When you’re an activist for vested interests, complete and accurate reports are never offered. These might educate low-information voters that have supported BC Liberals for many years.
The utility loses money on every watt of private power it buys and resells. That is the single largest financial difficulty faced by the company. In the future, it is obliged to buy about $60 billion of electricity from IPPs at prices that will increase with inflation. There is no pressing need for most of the IPP production but the obligation for its purchase cripples BC Hydro.
If you are paying attention to the affairs of BC Hydro, you know the utility in in financial trouble. However, it is electricity consumers that are feeling the pain. Unfortunately, with billions of dollars in phony assets to be written off, a growing power supply that outstrips static demand, payments to private power producers at three times market price and an an export market awash in surplus power, the economic agony dealt by BC Hydro will accelerate.
I assume that logic and fact will prevail and Site C, the most expensive public project in BC history, will be cancelled. It is a costly disaster but BC Hydro ratepayers are burdened even more by payments to independent power producers (IPPs). Much of the almost $100 million a month paid to IPPs leaves the province permanently because majority ownership is domiciled elsewhere. Private producers are paid a multiple of the wholesale value of the electricity they deliver.
In the 20 years to 2006, BC Hydro’s charge per kilowatt-hour to residential consumers increased at 1/3 the rate of inflation. However, when Gordon Campbell’s neoliberal friends decided BC’s iconic utility was a ripe target for privatizing public wealth, things changed dramatically. In the 10 years to 2016, BC Hydro’s charge per kilowatt-hour to residential consumers increased at 5x the rate of inflation.
A message to BC Hydro: “Figure out what you are supposed to be doing, then do it. W.A.C. Bennett established this vital crown corporation to provide reliable, affordable power to British Columbians. That’s what it should be doing. Instead, it is forcing citizens to pay much higher prices to provide financial benefits to foreign owned companies and a band of me-first IPP slicksters and a group of political contributors gaining returns on their liberal investments by sitting in the boardroom of BC Hydro.
Despite deep cynicism about journalists backing BC Liberals, I had long held respect for the writing of Vaughn Palmer. My reservoir of appreciation has now run dry. He has been bright, skilled and articulate, usually worth reading throughout 35+ years with the Vancouver Sun. Now, I don’t know. Is he distracted, overburdened, grown careless or captured by his subjects?
Regular readers know that BC has a surplus of electricity, created mainly by BC Hydro’s steadily increasing purchases of private power, even though domestic consumption has been flat since 2005. Export markets are unprofitable and that situation has continued for years. Proof is offered by BC selling Columbia River electricity outside the province for about one-quarter of BC Hydro’s marginal cost of power. If BC Hydro doesn’t need costly Narrows Inlet power, why are 5 projects on 4 creeks proceeding?
Economists write papers on the circular flow of income but they don’t include the flow between politicians, businesses and the public treasury. In BC, it is commonplace. If you are an observer grown cynical – like the writer – you may wonder what secret benefits are to be found in the circular flow of income between Government, the governing party of British Columbia from 2001 to 2017 and the companies they purport to regulate.
BC residents: we’ve been played for fools by BC Liberals, the private power industry and a complicit media. Between 1997 and 2015, the utility increased assets by $17 billion and added another $4 billion by December 2016. With markets flat but purchases from Independent Power Producers rising steadily, BC Hydro must reduce production of low-cost hydroelectricity in its own facilities.
Well connected Liberals have a long and proud history of maximizing personal opportunities. They know how to make meaningful asset transfers with great discretion. After all, that is the fundamental purpose of an unprincipled political party.
Anne Cameron: Well, we’re less than 300 fulltime residents, we’re at the end of a goat track, we’re an hour and a half out of Gold River and, frankly, who gives a poop. We’re being fleeced by two corporations, and we’re being screwed by the government which allows out-of-sight out-of-mind pillage which they will insist on calling “resource extraction”.
Fraser Institute, the taxpayer supported voice of Canada’s billionaires and multimillionaires, uses the Vancouver Sun to raise a question, “Will a Horgan-led government keep the NDP’s election promise to balance the budget, and if so, how?” We provide answers.
BC Hydro and their consultants have not moved up the learning curve despite being wrong year after year for more than 12 years and sadly the BCUC has let them ride on this way. The consequence of being deliberately wrong for 12/15 years is the condition we now have. Residential and small business rates up +70% with no increase in demand. We also have new contractual debts of plus $60 billion to IPPs…
Politically connected individuals took advantage of citizens’ desire for clean, renewable energy and the Liberals wrote contracts with “lucky firms” that bore no relationship to market prices and guaranteed massive private profits and ensured all financial risks were carried by the public. The contracts in British Columbia last as long as sixty years and involve prices that are now as much as 5x market value. In addition, the contracts have annual inflation escalators.