Saskatchewan farmers can blame hurricanes Katrina and Rita for two direct hits this fall.
Disruption caused by the two storms pushed the North American natural gas market higher, leading to increased fertilizer prices.
Farmers are also going to pay more to heat their homes.
Last week, SaskEnergy asked the province’s rate review panel for a 41 percent increase. The crown utility had already asked the panel for a 27 percent increase. It amended its request because of significantly higher market prices for natural gas.
SaskEnergy based its request on a commodity rate of $10.88 per gigajoule, effective Nov. 1. The current rate is $6.97.
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On average, the hike would add another $50 per month to farms’ household heating bills. Urban homeowners would see an average $39 monthly hike.
Terry Hildebrandt, president of the Agricultural Producers Association of Saskatchewan, said this is another cost that farmers can’t pass on.
“The long and the short of an energy increase is devastating like everything else,” he said in an interview.
Farmers will pay more to dry grain and heat shops. As well, they will face higher bills from suppliers who can pass costs along. Hildebrandt said it will be difficult enough for farmers to pay the extra costs for their own natural gas consumption.
He said he expects the province will have to step in and provide some assistance. He speculated the rate review panel may not approve the entire 41 percent increase.
Pat Atkinson, the cabinet minister responsible for the crown management board, said the government will stick by its commitment to provide citizens with the lowest cost bundle of basic utility rates in Canada.
“We are working on additional programs in both the conservation and rate assistance areas,” she said in a News release
news. “We will announce these programs after we have received recommendations from the Saskatchewan rate review panel.”
The panel will make its recommendations to the government on Oct. 24.
