Despite a decade of flat domestic demand, BC Hydro continues to add unneeded capacity and increase purchases from independent power producers. The utility not only buys more from IPPs, it pays more, up to 5 times Northwest Power Pool (NWPP) market prices.
However, because BC Hydro sells electricity to heavy industries for less than it pays independent power producers (IPPs), residential users and taxpayers must make good the losses.
BC Liberal schemes have cost billions of dollars already and will cost citizens tens of billions more.
So, if demand for electricity is flat, even declining, why is BC Hydro paying more than a billion dollars a year for power from independent producers? Without domestic demand growth, increased purchases from IPPs result in idling of existing BC Hydro generating capacity. Yes, that’s the cheap power we could be enjoying today.
During the period that BC Hydro was paying IPPs about $90 per MWh, the market rate for power (MID C) was between one-fifth and one-third of that price, even after accounting for exchange.
Note: The figures shown shown here are extracted from BC Hydro’s annual and quarterly reports.
Categories: BC Hydro