The government of British Columbia, Canada, has launched a two-phase, comprehensive review of BC Hydro intended to contain rate increases, control costs and position BC Hydro for future success.
Phase 1: The government is working with BC Hydro to identify cost savings, efficiencies, new revenue streams and other changes to keep electricity rates low and predictable over the long term, while ensuring BC Hydro has the resources to continue to provide clean, safe and reliable electricity. An advisory group consisting of staff from the Ministry of Energy, Mines and Petroleum Resources; the Ministry of Finance; and BC Hydro will perform this phase. Recommendations are expected this summer, to inform a refreshed rates plan and assist BC Hydro in preparing its next rates application to be filed with the B.C. Utilities Commission (BCUC) in February 2019.
Phase 2: Starting in late 2018, the province will establish an expert panel to provide recommendations to ensure BC Hydro is well-positioned to maximize opportunities flowing from shifts taking place in the global and regional energy sectors, technological changes and climate action. It is anticipated the panel would deliver its recommendations to the government by the summer/fall of 2019.
For context on the situation, BC Hydro rates have increased 25% since 2013 and more than 70% since 2001. BCUC rejected BC Hydro’s request for a rate freeze on March 1, 2018, instead approving an increase of 3% and noting that “even with the rate increase, BC Hydro is not able to fully recover its revenue requirements in that fiscal year.”
BC Hydro is a Crown corporation tasked with generating and purchasing reliable, affordable electricity for its customers. The company owns several existing hydro assets and is working to build the 1,100-MW Site C Clean Energy Project.