Letter: BC Hydro numbers do not add up


On April 27, 2010, the B.C. Liberals under Gordon Campbell passed legislation the stripped the B.C. Utilities Commission of its powers.

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The legislation stated that one of B.C.’s energy objectives was “to ensure the commission, under the Utilities Commission Act, continues to regulate the authority with respect to domestic rates, but not with respect to export, except as provided by this Act.”

Note that the Act only applies to domestic rates and that it is only domestic rates that have been made wholly responsible for he total debt incurred by the government’s management of the Crown corporation.

Last June, BC Hydro reported almost $6 billion in deferral and regulatory accounts.

As a residential consumer, I am quite concerned about the latest deferral of BC Hydro’s debt.

The auditor feneral has just announced the deferral of another $5.5 billion to be recovered from ratepayers over time.

This will mean households will be subsidizing both industry and exports for many years to come — both of which are charged about one-third of the cost of producing that electricity.

PowerEx, BC Hydro’s export arm, sends electricity with a blended aggregate production cost of approximately eight cents per kw/hour to the U.S. at 2.33 cents per kw/hour.

BC Hydro’s industrial rate averages about 3.5 cent per kw/hour.

It seems that in addition to having the full responsibility for paying the debt of BC Hydro, domestic households are forced to subsidize both American exports and selected industrial customers, which now includes the rate given to the Kitimat LNG export project.

If, when the price of domestic electricity is based upon a blended rate, that factors in the independent power contract rates with that produced from Hydro’s facilities, shouldn’t that same rate be charged to all of its customers?

On June 15 of last year, I wrote to Energy Minister Michelle Mungall regarding BC Hydro’s debt, asking whether her ministry would consider setting the minimum rate charge for electricity from BC Hydro, whether domestic, industrial or export, at whatever the aggregate or blended cost was to BC Hydro for that same electricity.

I have yet to receive an answer.

Abe Bourdon

© Kamloops This Week


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