Cold Lake, AB – The City of Cold Lake will increase its electrical franchise fee from 4.25 per cent to 5.75 per cent in order to recoup the cost of switching to LED street lights.

The franchise fee is charged and collected by ATCO for the exclusive right to provide electrical distribution in the city. This fee is then passed on to the municipality. The increase will take effect at the end of the current franchise agreement’s term, on January 1, 2023, and is expected to cost the average household approximately $2 per month.

“We are upgrading our infrastructure so that we can go green, use less electricity, and in the long run, save money,” Mayor Craig Copeland said. “ATCO will take over the maintenance and replacement of the new light system, so we (the City) are saving money in capital costs, but our annual operational costs will be a little higher. To cover those costs, our council decided that the franchise fee was the most appropriate and fair means of raising the needed funds. Franchise fees in municipalities vary wildly and we have historically been, and will remain, on the low side”

The decision to make the upgrade was made earlier this year with the knowledge that the funding decision would come when the electrical franchise agreement extension came due. The alternative tax increase would have resulted in a 0.75% property tax increase.

“We know that, especially these days, no one wants to hear about their bills going up, but we do need to make infrastructure upgrades that will make us more efficient in the future,” Copeland said. “Ultimately, the franchise fee is a very small portion of an electrical bill and council felt that it was the way of raising revenue that would have the smallest impact on households in our community, while having the pay off of better, more efficient infrastructure in our city.”

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