BC Hydro

BC Hydro, provider of social and corporate welfare

BC Hydro has long been used for political purposes by governments of British Columbia. John Horgan’s NDP crew is not different than its predecessors. Today, they announced a series of social measures BC Hydro will offer.

  • Residential customers who have lost their jobs or are unable to work as a result of COVID-19 will receive a credit to help cover the cost of their electricity bills. The credit will be three times their average monthly bill over the past year at their home and does not have to be repaid.
  • Small businesses that have been forced to close due to COVID-19 will have their power bills forgiven for April, May and June.
  • Major industries, like pulp and paper mills and mines, will have the opportunity to defer 50% of their bill payments for three months.
  • Some customers may also be eligible for BC Hydro’s existing Customer Crisis Fund, which provides access to grants of up to $600 to pay their bills.
  • BC Hydro has halted all service disconnections for non-payment during COVID-19 and cancelled all non-emergency planned power outages affecting its customers.

Assisting people in need during an economic crisis is appropriate but government should be doing it, not a crown corporation with commercial operation as its primary function.

These measures could cost BC Hydro $100 million or more and, if the need continues longer than three months, as many expect, the cost will rise. Whatever the amount, it will ultimately be recovered through higher rates for electricity.

Escalating utility prices hit residents and small to medium sized businesses without regard for ability to pay. Through progressive taxation, government has the ability to raise funds from people best able to pay.

Of course, this April 2020 initiative to have BC Hydro deliver economic assistance is tiny compared to the scale of corporate welfare programs the company has been required to deliver.

Until the current Peace River projects, supporting independent power producers (IPPs) has been the costliest program. Those companies have been paid $12.6 billion since 2004, with most contract rates about 3x market.

Site C will cost $12 billion or more and it is not needed to meet demand of residential and business consumers. That’s been flat since 2004 and IPP purchases have more than doubled.

The new Peace River dam will provide power to natural gas producers and processors but they will only pay a fraction of the new energy cost. Additionally, BC Hydro is paying hundreds of millions of dollars for transmission and distribution infrastructure to serve natural gas companies.

BC Liberals put disastrous policies in place for BC Hydro. But the NDP has lacked the courage to alter the utility’s path dependency even though good business management calls for that.

Politics explains reluctance to reshape the status quo. Government leaders want voters to believe the provincial economy is vibrant and expanding and the narrative of steady load growth suits the desired image.

Years ago, BC Hydro developed expansion programs to prepare for demand growth that it projected to be 40% over 20 years. In fact, it still uses those numbers in public communications, as shown today on this web page.

The company’s latest Twenty-Year Load Forecast filed with BCUC cuts by half the expected increases in demand. It says BC Hydro expects annual load growth of approximately 1% for fiscal 2020 to fiscal 2039. Like all the forecasts in the past fifteen years, the latest is fantasy. It will be wrong in year one and it ignores developments in renewable energy and the certainty that distributed generation will lure customers away from the provincial grid.

Unwillingness to change utility directions has created an unwieldy and hugely inefficient behemoth. Look again at the sales chart shown above and then examine this one:

The $12 billion utility delivered more power to BC residential and business consumers in calendar year 2005 than the now $38 billion utility delivered in 2019.

Categories: BC Hydro

8 replies »

  1. Delivered more ENERGY in 2003, you mean. Not power. Power is the rate of delivering energy, typically over a 15 minute or hourly period in the electrical utility business. It’s called DEMAND by the actual technical folk, not necessarily used correctly by the brochure writers who haven’t much of a clue. Your loosey goosey terminology continues unabated.

    Seriously, when the small hydro producers first tried to sell energy unsuccessfully to NS Power in the 1980s, they got crucified by the utility consultants and even the Utility Board lawyers at hearings for not having much of a clue what they were talking about. It was the entrenched bureaucracy and the establishment winning on points against the small guy.

    The brighter independents soon began to learn the jargon AND what it meant physically/electrically in the industry. They also learned the safety aspects of having a live feed on the grid when the local system went down, and why connection wasn’t just a simple matter of hooking up wires. Sadly, I haven’t seen any progression in your understanding whatsover in five years. I tried to explain to you, you didn’t listen. You’ll be forever flapping your gums and dismissed by the experts if you don’t get down to learning how an electrical utility system works and what the terms mean. No sign of it on your part yet. Too bad. I don’t think you’ve even tried.

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    • The Hydro and Power Authority Act defines power thusly:

      “power”, except in sections 12 (1) and 38 (2), includes energy, light and heat however developed or produced, and includes electricity and natural, manufactured or mixed gas, or liquefied petroleum gas;

      The Act states that:
      The authority’s purposes are
      (a)
      to generate, manufacture, conserve, supply, acquire and dispose of power and related products

      http://www.bclaws.ca/civix/document/id/complete/statreg/96212_01#section17

      Now, however “loosey goosey” the terminology of the legislation, I believe Norm’s audience knows exactly what he’s talking about. And most can spot a red herring.

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    • Semantic games do not alter the facts stated here. But you might remember the full name of the provincial utility is British Columbia Hydro and Power Authority.

      The Oxford Dictionary gives this as one of the definitions of power, “Electrical energy supplied to an area, building, etc.” and follows with an example sentence, “30,000 homes were left without power.” Elsewhere can be found this definition, “Power is energy per unit of time.” As in GWh.

      The OED defines another term you will be familiar with: “ad hominem – In a way that is directed against a person rather than the position they are maintaining.”

      Urban Dictionary has a succinct definition, “Ad hominems are used by immature and/or unintelligent people because they are unable to counter their opponent using logic and intelligence.”

      Liked by 1 person

    • Mr. Malcolm, I detect some didactic upset coming from you regarding the terminology of “power” and “energy”. I can understand that the misuse of the terms might get under your skin. But, I do believe that you’ve focused in on the “tree” and just missed the “forest” in terms of understanding the economic boondoggle that Mr Farrell just described. I can forgive him for an oversight a terminology problem. I am not sure (from your rant in the final paragraph) that you understand the big picture….. Would you rather hone in on Nero’s fiddle instead of noticing that Rome is burning?

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  2. The information speaks for itself. The utility has been used for political purposes for many years. The Site c dam never was needed and never had a business case. Campbell deliberately bypassed the BCUC which rejected it. His misnamed “Clean” Energy Act had two purposes, one was to foist the dam on unsuspecting ratepayers and the second was to foist expensive IPPs onto unsuspecting ratepayers. As rates increase to cover the spiraling costs at the dam it is an insult to ratepayer/taxpayers to apply for a 1% decrease to rates prior to the Site c debt bomb hitting the books. It can’t be hidden. Job creating industries will seek cheaper jurisdictions and Campbell’s party will complain about the high cost of doing business in BC. Long term thinking never entered those minds.

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  3. Hey Bill? Have you ever read a book by a bloke called Perkins about “The Confessions of an Economic Hit-man”? Just google him. What he talks about certainly applies to our boon-doggle projects such as IPP’s, Site C, Trans Mountain, and LNG. Pure and simple economics; the projects cost more than they’re worth because the DEMAND isn’t there. And oh yeah, Norm is doing a pretty good job on explaining to the great unwashed on what is happening here in BC.

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  4. “The $12 billion utility delivered more power to BC residential and business consumers in calendar year 2005 than the now $38 billion utility delivered in 2019.”

    That’s a compelling summary, Norm.

    Keep holding up a mirror for BC Hydro. One day, someone might walk by and notice they are looking a ‘little’ fatter — and DO something about it.

    Liked by 1 person

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