The deal is done. Direct Energy has been sold to NRG Energy Inc, an American company, headquartered in Ne
w Jersey. The finalization of the purchase was announced on January 5, in a very low-key notice posted on the NRG Energy website. With such a quiet announcement, we wonder if most of Direct’s customers have been left in the dark about the deal. Why the secrecy?
What does this mean for you?
If you are a Regulated Rate Option (RRO) customer buying electricity or natural gas at AUC government regulated retail prices, your account has also been sold as part of this deal.
Why does this matter? In time, more and more Alberta jobs will be leaving the province. We asked the government why they approved the sale of the Alberta government-regulated utility to an American company. Why didn’t they stop it?
Direct Energy has a long history of outsourcing. Its Customer Care call centre jobs were moved first from Alberta to the Philippines, then to Guatemala. Its billing processing jobs were relocated to Texas, and its key technical system’s people and services were outsourced to HCL of India. Additionally, Direct Energy sold off their Alberta natural gas holdings to a joint partnership including Mercuria (HQ Geneva), Can-China Global Resource Fund (in part, funded by China Exim Bank), and MIE Holdings Corporation (HQ Hong Kong).
Now the profits on the retail sales of the energy to customers who are on the government’s regulated rates will end up being consolidated on the balance sheet of NRG. Hundreds of millions of dollars in investments and jobs have been shipped out of the province by our big utilities.
It is time for the Alberta government to explore how it can stop the erosion of the ownership of Alberta’s utility businesses. Direct is not the only utility company guilty of selling off assets and shipping jobs out of the province. ENMAX and ATCO also have laid-off workers and sold off sections of their utility business. Heartland Generation Ltd., an affiliate of American investment firm Energy Capital Partners purchased nine of ATCO’s Canadian Utilities Ltd. generation plants which were located in Alberta. The City of Calgary’s District Energy facility will be sold off to Liberty Utilities in 2021, and, as most people know, Alberta’s transmission lines are owned by Berkshire Hathaway Energy.
As we head into 2021, it is time for our political leaders to put their polarized beliefs on the back burner and for both leaders to join together in a bipartisan mindset focused on protecting Albertan jobs. We need both leaders to work together for the benefit of Albertans, and having our province’s major government-regulated rate utility retailer run by an American company does not achieve this goal. In fact, by doing nothing, our politicians are providing a direct benefit to an American corporation, not Albertans. We challenge both political leaders to take a serious look at Alberta’s problems and work together to protect jobs.
Dear Premier Kenney and Ms. Notley, promote local businesses and don’t fear the global utilities’ corporate muscle. Jobs and businesses do not have to be sold off to American consortiums. It is time to restructure the Regulated Rate Option (RRO) policies and help educate consumers about their choices. Promote “buy local.”
A simple solution might be to make it clear to the big utilities that if they are going to profit on the sale of energy to consumers on the government’s regulated rate, then at a minimum, the utility must operate in the province and bring the jobs that they exported back.
A Local Choice
As the COVID-19 pandemic continues to cause business closures across the province, a push for Albertans to shop locally for their goods and services has grown and has never been more critical.
Choosing a local independent business for your shopping, dining, and other needs have many benefits, including strengthening your local economies, creating jobs and opportunities, giving back to your community, and more.
When you hear the words “shop local,” what comes to mind? We would guess that the majority of our readers would immediately think about farmers’ markets, independent restaurants, or even boutique clothing stores. Did anyone think “energy provider”?
There isn’t anything inherently exciting about purchasing electricity and/or natural gas. Nevertheless, you still have a choice of who you purchase it from. And within those choices are locally-owned and operated energy retailers, as well as others that are not.
The push for shopping locally should not end after the holiday season. As we enter 2021, local businesses will need your help more than ever, but this year Alberta’s market will also see the introduction of another American-run energy retailer.
Alberta’s competitive market can support well-paying jobs and offer customers lower energy prices.
Are there options for consumers? Absolutely! Consumers have a choice: in fact, there are over 23 locally-owned and operated utility providers like NewGen Energy. Both NewGen’s variable and fixed retail electricity prices are below the government-sponsored Regulated Rate Option (RRO).
If you are a homeowner and currently enrolled on the Regulated Rate Option (RRO) provided by Direct Energy, you will pay 7.696 cents/kWh for your electricity during January. NewGen’s floating variable rate is sitting at 5.4 ¢/kWh and the 2021 guaranteed electricity rate is 6.81 cents/kWh.
Compare and save. As outlined in the chart below, ENMAX is charging 7.981 ¢/kWh in January, and regulated rate customers of EPCOR will see their retail prices jump from 6.8 ¢/kWh in December 2020 to 8.117 ¢/kWh this month. Additionally, in the farming community, North Parkland Power REA for example pushed their electricity rate up to 8.6 ¢/kWh. Prices charged by all regulated providers in Alberta have increased. Now is a great time to find a small local energy provider that is offering lower rates.
* Calculated based on rate of $0.45500/Day according to https://www.directenergyregulatedservices.com/ as of January 6, 2021.
** Calculated based on rate of $0.2201/Day according to https://www.enmax.com/home/rro/regulated-rates as of January 6, 2021.
*** Calculated based on rate of $0.202/Day according to https://www.epcor.com/products-services/power/rates-tariffs-fees/Pages/regulated-residential-power-rates.aspx as of January 6, 2021.
Why pay more for the energy you consume from a company that has outsourced jobs when you can support a local company that employs Albertans?
The bottom line is simple: our prices are more than competitive, and you will be surprised at the perks you will benefit from by switching over to a local and private energy retailer.
The responsibility of protecting Alberta jobs cannot be put squarely on the shoulders of our political leaders. Consumers likewise need to be proud of supporting local companies.