Out of balance?

[Horse]

I see on the news direct energy is asking for a rate increase to $15/GJ that will put heating bills at or around $400 / mo in winter. Sure is going to be hell on a lot of seniors and low income familys.If you work in the energy sector I guess you are alright.
I think this spread between low and high income earners is getting way out of line.

[silverback]

Are you saying that the people working for the gas companies are getting it cheaper than you are?

I can't see anything stopping you from starting a career at a energy company is there?

[cowman]

I believe the Alberta Government is giving a rebate that brings the actual rate back down to about $8.30/g? They can afford to do this because the money is rolling in from all the NG heading to the States? Golly, Horse I guess you actually are benifitting from the oil and gas industry? About $7.25/gigajoule?
Be happy you aren't paying the American price! The oil and gas industry is subsidizing you!

[cowman]

Even with the subsidies natural gas is costly and certainly a burden to many folks. I had a pellet heater installed in my home and even with the cost of pellets my heating bill is less than last year.
A humidifier is a must with a pellet heater because the fan runs constantly but it is clean smoke free heat and I am happy with it.
Utility costs are certainly an issue, I guess we can be thankful for the warm weather which is a plus.

[cakadu]

Given that we are being paid back with our own money, cowman, I don't really see that as any great consolation. Direct Energy is applying for an increase that will see natural gas rise to $15/gigajoule. Who is really benefitting from the rebate?

Wouldn't it be wonderful if every time producers saw a need to get an increase - whether warranted or not - they could go before a panel, plead their case and get the increase?

[cowman]

Well Direct Energy will get the $15 plus one way or the other? If the utilities board doesn't want to give them that then I guess it could go to the States?
The fact is the Alberta consumer is being subsidized by the government. The gas company sells to the best buyer and it is up to the regulated utility companies to get their money however they can?

[cakadu]

Cowman, yes we are being subsidized by our own money - it is NOT the government's money - it belongs to us. An analogy would be going out and buying your own Christmas present. You might get what you want, but it is still coming from you.

It seems to me that it is like the chicken and egg thing - if they didn't allow the companies to get their asking price every time - they wouldn't need to subsidize us. This seems to be just another way to get us to lock into rates - no matter what it means to us.

Emrald is so right about the fact that no matter how much we get "subsidized" there are those who are hard pressed to make the payments. Think about seniors and those who are on fixed incomes - they need to stay warm too.

Yes, the companies have the right to sell it where they want, but there are things that they always take advantage of i.e. hurricanes, tsunamis etc., whether or not it is justifiable.

[cakadu]

governments love to have people 'think' that the money comes from the generous government but as Linda says, it is the peoples money coming from fact that the province has reaped the benefits from the people's resources. Waving signs that say the Province is DEBT FREE is small consolation to families that are choosing to heat their homes, pay rent or put food on the table, and yes, in this province of plenty, there are those who aren't rolling in wealth.

Working poor, who through no fault of their own aren't making the huge income that many take for granted these days. Single parent families and even many dads that have been forced to leave their homes, are feeling the pinch when support payments are taking most of their income leaving very little to keep a roof over their own head.
I know of many people in this province, including many of our farm families that are struggling to make ends meet, and even with the natural gas rebates are having a very difficult time keeping bills paid. We were all hit with the high cost of gasoline in the fall, many people have no choice but to drive to their workplace and aren't compensated for that cost. High heating bills coming right after high gasoline prices are a hardship that really doesn't make much sense in this province where resources rule !!!!

[Horse]

Cowman what a crock this is a very big money game and we as consumers are the pawns It is not so easy to get a job or contract as the bids are by invitation and they are sure to keep the family as small as posible.
Where it starts to run off the rails is the royalty rate then with 8 or more billion surplus why are we getting only 1.4 bill handout from gov. They think it is thier own to buy votes as they choose and those that draw oil wages and contracts sure arnt going to argue .
If it was as you say and wages are market driven . I am dam sure there are a lot of people that would work for less than the going rate but there is no free market.
Like I have said look at Fort McMuray and see wages are high but so is the cost of living and it is up to all citizens to make a few business people very rich wheather or not we make the big coin.

