Category: Independent Power Producers (IPP)

Rising prices have only just begun

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.

Falsehood flies, truth comes limping after it

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.

Careless or captured?

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?

Liberal friends win, taxpayers lose

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?

Circular flow of income

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.   

Played for fools

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.

“…and we’ll never get any of them in jail”

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”.

BC Hydro deliberately failing to notice changes in our world

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…

Electricity has never been cheaper, but…

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.

Unprecedented financial scandal

The mismanagement of BC Hydro is a financial scandal unprecedented in BC’s history. Unfortunately, the corporate media refuses to report these facts. Their loyalty is to not to citizens and taxpayers but to the vested interests that have hands firmly in our pockets.

Special friends, special treatment

While BC Liberals and ardent supporters such as the Fraser Institute claim to favour free markets, private power contracts show how false the commitment is. We can’t know the price paid for AltaGas power in BC because contracts are secret but the amount is certainly more than three times the $33 per MWh market price paid in Alberta. This demonstrates why big businesses in this province are putting up big dollars to ensure Liberals continue controlling government. British Columbia is rich in natural resources but Christy Clark and friends are determined that profits should accrue to very wealthy friends and are not to be wasted on ordinary citizens.

IPP losses about $800 million in 2016

Despite the flat demand for power, BC Hydro is not only buying more private power, its capital spending program is out of control. As a result, despite a reduction in sales to BC customers since 2005, the utility’s assets in 2016 are 256% of the total eleven years ago. With Site C and other major capital projects, we can expect assets to grow by another 15-20 billion dollars in the near future. BC Hydro’s politicized management, under directions from Victoria, are hiding bad news with accounting trickery and, while they’ve increased the average price to residential and business consumers by 74% since 2005, the rates must rise significantly or the province must reverse the flow of cash from the public treasury to the accounts of BC Hydro.