BC Hydro

Inept or worse?

At the legislated deadline, just before summer’s last holiday weekend, BC Hydro released financial results for the year ended March 2021. The utility’s annual service report contains pages of interest to serious analysts, but most of it is bumf, likely read only by the company’s PR minions. But a few pages reveal information they’d rather people ignore.

If you’ve read articles about BC Hydro accumulated here over the years, you likely know what would be written again. These charts might say more about British Columbia’s public utility than its 117 page annual report. All charted data is from BC Hydro annual reports.

First, consumption. Despite the utility’s constant lies about steady growth, demand has been essentially flat for 17 years.

Since 2005, BC’s public utility empire expanded dramatically but units of electricity sold to BC Hydro’s residential, commercial and industrial consumers was essentially unchanged. To deliver similar amounts of power, the assets employed more than tripled.

As a conservative, Premier Campbell claimed to oppose “borrow and spend” policies. But those are exactly what he required of BC Hydro. During 17 years of flat demand, the utility’s liabilities soared:

Part of the company’s massive spending resulted in an 18% increase in the company’s capacity to generate hydropower.

Despite flat demand and additional internal capacity, purchases of private power from IPPs quadrupled.

So, how does BC Hydro stay afloat?

By increasing prices.

Forgotten is the W.A.C. Bennett strategy of using low cost power to reward citizens and encourage business growth with inexpensive electricity.

A prominent litigator who sat on the Board of BC Hydro years ago was reputed to have said, “Never waste a good settlement on our client.”

That attitude was modified at BC Hydro to, “Never waste the benefit of cheap power on our customers.”

When Gordon Campbell was Premier, his philosophical direction was to privatize BC Hydro. But he knew the politics of that would be messy. Perhaps fatally messy to his political career. Instead, Liberals privatized a large chunk of the utility’s present and future wealth, writing contracts with independent producers to buy private power worth more than $60 billion.

In a year when other North American utilities were contracting to buy a kilowatt-hour of wind power for around 4¢, BC Hydro was paying IPPs 12¢.

Prices paid IPPs had little to do with market value or cost of production, and the secret contracts had annual inflation escalators. Additionally, volumes of private power supplied had little to do with demand for electricity by BC Hydro’s domestic customers.

Had BC Hydro been managed prudently, business and residential consumers would be paying substantially less for electricity.

But that’s has not been the objective of the utility management or governments led by Campbell, Clark and Horgan.


Categories: BC Hydro

18 replies »

  1. Thanks for this message Norm. It helps BC citizens connect the dots and understand why some of us have been asking for accountability but getting none.

    There is a reason why the present Auditor General is planning an accounting change , effective this coming March. He will either be fired beforehand or he is planning to change our conversations by changing wording.

    Several times I have asked the “travelling road show” , run by MLAs seeking public input to the annual budget making , and every time they refuse to talk about the $100 + billion of contractual liabilities.
    They just pencil it out of all conversations even when they know paying off these large contracts has to come from the pockets of all citizens and it is one big reason we have more poverty than we should have.

    Liked by 1 person

  2. I’ve gotta agree with motorcycle guy. No one could be THAT inept. But, look at us inept taxpayers, or rather ratepayers! I tried to be a small time IPP with solar panels on my roof. They wouldn’t even accept my excess power FOR FREE! Now, THAT is inept.
    No, it has to be something more devious than ineptitude. But I don’t expect to find out in my lifetime, anymore than I expect to know what REALLY went on with BC Rail.
    Enjoy your long weekend! It’s the last one of the summer!

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  3. Thanks for writing this, Norm. I gave up on politicians long ago – they are not just inept … they are, sadly, corrupt. Horgan is no different. I cannot help but wonder into whose pockets the money from you and I as rate payers actually goes.

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  4. It seems to be quite obvious. None of the people in positions of
    power have any skin in the game. Politicians get elected, do the bidding
    of those that wrote cheques to get them elected, hang in there long enough
    to get a pension then exit. The picture of Horgan masked up with family
    (assumed) and the carbon free by 2050 signs was so typical. If we miss
    the target he won’t know because he will be dead. Geeeez. If you want
    to witness the end game just look south of the 49th and we live next door.
    Culture creep is already working it’s magic here.

    Liked by 1 person

  5. Thank you Norm. One more revealing story that prove to all of us regardless of which party we choose corporations will win and their interest and policies implemented. The whole system is rigged to its core.
    The role of government regardless of the color of the party in power is to manage the population while implementing corporate policies and dictates. Horgan, Clark, Campbell are all establishment puppet. They are there to fool us and manage us.

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  6. So tell me again why we are flooding Peace river farm land to build the Site C dam on shale ? Clearly not because we need more power …so why? Winter is coming and seniors will have to decide on medicines, food or heat again.

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  7. Anyone sitting down to purposely design an energy corporation that was wasteful, poorly managed, financially inefficient, and sucked at every pore by parasites would be hard pressed to beat the BC Hydro model.

