19 Oct 2021

Co-op and Community Gas Distributors

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Co-op and Community natural gas distributors are locally-owned and operated. The locally-elected board (for co-operatives) or council (for municipalities and First Nations) govern the utility on behalf of the co-op members or community ratepayers. Most operate on a non-profit basis, and all operate on the basis that any surpluses are retained within the utility itself (there are no dividends or profits paid out). The rates are set by the board or council, which include the direct cost of gas, and may include fixed and/or variable fees to cover the costs of operating and administering the utility.Co-op and community gas distributors have both the obligation and exclusive right to supply natural gas to customers in their franchise areas. From this legal obligation and exclusive right, for-profit, competitive retailers are not permitted to sell natural gas in co-op or community franchises. The local utility is the retailer and flows-through gas costs to the consumer. The gas costs come from Gas Alberta on a monthly basis. This flow-through nature of the cost doesn’t allow for customers to lock in rates.Through Gas Alberta’s gas procurement process, monthly rates are usually lower than competitive retailers’ fixed price options. Since November 2018, the average end-use consumer of a Federation Member Utility has saved approximately $1,200 through Gas Alberta’s rates as compared to the average of fixed rate options over the same period. Some local utilities may also offer budget bills with a pre-set amount to pay each month.

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