Fewer water main breaks in Moose Jaw and Regina and less customer demand for water are two reasons why the Buffalo Pound Water Treatment Corporation (BPWTC) had reduced operating revenues this year.
The corporation expected water revenues this year to be $14,470,000 but now estimates that figure will be roughly $273,000 less than expected, according to its semi-annual report.
Meanwhile, the business had thought expenses would be $14,430,000 but now estimates that figure will likely be $870,000 more than expected. This increase is due to the disposal of sludge from its lagoons into the Moose Jaw Landfill.
Therefore, the corporation expects the operating reserve deficit to be $1.1 million this year. This account — forecast to be $1.1 million by year’s end instead of the targeted $2 million — is a cushion in years when water sales are below forecasts or unanticipated costs exceed budget.
Ryan Johnson, president/CEO of the BPWTC, told city council during its recent executive committee meeting that water sales this year were 1.9 per cent below target. However, the organization has reserves to cover this shortfall and neither Regina nor Moose Jaw will be affected.
The company completed a two-year budget last year and set its water rates for 2024 and 2025, he continued.
This year, water rates are $388 per megalitre (ML), while next year, they will increase to $400/ML, and then in 2025, they will jump to $440/ML.
“The increases help us service the $55 million in debt we took out last year for our plant renewal project,” said Johnson.
Also, the capital water rates this year are $287.50/ML, while next year they will rise to $361.50/ML, and in 2025, they will jump to $365/ML.
The operating budgets for 2024 and 2025 are similar to this year’s budget, although they do include some inflationary adjustments for utilities, chemicals and fuel, his report said.
Meanwhile, the electrical rates are based on the corporation moving to 100-per-cent renewal power this year, with the water treatment plant generating roughly 10 per cent of power on-site from solar and the rest coming from SaskPower.
The electrical rates in 2023 were roughly 16 cents per kilowatt hour (KWh), while they will jump to 16.9 cents/KWh next year and then increase to roughly 18 cents/KWh in 2025, the document added.
The total overall cost for water next year will be 76.15 cents per cubic metre and 80.5 cents per cubic metre in 2025, said Johnson. After the plant renewal project is completed, the corporation will only increase costs using the consumer price index (CPI).
The plant renewal project was progressing well by Aug. 31, while construction crews had completed 40 per cent of it after 14 months of work, he continued. There are 14 sub-contracting companies on site and 180 total people working; they have contributed roughly 410,000 man-hours out of an expected one million man-hours of work.
The project is three months behind schedule, but installation of all critical items is on track, Johnson stated. While all the additional sub-contractors have disrupted everyday operations, the corporation has had good communications with the main contractor to avoid conflicts when possible.
Overall, the organization has spent $142 million out of a budgeted $325 million, Johnson added.
Coun. Jamey Logan noted that the BPWTC’s income was down this year because of the decreased water use, pointing out it was a “pretty dry year.” He wondered if there was a specific reason why consumption had dropped and whether the corporation was worried that this was a trend.
Johnson replied that there have been fewer water main breaks in Moose Jaw and Regina this year, which affects how much water the company sells. Also, customer demand for water goes down whenever there is a rate increase. Yet, the organization usually sees a rebound of 90 per cent afterward.
The next executive committee meeting is Monday, Dec. 18.
In response to some providers blocking access to Canadian news on their platforms, our website, MooseJawToday.com will continue to be your source for hyper-local Moose Jaw news. Bookmark MooseJawToday.com and sign up for our free online newsletter to read the latest local developments.
