For many years, I worked in the motion picture film laboratory business. One of our profit centres was processing TV News film footage. We had machines in or near TV stations in Vancouver and Victoria.
If a story was breaking, news departments would dispatch a reporter and cameraman to the scene. Rolls of exposed 16mm film got forwarded to the lab, developed and sent to the station’s editing department. Within hours, if all went well, the story would be on air.
Most film used in TV news was manufactured by Eastman Kodak. It also supplied camera stock to moviemakers and photographers and print stocks and papers to film labs around the world. The powerhouse company employed 60,000 in the city of Rochester, New York, and more than a few were involved in research and development of new products. One was Steven Sasson, a Kodak scientist who invented the first self-contained digital camera.
The company’s management feared the engineer’s filmless invention and refused to embrace it. Sasson says he was instructed to tell no person outside the company about the device.
Failure to adapt to new technology was a major reason that Kodak, which once had annual sales exceeding $10 billion, filed for bankruptcy protection in 2012.
Kodak’s manufacturing processes were complex and barriers to competitors had been substantial. Yet new video and digital photography attracted numerous players, even people without immense capital, special skills and experience.
Writing about Kodak in Forbes, innovation consultant Tendayi Viki said this:
…gaining and protecting a competitive advantage works in business environments that have long term stability. However, such environments no longer exist. The rapid pace of technological advancement has changed the dynamics in most industries. Most companies now need to develop the ability to respond to change quickly…
BC Hydro not only failed to respond quickly to technological advances in power generation, it pretends they are without consequence. Weakened by its long-term policy of buying private power and reselling at a fraction of its cost, the provincial utility created financial reports that, according to Dr. Eoin Finn, deserve awards for fiction. Instead of facing up to money troubles, BC Hydro lied about them.
The company raised residential rates 73% between 2007 and 2017, while inflation was 17%. It will be forced to continue boosting prices well ahead of other services or commodities — and wages — because it is near insolvency and spending billions to add more unneeded capacity.
Export prices for electricity have been under 4¢ per KWh for many years and utilities in traditional markets outside BC are adding wind power for less than 4¢ per KWh, after subsidies. Prices for utility-scale alternatives have dropped dramatically in the past decade and new technology even allows small users to rely less on traditional suppliers.
As BC Hydro rates rise, new power sources will be ever more attractive to many of its customers. Consumers may make their own or acquire electricity from new sources. Barriers that long protected BC Hydro are disappearing, just as Kodak’s went away.
As with the once formidable film company, BC Hydro’s management has been blind to market changes. Instead of introducing transformational innovation, they chose to do business in old ways.
Despite existing electricity surpluses, they still add high-cost private power (IPPs) while ignoring auction methods that allow other utilities to buy at comparatively low rates. And, of course, they are spending $10.7 billion on Site C and billions more on other new facilities.
Because our government lacks the wisdom or the nerve to change the utility’s course, BC Hydro is a mounting financial disaster that affects every citizen of British Columbia.
MGM Resorts and other Nevada corporations paid big money to leave the Nevada state grid to buy electricity on the open market. With rapidly rising prices, consumers will be finding BC Hydro rates worse than alternatives. #SiteC #bcpolihttps://t.co/dRhLXHat4L https://t.co/RvYSieDiDx
— Norm Farrell (@Norm_Farrell) February 14, 2018
Zero value has been applied to the 100 km of productive valley to be flooded. 2 RFPs on BC Bid to deal with "potentially acid generating" material. Price just keeps going up by the minute.
— Bob Fedderly (@bob_fedderly) February 16, 2018