REAs merger hailed as a ‘good victory’

Members of Central Alberta Rural Electrification Association Ltd. have voted in favour of a merger with South Alta Rural Electrification Association Ltd.

Members of Central Alberta Rural Electrification Association Ltd. have voted in favour of a merger with South Alta Rural Electrification Association Ltd.

Approximately 300 CAREA members participated in a special meeting in Innisfail on Wednesday and voted 94 per cent in favour of the merger, said CAREA chairman Jim Towle. The next day, a similar gathering of SAREA members in Lethbridge drew about 200 people, with 88 per cent giving their support.

“I think it’s a good victory for rural Alberta,” said Towle, praising the province’s member-owned rural electrification associations (REAs) as an important alternative to for-profit power distributors like FotisAlberta and ATCO Electric.

CAREA and SAREA’s amalgamation, which is scheduled to take effect on Jan. 1, will result in the creation of the largest member-owned utility in Canada.

To operate as EQUS REA, it will serve more than 11,000 member-customers in 28 counties and cover an area from the County of Barrhead to the United States border.

CAREA currently has more than 8,300 members in 16 counties, including Red Deer County, Lacombe County, Ponoka County, Mountainview County, Clearwater County and Kneehill County. It employs about 55, with its main office in Innisfail.

Towle, who operates a dairy farm east of Innisfail, said EQUS will benefit from greater resources, more buying power and a broader geographic area that will reduce the impact of localized problems like weather-induced power outages. It will also have a stronger voice with which to lobby government, he added.

Members will receive the same level of service — or higher — that they do now from CAREA or SAREA, he said.

Towle said merger discussions took place over a seven-month period. FotisAlberta campaigned against the change, he said, using flyers, visiting REA members and advertisements.

REAs represent an important alternative to for-profit distributors in rural Alberta, said Towle. This includes price competition, with CAREA calculating that it saved its members $4.2 million last year.

“REAs set a benchmark of what it really costs for power to be delivered in rural Alberta.”

Jennifer MacGowan, FortisAlberta’s director of corporate communications, said her company wanted to ensure REA members understood the merger proposal and were aware of their options. One of those options was for FortisAlberta to operate the systems — something it’s already doing for many other REAs.

“We operate them at cost,” she said, adding that the result is actually lower distribution costs for customers.

A single large operator like FortisAlberta can bring benefits related to reliability, safety and efficiency, said MacGowan, explaining that this was the message the company was trying to get out.

She noted that only about 4.5 per cent of the REAs’ members turned out for the votes.

Rural electrification association co-operatives were created decades ago as a way to bring power to rural residents. Many have since amalgamated, with CAREA resulting from the joining of 14 REAs between 1992 and 2005.

It supplies electricity to farms and homes, as well as industrial and commercial facilities, in the rural areas it covers.

Towle thinks EQUS could grow even more.

“Our doors are open to other REAs to go into negotiations.”

Towle said Innisfail will serve as EQUS’s main office. Administrative details, including the appointment of a new chair and vice-chair, will be addressed during the next month, he added.

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