Economic downturn offers no relief for residential ratepayers; provincial budget forcasts additional residential rate increases,

Posted February 17th, 2009
in
BC CITIZENS FOR PUBLIC POWER 
NEWS RELEASE
For immediate release                                                      
February 17, 2009

 
VICTORIA – An analysis of the British Columbia budget, released Tuesday in Victoria, forecasts increased revenues for BC Hydro, larger payments from the utility to the public purse, and an overall decrease in electricity consumption. All of this adds up to further increases in electricity rates—particularly to residential customers, according to BC Citizens for Public Power, a provincial non-profit organization. 

The budget’s Revenue By Source Table 1.3 forecasts an increase in revenue for BC Hydro—an estimated $185 million over the next several years ($95 million projected for fiscal year 2009/2010; $41 million in 2010/2011; and $49 million for 2011/2012) [Page 10, Budget and Fiscal Plan]. 

Moreover, “the province has asked BC Hydro to contribute to the cross-government budget management exercise by increasing its net income to the Province.” [Page. 25, Crown Agency Service Plans] 

“With BC Hydro’s concentration on aggressive conservation targets—measured by a projected decrease in load—the only way for our Crown utility to realize its revenue objectives would be through significant rate increases to customers,” says Melissa Davis, executive director with BC Citizens for Public Power. 

Last year, BC Hydro applied and implemented a rate increase of 6.56% on April 1st, followed by a two-tiered rate structure to residential customers effective October 1st. The BC Utilities Commission has yet to approve these rate increases, although a ruling is expected early in 2009. An additional 21% increase in rates is being proposed over the next three years (7.5% proposed for 2010; 6.56% in 2011; 6.75% in 2012). [Pg. 35, Crown Corporations Service Plans] 

“The impact will be most severely felt by British Columbians living on low and fixed incomes—working people struggling to support their families, as well as people on income assistance, seniors, people with disabilities, and the unemployed,” Davis said.  “Northern BC residents will also pay a serious price,” added Davis, “where cold winter climates will add up to soaring electrical heating costs.” 

Budget documents attribute the increase in BC Hydro rates to the high cost of constructing private power projects, says Davis. 

According to the provincial Budget and Fiscal Plan “increases in energy costs [are due] largely to a greater proportion of energy requirements being met through imported energy and from new sources of supply generated by independent power producers.”  [Page 21, Budget and Fiscal Plan] A corroborating statement is made in the BC Hydro Service Plan. [Page 31] 

Customers are going to be penalized through their hydro bills, even though market electricity rates are expected to remain stable, increasing only modestly over the next several years ($56.99 US per MWh in 2008 to $60.99 US per MWh in 2012). [Page 35, Crown Corporations Service Plans] 

“During a period when British Columbians are facing serious economic hardship, this is a bitter pill to swallow,” Davis said. "With a provincial election looming only a few months from now, the people will finally have the opportunity to send a clear message to the government about its privatization agenda,” she added. 

BC Citizens for Public Power, a grassroots, non-profit advocacy organization, was formed in 2002 to fight the privatization of BC Hydro operations.


For more information: Melissa Davis at 604-681-5939 or cell 778-887-5878.

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