Agreement allows for user-pay natural gas system

NANAIMO – The city signed a new operating agreement with Fortis B.C. that could eventually allow it to collect a three-per cent fee.

Nanaimo’s natural gas customers could soon foot the bill for the utility’s infrastructure costs within the municipality.

The City of Nanaimo has signed a new operating agreement with Fortis B.C. that will allow it to collect a three-per cent fee on utility bills if the province approves changes with the Vancouver Island Natural Gas Pipeline Act.

Until now, the act, passed to help pay for a natural gas pipeline to the Island, prevented municipalities from collecting a franchise fee, which is used to cover the costs of natural gas infrastructure. That changed this year when the province approved a B.C. Utilities Commission recommendation to unite three Fortis energy utilities and create common rate structure, according to the province.

If changes to legislation are approved, gas bills will go down a net four per cent in 2015 and Nanaimo will collect an estimated $540,000 in revenue. It will be up to council how those dollars are spent, said Stephen Ricketts, the city’s manager of construction, who anticipates this will create a  user-pay system. Until now, taxpayers have covered natural gas utility costs, like relocation and permits.