The City of Lacombe has discovered a new way to put coin in its coffers.
On Nov. 1, the City created a new entity, Eco Energy, to retail electricity to consumers in Lacombe and beyond. Initially, the operation was small so that the City could get a feel for it and work out any kinks, but now they are moving to actively seek out new customers.
“It’s a huge advantage,” said Mayor Steve Christie. “It almost seemed to be too good to be true at the start.”
With government grants becoming harder and harder to come by, the City is always looking for alternative revenue streams, said Christie. He added that continuing to raise taxes whenever the City needs increased funding isn’t realistic either.
“It’s not a get rich quick scheme by any means. But it’s definitely a solid stream of revenue.”
Christie added that Eco Energy is also a very low-risk revenue stream. He said that the only costs to the City would come into effect if customers did not pay their bills, something that is unlikely to happen often as no one wants to have their power disconnected.
Guy Lapointe, community and economic development manager for the City, said that Eco Energy is a win-win for Lacombe. He said that not only can it offer competitive utility rates, the money from those profits is funneled back into the Eco Lacombe Fund which will be earmarked for recreational and cultural capital projects.
“You will see community projects come out of this,” said Lapointe.
He added that this fund will also free up monies elsewhere that the City can use for other things.
Lapointe said that the funds generated from Eco Energy will go back into the community and be earmarked for capital projects related to recreation.
Christie said that the revenues from Eco Energy should also help to counter the imbalance between what amenities and capital projects the City needs to bring to Lacombe and what the City can afford. “Every little bit helps,” said Christie. He added that, in the past, capital projects like the Lacombe Memorial Centre have been funded largely through fundraising and donations from the community. While Lacombians have always been more than willing to jump on an initiative that will benefit the community, through Eco Energy they can still do that while paying for a utility they need anyway.
Eco Energy is partnered with Utilitynet, which acts as the supplier for the electricity while Eco Energy is solely the retailer.
Lapointe said that Eco Energy’s sole responsibilities are promotion to get people signed up for the program and making sure they pay their bills.
Currently, Eco Energy has about 45 households signed up, but there is certainly room to grow. Lapointe said if Eco Energy could sign 1,500 households, or the equivalent of such, he projected revenue streams of about $200,000 per year.
“There is significant dollars to be made,” said Lapointe.
There is also opportunity for Eco Energy to sell electricity to consumers outside of Lacombe as well. Christie said one of the first larger business that signed up for Eco Energy was Action Group, which has a presence in Lacombe, Red Deer and beyond.
Steven Schwartz, accountant for Action Group, said that he decided to get involved with Eco Energy because they were offering a fixed rate that the organization was looking for. He said Action Group was looking to stabilize its cash flow and that he learned about Eco Energy when comparing rates. “Their rate was comparable, if not better,” said Schwartz. “And it was local, that was kind of the tipping point.”
He added it was important for Action Group to support that local initiative because it wanted that money to go towards projects that both clients and staff will benefit from in the future.