BC Hydro rates will increase about 15 per cent during the next two years.
Energy and Mines Minister Bill Bennett said a new 10-year plan will keep electricity rates predictable and as low as possible, while BC Hydro invests in new infrastructure for aging assets to support the British Columbia’s growing population and economy.
Cariboo-Chilcotin MLA Donna Barnett notes the B.C. Liberal government will set rate increases for the initial two years of the 10-year plan, at nine per cent in 2014 and six per cent in 2015.
The following three years will increase within maximum caps of four per cent for 2016-18, she says, adding it may be lower.
“If we get all kinds of customers, then we’ll be in great shape.”
The Crown corporation is cutting capital costs by $2.4 billion, Barnett explains, and prioritizing the infrastructure and investments necessary to meet the electrical needs of current and future customers.
“Nobody likes increased hydro rates and nobody likes to deliver this message, believe you me. This came out from the minister. In order to continue to improve infrastructure so lights stay on, you have to do major capital improvements.”
Barnett notes rebuilding the aging infrastructure is also necessary for building more resource revenues that fuel the economy and, therefore, key services, such as health care and education.
“Hopefully with the new resources industries to come on stream, you will see a huge turnaround of hydro. We will need all we can produce for new industries.”
NDP energy critic John Horgan says Bennett avoided dealing with the impact of private power purchases on BC Hydro’s rate increases.
“The [B.C.] Liberal government has locked us into contracts with private power producers that force us to buy very expensive power even when we don’t need it. Then we sell it back to the open market at a huge loss.”
However, last fall BC Hydro began cancelling up to 10 electricity purchase contracts with independent power producers and deferring delivery dates on nine others to reduce the utility’s cost.
Barnett adds there will be consumer impacts, but they won’t be massive.
“Everybody is going to be upset. I’m upset. I’m a taxpayer. I’m a person who turns my lights on and off, and I know the detriment it’s going to be to the average household … it will be about $8 a month, depending on their [level of] power usage.”
The BC Chamber of Commerce (BCCC) says it supports investments in this critical area.
“With B.C.’s aging infrastructure, we recognize BC Hydro rate increases can’t be avoided,” says BCCC president and CEO John Winter.
“The challenge is to minimize negative impacts to businesses and residents – and we feel this plan strives hard to achieve that.”
When the NDP publicized a leaked draft document last fall, it indicated rates would jump more than 26 per cent within two years, Barnett says, adding it’s not 15 per cent over two years, as it pans out.
“These are the facts. Leaked documents come from who knows where. Things fall on the floor sometimes that people want to fall on the floor, and they are not always facts.”