Red Deer County has worked out a deal with ATCO to slash the cost of natural gas delivery for Gasoline Alley and Springbrook.
The agreement is seen by the county as another way to boost economic development in growth areas.
County council unanimously agreed to enter into a Natural Gas Distribution System Franchise Agreement, which dramatically reduces the cost of hooking up for businesses and residences.
One Gasoline Alley business was quoted a hook-up fee of $42,0000. That will be reduced to less than $1,000 under a franchise agreement.
The agreement will also mean significant savings for developers, such as Calgary’s Lamont Land Inc., which is developing 86 lots near Laura Avenue and McKenzie Road in Gasoline Alley. It is the first phase of an anticipated six-phase, 700-lot project called Liberty Landing.
Work has already begun on the site and construction on the first homes is expected to begin this fall.
Hook-up fees of about $2,000 per lot are expected to be reduced to under $100, said Dave Dittrick, county director of planning and development services.
For ATCO, the deal provides access to county roads, rights of way and other properties to build gas infrastructure.
The economic development potential of the move was not lost on councillors.
“I think it’s important we set our developers up for success moving forward,” said Coun. Christine Moore.
Mayor Jim Wood said that as the situation stood those developing in the Gasoline Alley and Springbrook areas were at a disadvantage. A franchise agreement makes them competitive.
“I think that is really important.”
Coun. Connie Huelsman was pleased the franchise agreement does not have any effect on the existing eight gas co-ops that serve the county.
Dittrick said there is potential to look at similar agreements with other utilities, such as electricity providers.