Heritage Gas applies to lower some commercial rates by 64%

Heritage Gas has applied to the Nova Scotia Utility and Review Board to lower its rate by 64 per cent for some of its commercial customers in hopes of making natural gas more competitive with other fuel sources. 

President Chris Smith says the company has lost 100 customers in the past few months. 

"We're also aware of the fact that certain other customers are evaluating their options and are potentially making plans to convert to propane and or oil," he said.

"We're making strong movements to allow them, to provide them, with a rate release, so they aren't forced to make a change."

15 people laid off

The company wants to lower the base energy charge from $8.69 per gigajoule to $3.10 per gigajoule for small- and medium-sized businesses. The rates would remain the same for other customers. 

The low Canadian dollar and shipping in natural gas from other parts of Canada have also contributed to making their product more expensive, Smith says.

One way the company is balancing the loss of revenue is by cutting its workforce. This week, it laid off 15 workers.

Those positions include people who designed pipeline infrastructure, construction workers and some customer service staff, Smith said.

He says the company also plans to scale back operating expenses. 

"We'll still be investing in the growth of the business but we won't be doing as much as we have had in the past," he said. 

1,200 businesses eligible

The approximately 1,200 businesses eligible for a rate reduction use between 500 to 5,000 gigajoules, five times to 50 times as much natural gas as a typical household would in a year, Smith says.  

The company estimates those customers would save between $2,700 and $27,000, depending on how much natural gas they use. 

"We think it'll stem the tide, customers won't need to consider alternative options because the pricing we'll be providing them will be comparable to. . .the competition."

The company filed its application March 2.

Smith says they would likely keep the lower rate in place for four years until a new gas storage facility is set up in 2019.