Federal Fuel Charge, is another line item on your bill that all energy providers, including ATCO Energy, are required to charge. It’s an ongoing charge if you're a natural gas customer. You can expect the rate per GJ to increase on April 1 annually.
Supply and demand
Electricity and natural gas are not exempt from the laws of supply and demand. When there is a surplus of any product and low demand for it, the price of that product will go down. Conversely, when there is a limited supply of a product and high demand for it, that product’s price will go up. Scarcity drives prices up.
We can’t predict the first snow fall, but we can tell you with certainty that when winter cold hits, Albertans use a lot of heat and power to battle the cold and the dark evenings. This spike in demand eats up supply. When the supply of electricity and natural gas goes down, the price goes up.
Energy is no different than other products in terms of supply and demand. One extreme example of low supply and high demand for energy happened on January 3, 2022, when Alberta hit an all-time high record for energy consumption. Albertans cranked their thermostats to combat the deep freeze while unplanned outages toyed with energy supplies. These extreme weather days hit us a few times each year. The daily price of heat and power can go up and down faster than the pump price at your local gas station.
Knowing that supply and demand affects the price of electricity and natural gas, it’s no wonder that many Albertans got a big shock when they opened their monthly invoice. On days when lots of people in Alberta are all using energy at the same time, it costs everyone a lot more for heat and power. This change in energy rates only applies to you if you are on a variable style rate plan. For example, our ATCO Advantage Plan is a variable-rate plan in which your rate fluctuates with the market. In the long run, this type of plan is often more cost effective because you only pay for what you use, and you pay market prices. If you are looking for less fluctuation in your rates, you can consider a guaranteed rate plan.
Winter energy bills
In addition to historically low temperatures and high prices due to supply, the winter months are an expensive time for energy consumption. But the sun shines as bright as ever in the Alberta winter sky, and should be making solar energy even on a cold day, right? Well, it’s complicated.
It takes more heat to keep even a moderate temperature at home when everything outside is frozen solid. If your family likes to be really warm and toasty, it takes even more heat energy to get the whole home feeling cozy. Add the increased demand for supply at the community level, and your high bill starts to make more sense. Plus, some of Alberta’s renewable energy sources like wind generation, do not typically generate power when the temperatures are super cold. This further reduces the overall provincial energy supply when we need it most.
Investigate your energy usage if you want to reduce your winter bill. Can you shorten your hot morning shower? What about reducing the use of your clothes dryer? During the holiday season, perhaps your holiday lighting hours can be reduced to evening only, when they are most vibrant! Heat is important, but there are ways to save energy on some of the extras.
Summer energy bills
You might be surprised to learn that hot summer temperatures can be just as disruptive to energy prices as cold winters. This is becoming increasingly true in Alberta, where more and more residents are installing air conditioners and swimming pools to combat the summer heat. This led to a surge in energy consumption during the hot months.
Wind power goes a long way to filling the gap in Alberta, as the southern regions are famously windy. If wind speeds drop suddenly on a calm summer day, the lack of energy supply leads to higher prices. With 1 in 3 Albertans using air conditioners to keep cool during heat waves, the demand for energy increases, and prices rise accordingly.
If you don’t notice this uptick on your summer energy bills, it might be that you don’t use air conditioning or are home less often. Regardless, the price per unit of energy in the summer may in fact be higher than the rates you paid in the winter, if you’re on a variable or wholesale plan that follows market rates.
Pay attention to summer energy guzzlers like hot tubs, air conditioners, patio heaters, dehumidifiers, or outdoor grills and fireplaces. Reducing your bill means taking a holistic look at how you use energy.
The current climate of global fuel costs
Recently, we’ve witnessed a significant shift in fuel prices. Reduced travel and a surge in remote work led to a decrease in demand and lower fuel prices. However, as the world adjusts to new economic realities, energy prices are experiencing an upturn.
Global uncertainty
Our global economy is going through a period of rebalancing post-economic disruption, with more people returning to their workplaces and driving up demand for energy. Supply chain disruptions across various industries compound this dynamic, adding another layer of uncertainty.
These global factors, coupled with the impacts of international conflicts on commodity prices, will continue to shape the fluctuations of home utility prices in the foreseeable future.
Greater home energy consumption
Most people have been spending a lot more time at home these days. Because of this, home energy consumption is generally trending upward — particularly for those who’ve transitioned to remote or hybrid work schedules.
Inflation
You may have noticed that everything seems to be more expensive these days. It’s not all in your head: Inflation in Canada reached an all-time high in 2022, and experts predict that inflation will remain persistently high until the middle of 2024. Despite inflation and rising energy costs, we aim to keep our rates competitive so you can feel confident you have the best plan in the current market.