[cowman]

The price of natural gas is set on a North American market? The Alberta government can NOT sell NG to Albertans cheaper than they can to Californians...its called NAFTA?
The regulated utilities apply for a certain rate? They don't set their price wherever they want? They buy on the open market, add on their expenses, and a profit...and ask the government to approve that rate? The government approves or doesn't approve that rate?
The fact is this: NG is worth $15/gigajoule...that is the going rate? If the government could(and it can't) lower the North American price for Albertans, there would go the gas business in Alberta! Not only would that be unfair to everyone in Alberta but it would send a signal that we are "Saskatchewan west" and not a good business environment! Also consider this: The government of Alberta(the people of Alberta) does not own all the NG coming out of the ground? A fair portion is freehold. Now you are going to dictate what the freeholders get for their gas?
Why not take it a step further down the old communist road and make it mandatory that farmers only recieve 50 cents for their fat steers? After all poor hungry Albertans deserve cheap food, too?
Luckily we still live in a country that has a market economy? Every person has the right to spend their money and time as they basically see fit? Without a doubt some people have a tough time of it...sometimes through no fault of their own. But the fact is if we penalize those who succeed, we will end up with a country of losers where no will will even try? Think of the former USSR or communist Poland...is that where we want to be?

[farmers_son]

Cowman has raised some very good points. NAFTA did take away Canada’s natural advantage of having oil and gas resources under its lands. Before NAFTA Canada did have in place energy policies that in effect created an advantage for Canadians with Canadian oil and gas. NAFTA took that all away. NAFTA in effect moved all the oil and gas under Canada and shifted it into the United States because after all if you have unrestricted access to something you basically own it. The U.S. does not care about the price of energy because the money basically all flows back to them anyway. Albertans and Canadians are really ill informed to think of “their” energy, the Americans have it all. Think of NAFTA as the U.S. directionally drilling into the heart of Alberta and pumping all of what was our energy south of the border.

NAFTA took away Canadians and Albertans birth right, the energy gift we were blessed with has been handed over to the Americans. We did this for free trade and in case you all have forgotten, the Yankees are still not buying our cows and cow beef. Maybe in 2007, this is still 2005.

Is that an example of a market economy? Is it an example of a market economy when an Alberta farmer sells a cow for $400 less than if that same cow was sold by a Montana rancher yet that Montana rancher drives a new pickup powered by gasoline that came from Alberta and pays less for that gas than we do.

Think of Poland or USSR? Better to think of Mexico because we are going to be no better than Mexicans if NAFTA is in place for another 20 years and our energy advantage is gone. Canada’s opportunity to lever our energy resources into a diversified and powerful economy disappeared with NAFTA. Thanks Brian Mulroney.

[cowman]

Farmers son: You astound me! You have to be the only guy in Alberta who thinks the free trade deal didn't benifit Alberta!
Think about it. Before the free trade deal you got the shaft daily! Everything you bought and sold went through the golden triangle! Yes there has been some trade problems brought on by people ...called R-CALF...and some other protectionist groups but you know very well, in the big picture, that we have made a pile of money out of this deal? Look at the trade figures...who has benifitted? Canada as a whole has kicked butt...in a big way?
Instead of condemning Mulrooney you should be thanking him everyday....maybe not as a farmer(right now)...but as a Canadian? It was one of the few things he did that was right for Canada.

[farmers_son]

I do not think there can be any doubt that NAFTA has been bad for Canadian farmers and Canadian primary industries in general. Canadian farmers are large energy users and did benefit pre NAFTA from a made in Canada cheap energy policy through cheap fuel, fertilizer, electricity and natural gas. Although there is a lot of outrage about the NEP it was about Canada taking ownership of its resources and using those resources to create a competitive advantage for Canadians, not Americans. And while one could point to benefits for the oil industry because of NAFTA for the most part that advantage has not be positive for agriculture.

