With 1 in 5 Albertans struggling to pay their electricity bills, the question of energy affordability needs a re-frame.
Overview
Alberta's electricity system has entered a significant period of growth to meet rising demand, which is expected to continue through to 2050.
Given this growth and the investments required to achieve it, a significant part of the energy affordability challenge is stabilizing electricity delivery costs so electricity bill increases are minimized as new infrastructure is deployed.
AEF solution teams are developing interventions that can support both acute and chronic affordability challenges.
Why It Matters
261,750
current Alberta households experiencing energy poverty
$22-32M
estimated annual economic burden of arrears, bad debt, and disconnections in Alberta, a portion of which is related to energy poverty
97,000
seniors experiencing energy poverty in Alberta
What is energy poverty?
We define energy poverty as the struggle to afford the energy needed to adequately heat, cool and power a home. Households spending 6% or more of their after tax income on energy needs are classified as experiencing energy poverty.
Energy poverty is typically the result of 3 things:
1
2
3
Low Income
Low and fixed incomes leave little room for energy bills. Seniors, newcomers, renters and single-parent families are most exposed.
Inefficient Housing
Older, under-insulated dwellings built to minimum code, with aging furnaces, are costly to heat and cool — and owners cannot afford to fix them.
High Energy Bills
Energy bills in Alberta are impacted by the energy price, delivery charges, and administration fees. Adjusting energy rates alone will not resolve the issue of unaffordability.
Who experiences energy poverty?
The face of energy poverty is consistent: seniors and older homes dominate in every community, while rural and smaller centres carry the highest burden.
Community | Total Households | % Households in EP | Seniors | Older Homes | Renters |
|---|---|---|---|---|---|
Calgary | 502,305 | 13.1% | 35.0% | 56.9% | 20.8% |
Edmonton | 396,400 | 13.7% | 35.1% | 60.1% | 22.8% |
Lethbridge | 40,315 | 16.6% | 41.0% | 67.4% | 21.0% |
Grande Prairie | 24,815 | 25.6% | 24.1% | 45.2% | 21.5% |
Pincher Creek | 1,275 | 18.4% | 53.3% | 58.3% | 16.7% |
Two Sides of the Solution
A two-pronged approach is needed to improve outcomes over both the short and long terms.
SHORT TERM
Low Income Bill Discount
On-bill discounts for the most vulnerable households provide immediate relief, reduce additional draw on public systems, reduce arrears, prevent disconnections, and protect credit scores.
LONG TERM
Home Energy
Retrofits
Energy efficiency upgrades reduce home energy usage, and energy bills. They also create jobs, boost GDP, improve overall housing stock, as well as decreasing emissions from the built environment.
Breaking the Cycle
These solutions work though through different mechanisms, but share core purposes. Used together, they are designed to not just temporarily alleviate, but rather definitively address the root causes of energy poverty in a way that helps people to escape the cycle.
By reducing energy unaffordability's direct and indirect effects, we can increase quality of life for individuals and reduce costs to other publicly funded systems.
Low Income Bill Discount
Home Energy Retrofits
Rebates put money back in people’s pockets immediately and help households manage rising costs.
Reduce Financial Strain
Retrofits reduce energy expenses permanently, creating long-term savings for households and the system.
Rebates work with people's existing habits—they don’t require them to change how they use energy.
Work Within People's Capacity
Retrofits reduce reliance on behaviour by making homes more efficient regardless of how energy is used.
Rebates can reach more households quickly, including those who may not be able to access other supports.
Address Critical Needs
Retrofits can level the playing field by addressing differences in housing conditions that drive higher costs and worse outcomes.
Solution Refinement & Implementation Progress
Read more about the two sides of the solution in-progress in the 1-page explainers below.
Check back regularly to see how solutions are progressing.
Learn More
Interested in learning more?
CONTACT:
Julie Bunker
Project Coordinator, Alberta’s Electricity Future
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