Thank you.
Good morning, Chairman Richards, and members of the committee.
Thank you for allowing us to make a presentation today on behalf of the Federation of Alberta Gas Co-ops. We are excited to be here because we want to demonstrate for you what cooperatives are able to achieve.
Alberta is a great example because we have something that is virtually unheard of anywhere else in the world. Anywhere you live in Alberta, whether it is a farm, a town, or a cabin by the lake, a flick of a switch brings natural gas heating to your home. There are parts of our country where to get this service you have to be living in a city or be lucky enough to have a major natural gas pipeline running past your yard. Having heating fuel or propane trucked in to have heat is the norm in much of rural Canada. Rural Alberta is different. Over the past 50 years a spiderweb of low-pressure natural gas pipelines has been constructed throughout all inhabited parts of the province. Just about any Albertan has the ability to have natural gas piped directly into his or her home. Indeed, it is almost considered to be a right by Albertans.
The reason Albertans enjoy this privilege is that 50 years ago this year a group of farmers south of Calgary got together around a kitchen table and decided to build the very first gas co-op. They were tired of natural gas companies saying it was uneconomical to build a pipeline to a farmer's house. They were tired of seeing small communities die because their kids wanted to live where they could have city comforts, like easily accessible heating. Instead, they built the Meota Gas Co-op for themselves.
What they started became the gas co-op movement. Natural gas co-ops began forming across Alberta for the very same reason that prompted the farmers at Meota. Volunteers signed up customers, they got an administration running, and they started constructing pipelines. A decade later, the province got involved, and since 1973 they have been providing grants to offset the costs of installing and upgrading pipelines. They even made it law that gas co-ops and private gas companies in rural areas had a duty to provide natural gas to anyone who asked for it within a franchise area. Today, what started from a kitchen table has evolved into the world's largest rural natural gas system, with over 100,000 kilometres of pipeline—enough to circle the earth almost eight times.
The federation, as an umbrella organization overseeing Alberta's gas co-ops, now includes 53 gas co-ops, as well as 22 municipally owned gas utilities and six first nations systems. We have over 115,000 services spread from the B.C. to Saskatchewan borders, and from the Dene Tha, in far northern Alberta, right down to the American border. In fact, we even serve just south of the border at a U.S. crossing point. We estimate that between 350,000 and 400,000 Albertans young and old are kept warm by our gas co-ops.
Just as important, our gas co-ops have been a key instrument in the economic development and sustainability of rural Alberta. We have kept people in their homes, we have made it possible for people and businesses to move into rural communities. Gas co-ops have made it possible for grain dryers to operate more economically and for farms in arid areas to survive because gas powers their irrigation pumps.
Collectively, our co-ops directly provide approximately 850 jobs based in rural communities. Our offices and workshops are in the very communities that our co-ops serve. Their corporate structure is that they are locally owned by their own neighbours. These are workers who shop locally, live locally, and play locally. Their presence helps sustain Alberta's rural communities and keeps them vibrant.
Our co-ops invest $12 million to $14 million in construction in Alberta's pipeline infrastructure every single year. Our gas co-ops alone, not including the municipalities and first nations, possess over $243 million in assets. In 2010 these co-ops sold over $112 million in gas and another $32 million in secondary services such as furnace installations. Our utilities also own a gas brokerage firm called Gas Alberta Inc., which buys and sells gas for our member utilities. Each year they sell 25 million gigajoules of natural gas to Albertans.
Some of our co-ops have taken the original goal of the gas co-ops to help rural communities one step further, by expanding into providing Internet. Their wireless broadband Internet company is following the goal that rural residents deserve similar services as urban residents and are bringing high-speed Internet to regions where it was either not available or not reliable.
These are progressive co-ops. We're looking forward to the future, with projects such as taking 50 years of infrastructure history and moving it on to a web-based geographic information system database.
In 2011, we were one of the first in Canada to gain approval to install wireless meter reading devices. After just over a year, we are now able to read approximately 40,000 gas meters from remote readers. We are collecting these readings by driving, by flying over, or through wireless Internet. We have eliminated thousands of kilometres of driving on the road every month, thereby reducing pollution, time, accidents, and helping to prevent the spread of agricultural diseases.
The federation remains the only gas utility in the country to have Measurement Canada accreditation to inspect and re-verify RMO station meters in the field. Every other utility must send its station meters to a meter shop to have them re-verified.
What the gas co-ops have been able to achieve is nothing short of remarkable. We have helped to build a better Alberta and created a system that people elsewhere envy.
To be fair, we did it with help from the Alberta government. In the 1970s, when most of our co-ops were formed, we needed that help to get us started. Its rural gas program grant, which today is worth $3 million per year, has been instrumental in offsetting the cost of installing new pipeline and upgrading old systems to handle larger populations.
We believe our gas co-op system can be emulated in other parts of Canada, giving more Canadians the same privileges that rural Albertans enjoy, while reducing their energy costs and giving them a cleaner alternative than some of the options they currently must use. We believe the cooperative model is the best option to help build gas systems, as there is little economic benefit for private companies to take on the expense of servicing rural customers.
But just as the gas co-ops in Alberta required help, so too would other areas of the country. We believe the federal government can play a powerful role in the formation of not just gas of co-ops but any kind of cooperative.
The federal government needs to recognize that the cooperative sector is a sustainable and viable economic model with the potential for economic growth, diversification, and community sustainability. The federal government should take a more active role in the formation and development of cooperatives.
Staff at the regional economic diversification offices should be trained on the nature of the cooperative sector, including their economic potential. This training should also include how to form a cooperative. This knowledge can then be used to help establish cooperatives across Canada, or connect fledgling co-ops to existing cooperatives that provide a similar service.
A fund should be started to help initiate co-ops, potentially through the regional economic diversification offices. Seed funding is often difficult to gather, but once a co-op has begun then its economic potential will be a benefit to its community. These steps would allow the federal government to help the Canadian cooperative sector grow.
As you can see from the example of Alberta's gas co-ops, allowing co-ops to thrive can create achievements that can't be accomplished any other way. With the assistance of the federal government, we truly believe co-ops can help to build a better and stronger Canada.
Thank you.