While inflation may be affecting groceries, clothing and even rent prices, fuel and electricity are actually some of the least affected areas so far. Here’s hoping it stays that way!
Uncertainty around the globe, higher consumption and inflation will likely affect energy pricing and consumption in 2024 and beyond.
What are all the other fees on my Alberta energy bill?
So... why is electricity so expensive in Alberta? This is because the amount you pay on your energy bill also includes other fees. Sometimes Albertans are surprised to learn how much of their bill is above and beyond the electricity and natural gas their home uses every month.
These other fees can include local or municipal access fees, government fees and taxes such as carbon tax or a rate rider charge, admin fees or plan charges, distribution and transmission charges (D&T), and more.
Let’s shed some light on a key aspect of your bill: the Distribution and Transmission (D&T) charges. These charges cover the delivery of electricity and/or natural gas to your home. These charges will be identical regardless of your energy provider, as all companies are required to include them in their bills. It’s important to note that these fees are regulated by the provincial body, placing them beyond our control.
You see the D&T charges on your bill from ATCO Energy, but they don’t actually come from us, nor do we keep any amount of them. As your energy retailer, we are required to flow through certain costs on your energy bill, at a cost with no mark-up, on behalf of other parties, including the government.
Delivery and Third-Party Charges, or Distribution and Transmission Charges, are labelled as Delivery Charges on your ATCO Energy bill and are dependent on factors like where you live and the energy distributor in your area.
This means these fees would be the same amount on your bill, no matter which energy retailer you use.
Although we try to make your energy bill simple and easy to understand, it’s not always clear what the fees mean. What’s a transmission charge? Is there any way to get out of the carbon tax? Why do I have to pay an administration fee?
While no one loves an extra fee, these expenses help keep your energy services running smoothly. Check out our blog to learn more about the fees on your bill.
What can I do to reduce future bills?
A large portion of your bill depends on where you live: the local distributor in your area, energy infrastructure near you and the number of neighbours sharing energy resources. Unless you’re thinking about moving, your best bet is to make your home as energy efficient as possible and revisit your ATCO Energy plan if necessary. Remember, you can switch and renew your energy plan with us any time with no cancellation penalty!
Improving energy efficiency at home
While Albertans can't easily change external factors like who their distributor is, or the balance between energy supply and demand within the province, the good news is that there are still many ways to lower your monthly energy bill! Energy inefficiencies can account for around 9% of your annual energy costs, so it’s always worth investing in appliances and renovations that can make your home more efficient.
Here are some home energy-efficiency tips that can help you save:
- Learn which appliances drain the most energy in your home. You might be surprised to learn who the biggest electricity guzzlers are!
- Unplug small appliances and gadgets when not in use. Even when switched off, plugged-in electronics drain small amounts of electricity over time, which adds up over time.
- Turn off unnecessary lights.
- Prioritize energy efficiency when buying new appliances. Appliances that are certified energy efficient reduce greenhouse gases, use less water and help you save on your energy bill.
- Working in a home office? Choose lighting that is comfortable and cost-saving with our guide to energy-efficient home office lighting.
- Complete home maintenance as needed. That means prioritizing maintenance that improves energy efficiency, like getting your dryer vents cleaned annually and fixing that leaky tap! Not sure who to call? The pros at ATCO Energy Home Services can help with maintenance, cleaning and energy efficiency — including renewable energy solutions.
- Wash laundry on cold. Not only do cold loads protect your vibrant colours from fading and help clothes last longer but using less energy to heat laundry water will help you save money on your bill!
- Clothes dryers are some of the biggest energy-draining culprits! Air dry wet laundry whenever possible to save.
What if I can’t pay my bill?
Times are tough, and late or missed payments can make an uncertain situation even worse. As fellow Albertans, we’re here for you.
If you anticipate a problem paying your energy bill, give us a call! We’ll learn about your situation and work with you to figure out a solution to help you stay powered with ATCO Energy in the coming months.
Communication is key! If you miss payments or make only partial payments without reaching out to us, your bill may automatically enter the collections process. Avoid this by keeping us in the loop. We’re here to help.
What goes up must come down
There’s no denying that energy prices are high these days. But there is hope for the future. Just as rates can go up, they can also come down. As global energy prices continue to change, we will see rates go up and down. Experts are predicting that rates in Alberta will eventually stabilize and return to something like what we’re used to.
The world of energy is constantly changing, but one thing remains constant - our dedication to providing our customers with the best possible energy plans. We offer reliable service, friendly customer support, and flexible payment options that make managing your energy needs a breeze. Check out our energy plans today and find the perfect fit for your home or business.
