Maritime Electric, P.E.I. government apply for rate increase of 7% over 3 years

A new general rate agreement between the P.E.I. government and Maritime Electric proposes an increase of 2.3 per cent for a typical residential power customer in each of the next three years.

That's a total increase of about 7%per cent about $2.60 a month per customer until March 2019.

Officials say the new agreement, which is currently before the Island Regulatory and Appeals Commission for approval, will keep electricity rates stable for the next three years.

"We believe this approach secures the best price for our customers and helps them plan for the future," said Fred O'Brien, MaritimeElectric CEO in a news release Friday.

"This agreement allows for continued investment in on-Island operations to ensure that we continue to deliver safe, least cost, reliable electricity to our customers."

The increase is needed due to the costs of the new underwater cable, inflation of production costs, and aging equipment, including the planned closure of the Charlottetown thermal plant, said Maritime Electric.

The agreement includes abandoning a plan to build a new generator in Charlottetown.

• $54M P.E.I. underwater power cable contract goes to Korean company
• Maritime Electric's generator plan approved by consultant

"As we work towards a new provincial energy strategy, this proposal allows Islanders to have stable rates and the opportunity to continue to explore long-term policies, programs and approaches to energy and sustainability for the province," said Minister of Transportation, Infrastructure and Energy Paula Biggar.

Maritime Electric said it will continue to study residential rates and will file a report with IRAC by April 2018.