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SASKENERGY COMMODITY RATE INCREASE APPROVED

September 10, 2008

SASKENERGY COMMODITY RATE INCREASE APPROVED

The Provincial Government today approved an average 20 per cent total bill increase for SaskEnergy's customers to reflect higher natural gas commodity costs effective Oct. 1, 2008. This increase, when combined with the proposed change to SaskEnergy's delivery costs, results in a total bill impact of $19.50 per month for the average residential customer.

The Saskatchewan Rate Review Panel recommended an increased commodity rate of $8.71/Gigajoule (GJ), however the new approved rate is slightly lower at $8.51/GJ due to an updated price forecast provided by SaskEnergy.

The proposed change to delivery costs of $2/month to the Basic Monthly Charge to take effect November 1, 2008 remains under consideration by the Saskatchewan Rate Review Panel.

"We appreciate no one likes to see their utility bills increase," Crown Corporations Minister Ken Cheveldayoff said. "This increase reflects the expected open-market costs that SaskEnergy will pay for natural gas over the next year, including already-purchased gas in storage together with the anticipated costs for both this winter's and next summer's gas. These costs are reflective of the prices that have occurred in the North American natural gas market."

The Panel also recommended the Government consider mitigating some of the rate increase, particularly for low-income earners and explore how to make energy conservation programs more affordable for low-income earners.

"As we have indicated before, our government prefers measures such as broad-based tax relief that benefit all Saskatchewan residents over rebate programs," Cheveldayoff said. "As the Premier has indicated, we are considering sustainable and affordable tax relief that will help all Saskatchewan people, including low-income earners, deal with the rising cost of living."

In response to the Panel's other recommendations, the Government will be reviewing existing energy efficiency programs for low- to moderate-income earners later this fall.

The Panel also noted in its report that SaskEnergy does not profit from an increase in the natural gas commodity rate since it only collects from customers what it pays for natural gas.


For further information, please contact:

Mike Woods  
Crown Investment Corporation  
Regina  
Phone: 305-787-5889 Email: mwoods@cicorp.sk.ca