    They simply couldn’t do it for a public or private corporation because the law and/or the shareholders would oust the Board and the CEO before it got anywhere close to the state in which we find BC Hydro.

    But a Crown corporation, now that’s a different story. With that status, you can arrange the specific legislation, secrecy, bottomless financial backup, and malleable management and oversight necessary for a real nightmare.

    John Horgan knows this of course. And we know he knows because he told us so many times in the past when he was the energy critic for the Official Opposition. Speeches to the Legislature, op-eds in the Vancouver Sun, press conferences, party election platforms, and proposals like PowerBC. It’s all there for the reading. He led us to believe he had the corrective solution and would implement it.

    So what happened? Not just to him, but to every single NDP MLA who now sings from basically the same song sheet as the BC Liberals. Without a program, you can’t tell one from the other when they address the topic in the Legislature, if they address it at all anymore. Who got to them? Why do they appear to check their spines and memories at the entrance to the Legislature before conducting energy-related business on our behalf, enabling destruction of the environment through subsidization of fossil fuel extraction and condoning ongoing pillage of BC Hydro ratepayers?

    I don’t believe John Horgan and the NDP MLAs are stupid or that they’re evil. And they have enacted substantial improvements that wouldn’t have seen the light of day under the BC Liberals. But their actions on natural resources and the energy file in particular do have people who previously supported them politically considering a question that starts with a baseline of ineptitude. So one has to wonder whether the last election victory handed the NDP wasn’t the equivalent of just enough rope to hang themselves.

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    • Hi Lew;
      I think you are being too polite. Everyone in the legislature knows about BC Hydro, especially after the Minister, Board and Executives all agreed to “ditch ” the Annual Report ,that is supposedly a must according to rules of the legislature for crown corporations.

      Since about 2016 the annual reporting is given under the heading “Service Plan” ,which of course allows escape from the risk of signing a document they would be legally accountable for and replacing it with one having no legal accountability attached.

      There is no shame in Victoria these days. Erik

      Liked by 1 person

      • Erik, I take your point. As I said, even previous supporters are having discussions about NDP actions, and the baseline is ineptitude. When the given is that you’re on the wrong path and the only argument among voters is how strong of a pejorative should be used, you’re headed for trouble.

        The service plan and annual report process required by the Budget Transparency and Accountability Act (enacted by the NDP in 2000) has always been toothless in holding Ministers responsible for anything, despite their cover letter to the Legislature (and thereby, you and me) assuring all that they are accountable.

        An example of that is the consecutive annual reports that Minister Coleman filed to the Legislature assuring the citizens of BC that everything was well in hand with activities surrounding Casino gambling. The Cullen Commission, and the investigative reporting and book “Wilful Blindness” by Sam Cooper puts the lie to Mr. Coleman’s assurances. I highly recommend the book for those who haven’t yet read it.

        I also have no doubt that the title of that book could well be used to head any annual report emanating from BC Hydro.

        Liked by 1 person

        • Thanks Lew, it is gratifying to read confirmation as to what is supposed to be a legal requirement but is ignored by Ministers and MLAs.

          It is more than sad that those we give over our trust to, so casually abuse it.

          This is why so many citizens are cynics and those seeing social doom in front of us get a following.

          I haven’t yet figured out where and how J. R. Saul’s view of future global trade fits in but the above certainly creates opportunity.

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          • Yes, that has been an unresolved sore point with me for some years. The very same individuals we send to the people’s house to make our laws breaking them with impunity. Things like routinely and openly flouting the provisions of the Freedom of Information and Protection of Privacy Act, or ignoring legislated reporting requirements might be seen by some as small potatoes, but the culture created through these actions can do very great public harm, not the least of which is the erosion of public trust in our institutions.

            That culture is strengthened when the Premier and the head of the Public Service Agency conduct a two-week investigation into allegations that the Premier’s chief of staff committed a possibly illegal act, but they do so without creating one shred of documentation or referring the matter to law enforcement. Think of the message that sends the rest of the public service about accountability.

            That culture sets the table for civil servants to feel comfortable in ignoring policy and protocol to do things like conducting the despicable witch hunt and firings of health researchers that led to the death of one and ruined the careers of six. Not to mention the millions of public dollars for investigations and reparations, and the harmful delays in needed research. No one was held accountable.

            That culture results in the current Premier and his Attorney General ignoring the previous actions of their current Deputy Attorney General, who facilitated a secret plea deal in a criminal trial that in the opinion of no less than a previous Attorney General and a previous Solicitor General, was illegal. Officials heading the public entity entrusted with the duty to ensure our laws are upheld break the law themselves. And the new heads are fine with it. No one is held accountable. What culture does that foster?

            Unfortunately, there are many more examples. And just as unfortunate is the realization that they will continue to grow in number and magnitude given our current political system. Because accountability is just a buzzword.

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