The City of Calgary has officially filed a notice of application with the Alberta Utilities Commission (AUC) to amend its natural gas franchise fee agreement with ATCO Gas and Pipelines Ltd., triggering a public consultation period running from August 7 through August 25, 2026.
The proposed amendment updates the franchise fee rate to align with Calgary City Council’s 2027 revenue targets while extending the current fixed-reference-price calculation methodology for an additional year at the request of ATCO Gas.
Under the municipal franchise agreement, ATCO Gas holds the right to deliver natural gas distribution services within Calgary. The company collects the franchise fee directly from customers and remits it to the municipal government in lieu of property taxes. Revenue generated from these utility bill fees supports the city’s operating budget and core public services, helping to keep property tax rates lower.
What the Rate Change Means for Residents
In May 2026, Council directed municipal administration to collect $98.2 million in revenue from the natural gas franchise fee in 2027, an increase from the $71.6 million target set for 2026.
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Current Rate Structure: Franchise fees are calculated using a fixed reference price of $3.15 per gigajoule (GJ) of natural gas consumed.
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Proposed Rate Structure: Effective January 1, 2027, the fixed reference rate will increase to $5.67 per GJ.
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Household Impact: For the average residential customer, the monthly fee is estimated to reach approximately $10.90 per month in 2027—representing an increase of about $2.45 per month.
Next Steps and Public Consultation
Public feedback collected during the notice period (August 7–25) will be incorporated into the formal application submitted to the provincial regulator. Following the consultation window, ATCO Gas will submit the final agreement and proposed rate structure to the AUC on behalf of The City for formal approval by September 21, 2026.
Calgarians can review full project details and submit feedback directly on the City of Calgary Franchise Fee Update Page.