Maritime Electric seeking 2.4 per cent rate increase to cover Hurricane Fiona recovery

The Maritime Electric headquarters in Charlottetown. (Jack Morse/CTV News Atlantic)

Maritime Electric is seeking a 2.4 per rate increase for Prince Edward Island customers to cover the recovery costs of Hurricane Fiona.

The P.E.I. Regulatory and Appeals Commission said the energy utility, which serves more than 87,000 customers on the Island, applied for the rate increase in November 2023. The public hearing has been scheduled for March 3.

“Maritime Electric submits that its actual operating and capital costs to complete the Fiona restoration was $37 million,” the Commission said in a written notice. “Maritime Electric is seeking approval to recover these additional costs from ratepayers beginning March 1, 2024.

“As this date has passed, if approved, the Commission will determine the appropriate effective date, if any, as part of its decision on this matter.”

The Commission said the Fiona-related costs, if approved, will result in an incremental annual cost increase of roughly 2.4 per cent for customers, although the actual rate will vary depending on energy consumption and demand.

Following the hearing, the Commission will receive comments from the public until March 17.

The Fiona-related rate increase is separate from Maritime Electric’s recent request to raise residential rates by 7.4 per cent from March 1, 2026 to Feb. 28, 2027. The proposed charge for all customers would increase from $0.00475 per kilowatt-hour to $0.01949 per kilowatt-hour.

Maritime Electric said it was making that request because energy costs were more than $31 million higher than initially expected.

Last December, the Commission approved a $16-million “equity injection” for Maritime Electric to stabilize its finances following the Fiona storm.

“In support of its request for approval of the equity injection, (Maritime Electric) submits that the scale of infrastructure restoration following Fiona significantly increased capital requirements in 2023-2025, resulting in a temporary deviation from its capital structure,” the written decision from the commission reads. “In other words, the costs (Maritime Electric) incurred in those years required a significant capital spend.

“(Maritime Electric) states that proposed equity injection is necessary to restore financial stability, support ongoing capital investment, and maintain the utility’s debt-to-equity ratios within acceptable thresholds.”

Fiona, which landed on P.E.I. on Sept. 23, 2022, knocked out power for roughly 83,200 customers, according to Maritime Electric. Restoration efforts continued until Oct. 14, 2022.

Total restoration costs were roughly $34.6 million.

“This was the largest storm response in Maritime Electric’s history utilizing 205 line crews, 59 vegetation management crews and other supporting resources such as Canadian Armed Forces personnel, damage assessors, field supervisors, and traffic control personnel at the height of the restoration effort,” a post-mortem report from early 2023 reads. “The Company was well prepared and implemented best practices learned from previous weather events including post-tropical storm Dorian in 2019.”

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