Canadian farm per unit profitability has decreased since NAFTA, not increased. Since NAFTA the cash to cash live cattle basis between Alberta and Canada has grown wider to the detrmiment of all Canadian cattle producers. Since free trade there are tariffs on our wheat. Yes trade numbers have increased but we are exporting more for less. It is almost three years since our case of BSE yet our cows are still at bargain basement prices even though the U.S. has acknowledged their own case of BSE. Every time I see a cow sell in the market for less than half what that same cow would bring in the U.S. I am reminded of just what NAFTA has or should I say has not done for us.

Prior to NAFTA we were buying machinery, now we have to figure out ways to manage without machinery. Prior to NAFTA we had a choice of a half dozen packing plants to ship fat cattle to, now there is two. Prior to NAFTA we hauled our own grain to a local farmer owned elevator now we have to hire our grain to be shipped across the province to a terminal controlled if not 100% owned by Americans.

We farmers never had to struggle in the early eighties like we struggle today to stay afloat. Where is the NAFTA advantage for us? Trade numbers yes what about net farm incomes. Net farm incomes have been decreasing since NAFTA not increasing. Because of NAFTA the typical farmer and many average Albertans can barely afford to heat their homes when the natural gas is sitting right under our feet.

As I recall when CUSTA (later NAFTA) was proposed all the talk was about loosing our water resources. And while we stood steadfast about protecting our water we let the Americans take our energy. John Turner was right to say CUSTA was bad for Canada.

“Any country that is willing to surrender economic levers inevitably yields levers politically and surrenders a large chunk of its ability to remain a sovereign nation. I don't believe our future depends on our yielding those economic levers of sovereignty to become a junior partner in Fortress North America to the United States."
John Napier Turner, October 12,1988

If NAFTA worked, our cull cows should be worth 60 cents a pound not 15-25 cents.

[FarmRanger]

Yikes f_s, do you have your tongue in your cheek? You forgot the little winky face beside your post. We sell as much oil to the U.S. as we want, at the WORLD price, which has benefited us very well. The reason we pay more for gas here has nothing to do with undercharging the Americans. It has everything to do with the overtaxing (gouging, putting a drag on our competitiveness, you pick the words, they’re all true) of our own citizens to fund bloated government largess. Fuel is heavily taxed in Canada, it has nothing at all to do with free trade. The tax was supposed to pay for your taxdollar purchase of Petrofina, which incidently also had a huge increase in share price (doubling I believe?) before the Liberal government of the time announced a deal to purchase it costing the taxpayer extra billions (Déjà vu with the income trusts?). The tax was supposed to be removed when Petro-Canada was paid for, and fuel was supposed to be cheaper because of a state owned oil company. Neither happened. Someone got rich, but it wasn’t the Canadian taxpayer.

Quote from http://www.agr.gc.ca/itpd-dpci/english/trade_agr/fta.htm “The Canada-United States Free Trade Agreement (FTA) came into effect on January 1, 1989. The FTA provided for the gradual elimination of tariffs and reductions in non-tariff trade barriers on goods. On January 1, 1998, all tariffs on Canada and U.S. origin goods were eliminated, with the exception of a limited number of over-quota tariffs associated with tariff quotas on some agricultural products. These tariff quotas replaced earlier non-tariff measures and were implemented by both the U.S. and Canada in 1995 as part of the outcome of the Uruguay Round of multilateral trade negotiations. The Agreement also incorporated more effective dispute settlement processes.” Endquote

I guess some would like to argue that the unlimited ability to impose tariffs is a good thing, but simple economics has shown that tariffs hurt the country imposing them as well as the tariffed country. Case in point, the great depression of the 1930s.

While dispute settlement processes aren’t foolproof, they’re still better than none at all; especially with the Liberal government badmouthing Americans at every opportunity, for not so cheap political gain, at our expense.

[cowman]

Well Farm Ranger pretty well said it all? I rest my case.