PEOPLE POWER is a six-chaper 50 minute DVD designed to help activists launch grassroots community-based campaigns to protect public power and the environment.
High Tension: BC Hydro’s Deep Integration with the U.S.through RTO West
Big changes are planned for BCs electricity transmission system. The most startling is that the BC government is planning to give away the operation and control of the system to a U.S. body, RTO West. This action will result in higher rates, greater environmental damage, and the expansion of the system to meet U.S., rather than BC needs.
Big changes are planned for BCs electricity transmission system. The most startling is that the BC government is planning to give away the operation and control of the system to a U.S. body, RTO West. This action will result in higher rates, greater environmental damage, and the expansion of the system to meet U.S., rather than BC needs.
The BC government's recent Energy Plan proposes that BC Hydro turn over its transmission system to a U.S. entity called R.T.O. West. Plans to have this happen are well advanced. According to U.S. and BC government documents, all planning, investment and operation decisions for BC's provincial transmission system will be the responsibility of RTO West.
This regional transmission organization, which will start operations by fall of 2004, is an amalgam of mostly private electricity market players from the western U.S. BC Hydro has participated in planning of the new organization, but once it is set up the entity will be controlled in the U.S. Domestic needs for the movement of publicly produced electricity will then take second place to the demands for export of power produced privately.
The first step in the transfer of transmission to RTO West is the separation of transmission from BC Hydro. BC Hydro will be broken up through the creation of a new BC Hydro Transmission Corporation. BC Hydro, through this, will lose all the numerous advantages that currently exist from having transmission as an integral part of the BC Hydro system. The government claims that it isrequired to break up BC Hydro in order to export power to the U.S., because of demands by the U.S. regulatory body, FERC.
This paper challenges the necessity of BC's complicity with FERC (the U.S. Federal Energy Regulatory Commission) and shows that the BC government is entering into this arrangement voluntarily. These changes are not required under the North American Free Trade Agreement. In fact, NAFTA, through its provisions for ‘ national treatment' protects the export rights of each country in the agreement. BC, however, is giving up a significant right that NAFTA guarantees each country.
Even within the U.S. there is considerable opposition to the FERC proposals for RTO West. This is mainly because FERC is a federal agency that has no jurisdiction even over state and municipal utilities in the U.S. and is over-stepping its legitimate mandate. However, unlike the Western Governor's Association, federal Senators, public utilities and municipalities in the Pacific Northwest which are mounting strong opposition to the F.E.R.C. proposals, the BC government is actually assisting in the process of turning over BC's public electricity to U.S. control.
The RTO West system will fundamentally change the way that transmission will operate. One of the most significant changes will be a complex new transmission-pricing regime to manage what is referred to as ‘congestion' on the system. Ultimately a market system will be established and rights to transmit electricity will be tradable. It is the kind of system that will introduce speculation into the pricing mechanism and could seriously jeopardize security of supply, particularly in current low-cost regions. Prices will reflect whatever the market will bear at specific locations, so there will be a ratcheting up in response to desperation of customers or market manipulation.
The new system will benefit large private energy producers, but BC consumers and businesses will pay the price with higher rates, higher air pollution and a refocus of the energy system to meet export, rather than BC needs. The changes promoted by F.E.R.C. will open the door to a California style electricity disaster in BC
Rather than blindly following the directives of a U.S. regulatory agency, the BC government should halt its plan to break up BC Hydro and join R.T.O. West. At the very least, the people of BC should be consulted before the public utility is dismantled.