News

Propane prices skyrocket in Sun Peaks

Resort Gas Ltd considering natural gas as an alternative to propane
 | March 23, 2022
Photo: The increase is greatly impacting utility costs for residents. Photo Kyle James.

Last week, Sun Peaks Mountain Resort Municipality (SPMRM) announced the gas commodity rate is increasing 71 per cent, with billing being backdated to Jan. 1, 2022.

SPMRM operates the distribution of propane and collects fees. However, gas and propane in Sun Peaks is controlled by Resort Gas Ltd., a utility company owned by Sun Peaks Resort LLP.

Resort Gas Ltd. is regulated by the B.C. Utilities Commission (BCUC) and is required to submit quarterly reports and regular rate reviews. In fall 2021, BCUC requested a rate review from Resort Gas Ltd. due to the surge in the wholesale price of propane and an accumulating loss in its Gas Cost Recovery Account (GCRA).

The GCRA is intended to level pricing out since the cost of propane can fluctuate. Businesses aren’t permitted by BCUC to operate with losses outside of the approved range.

Resort Gas Ltd. proposed a rate increase to help balance out the GCRA in December 2021 and the rate was approved by BCUC on March 14, with order to backdate to the beginning of the year with these prices. This increase was not mentioned to customers until it was approved.

In a council meeting on March 15, director of finance Cheryl Taylor-Gale said staff continue to monitor the market price for propane on a daily basis, and will be submitting information to BCUC more frequently to ensure prices are only high while they have to be.

The 71 per cent increase is greatly impacting utility costs for residents. Home owner Scott Mallinson said even though he is away a lot for work, the costs of keeping his house heated will rack up expensive monthly bills.

“I have a few friends living on Fairways Dr. and we are all shocked by these extremely high prices,” Mallinson said. “My utility bills will be well over $1,000 per month in winter with this increase.”

Mallinson is one of the many community members calling for Sun Peaks to be switched from propane to natural gas. Resort Gas Ltd. said in a statement to SPIN that it has been exploring options for natural gas for a while.

“To-date, the capital cost of such a project has been cost prohibitive, in the multi-millions of dollars, and up to the community to partially, if not almost entirely, fund through service fees,” read the statement. “Recently, a new rate concept for a small community in B.C. has been approved based on a new project pricing model.”

A natural gas supply would need to be connected into an existing pipeline, the closest line being in Rayleigh. With propane becoming less cost effective, Resort Gas Ltd. said it continues to look at whether this is a suitable option for the community.

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