Red Deer city council was urged to take more time to review its options before settling on creating a municipally controlled corporation (MCC) for its electricity utility.
FortisAlberta's Todd Dettling urged council to consider a 60-day pause to consider other options.
"It's not really clear to the general public the options that are available," Dettling told council at a Monday public hearing on a resolution to "evolve" the electric utility into an MCC.
Partnerships, joint ventures or a competitive divestiture model are options that should be considered more closely. One option would be to sell off the electrical system to a private operator, which could work out a franchise agreement with the city.
The model is used successfully in a number of Alberta communities, he said. FortisAlberta is the province's largest electric distribution provider, serving 240 communities and about 600,000 customers.
In a submission to council, Fortis says the city's MCC plan "does not contemplate the challenges of modernizing and electric utility."
Going to an MCC could prove more costly than the city estimates, with Fortis estimating double-digit increases needed over the next four years to meet revenue requirements.
Council did not debate the resolution on Monday night because of time. The public hearing was adjourned at 9 p.m. until 9:30 a.m. Tuesday.
Canadian Union of Public Employees representative Ella Henry urged the city to maintain oversight and ownership of the electrical system either by continuing to run it or through an MCC.
Council must continue to have the authority to set electricity rates to ensure it continues to operate in the public interest and is accountable, said Henry, CUPE political action co-ordinator. CUPE represents 1,200 city employees.
While divestment would provide a one-time payout it is almost impossible to reverse should council feel it is not working out, she said.
Len Kangas urged caution because the success of an MCC will depend on the competency and abilities of the board, which should be chosen carefully.
"What I'm saying is I'm in favour of it, but it's got to be handled right."
If the city was to consider selling to a private entity, that should go to a vote of Red Deer citizens first, he said.
Gord Tulk said it is time for the city to get out of the electricity business.
No municipality should be involved in a business where the private sector can do the job, he said.
"You're competing with the private sector," he said, adding there are numerous examples where the private sector does a better job of delivering quantity and quality for less cost than the public sector.
Red Deer District Chamber has taken a similar position.
Chamber CEO Scott Robinson said last week the chamber believes "full divestiture or partnering with an experienced utility operator should be thoroughly explored as more scalable, efficient, and lower-risk solutions."
Selling off the electric utility – divestiture – "offers an opportunity for a one-time capital injection that could reduce debt, reinvest in critical infrastructure, and support economic development, all without raising taxes on local businesses or residents."
An MCC may also "create unnecessary competition with established private businesses already regulated by the Alberta Utilities Commission," the chamber says.
Margaret Day urged council not to sell off the utility because customer service will inevitably suffer.
Other large corporations such as Shaw, Telus and Rogers are motivated by profit, not customer service, she added.
"Why would you do away with it?"
Councillors appeared to be struggling with whether an MCC was the best way to go.
There were a number of questions to staff and consultants about what the implications of saying yes to an MCC were and whether that locked council into a single path forward.
City acting general manager of finance Tricia Hercina said there will always be options going forward.
"At no point have we said this is a forever plan," she said. An MCC is seen as the "best next step" in modernizing the city's electric utility.
