Management’s Discussions and Analysis
and sales contracts showed only minor movement from March 31 levels. Although the purchase contracts experienced increases in both average deal prices and average market prices, the resulting spread had only a slight unfavourable impact relative to March 31. Overall, these modest changes did not result in a fair value adjustment at December 31, 2025. Revenue Delivery revenue, transportation and storage revenue, and customer capital contributions, as reported in the condensed consolidated financial statements, were as follows:
Three months ended December 31,
Nine months ended December 31,
(millions)
2025
2024
Change
2025
2024
Change
Delivery revenue
$
100
$
96 64 12
$
4 2
$
208 $
205 187
$
3 9
Transportation and storage revenue Customer capital contributions
66 10
196
(2)
46
27
19 31
Revenue
$
176 $
172
$
4
$
450 $
419
$
Delivery Revenue SaskEnergy provides reliable energy and competitive rates to customers, as they value low delivery charges. Natural gas delivery rates are designed to recoup all distribution facility and operating costs necessary for delivery of natural gas to customers throughout the year and earn a return for its shareholders. Natural gas storage and transportation costs — as well as ongoing investments related to safety, system integrity and growing infrastructure — are factored into delivery rates. Other considerations impacting natural gas delivery services include regulatory code compliance and industry best practices regarding safety. To minimize the financial impacts of these on delivery service customers, the Corporation strives to make the most effective use of resources and technology, and to collaborate with other Crown corporations and executive government. SaskEnergy continues to focus on items within the Corporation’s control to embed efficiency into processes, such as identifying opportunities for standardization, simplification, and the elimination of waste from processes. SaskEnergy will continue to strive to provide customers with access to low-cost energy sources compared to alternatives and delivery charges that are among the lowest in Canada. Delivery revenue is primarily driven by the number of customers and the amount of natural gas they consume. Weather is the most significant external factor affecting delivery revenue, as residential and commercial customers consume natural gas primarily as heating fuel. Delivery revenue of $208 million through the nine months ended December 31, 2025, was $3 million higher than the same period in the prior year. The weather was approximately 1 per cent colder year over year, shifting from warmer conditions earlier in the fiscal year to notably colder temperatures in December. December was 12 per cent colder than the prior year, contributing to slightly higher customer consumption. In addition, the Corporation served a larger customer base compared to 2024, further supporting the increase in delivery revenue. Transportation and Storage Revenue The Corporation generates transportation revenue by receiving gas from customers at various receipt points in Saskatchewan and Alberta and delivering natural gas to customers at various delivery points in the province. The transportation toll structure consists of a receipt service charge, which customers pay when they put gas onto the natural gas transportation system, and a delivery service charge that customers pay when they take delivery from the natural gas transportation system. For receipt and delivery services, the Corporation offers both firm and interruptible transportation contracts. Under a firm service contract, the customer has a right to deliver or receive a specified quantity of gas on each day of the contract. With a firm contract, customers pay for the amount of capacity they have contracted for, whether they use it or not. Under an interruptible contract, customers may deliver or receive gas only when there is available capacity on the system and only pay receipt and delivery tolls when they deliver or receive gas. Integral to the Corporation’s transmission system are several strategically located natural gas storage sites, which have the capacity to provide operational flexibility along with a reliable and competitive natural gas storage service. Transportation and storage revenues of $196 million, for the nine months ended December 31, 2025, are $9 million higher than the same period in 2024. An average rate increase of just over three per cent for transportation and storage services was implemented effective April 1, 2025, to address expansion of the transmission system and meet growing demand for natural gas services in Saskatchewan.
7
Made with FlippingBook Ebook Creator