B.C. VIEWS: Get ready for Hydro rate hikes

Construction and maintenance costs rising, and so is government demand for BC Hydro revenue to balance budget

Energy and Mines Minister Bill Bennett

VICTORIA – There’s a new sheriff in town for BC Hydro, and it didn’t take long for the political range war to resume.

The new sheriff, Kootenay East MLA Bill Bennett, found himself on the barricades as soon as he got the hugely complex responsibility for energy and mines. His saddlebags bulge with reports on BC Hydro’s seemingly runaway costs, along with Premier Christy Clark’s “core review” to cut $50 million a year from government operations.

NDP energy critic John Horgan highlighted the latest BC Hydro troubles in his assault on the B.C. Liberal budget. First there was a $140 million cost overrun on the Northwest Transmission Line, under construction north from Terrace to the tiny Tahltan village of Iskut and adjacent mine properties.

Then BC Hydro revealed results of an audit of its earthquake preparedness. “Condition red” was the key message. Basically, the sprawling utility has disaster plans for each of its dams or other power facilities, but no overall way to get the provincial power grid back up after a major earthquake.

Horgan recited his list of BC Hydro sins after a decade of meddling by the BC Liberals: huge deferred debt revealed by the Auditor General, enormous liabilities for private power contracts, and more rate increases that Bennett has already admitted are on the way. And now they can’t even keep us safe from the big one.

Bennett fired back. About $2 billion of that debt is for seismic upgrades for the 80-year-old Ruskin Dam in Maple Ridge, and the equally frail John Hart Dam on the Campbell River, built with wooden water pipes. Major BC Hydro works slowed down after completion of Revelstoke and Mica dams in the 1980s, and now the work is more expensive.

The Northwest Transmission Line is a partnership with Imperial Metals, which wants to power its Red Chris copper-gold-silver mine. Bennett said the company is not only paying for the last section to Iskut and the mine site, but pitching in for the main line as well. Ottawa paid $130 million to get remote communities off decades of dependence on diesel generators.

AltaGas, owner of one of those private power projects in the region, puts in $180 million to get connected to the grid. The line will open up more mining and hydro possibilities.

The cost overrun traces back mainly to the shortage of high-skill labour such as geotechnical engineering that the remote region already faces. And this is before natural gas pipelines and LNG plants gear up.

Bennett takes over from the last sheriff, Rich Coleman, who put BC Hydro through the wringer in 2011. Coleman soon abandoned his idea of putting off the Ruskin and John Hart upgrades (again) to keep rates low through the election, and saw the B.C. Utilities Commission jack up the rate increase to seven per cent to help slow the ballooning debt.

What’s ahead for rates? The utility is looking for 32 per cent in the next three years, says energy lawyer David Austin. He calculates that only 2.5 per cent is attributable to increased private power costs. Among other things, BC Hydro needs regional emergency centres capable of functioning after a Japan-sized quake, plus expansion.

Bennett came clean on another reason for rate increases – the government’s increasing dependence on taking a “dividend” as BC Hydro’s lone “shareholder.”

The newly updated budget tells us this annual “dividend” is past $500 million and rising fast: $545 million this year, $611 million next year and $684 million the year after.

Tom Fletcher is legislative reporter and columnist for Black Press and BCLocalnews.com

 

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

VIDEO: gunshots fired outside Langley gas station

Two people involved left scene uninjured, police said

B.C. families financially affected by pandemic eligible for grocery gift cards

Program open to struggling families in Lower Mainland and Fraser Valley communities

VIDEO: Art in the time of COVID: how a Langley exhibition managed it

Holding the charitable event depended on which phase of restrictions were in effect

Three TWU grads named to first ‘Fellows’ program at Langley-based university

Program selects promising recent graduates to participate in a year-long paid internship

‘Each step is a prayer’: Ojibwe man will walk from Hope to Vancouver Island for Indigenous healing, reconciliation

James Taylor departs Sept. 20, returns to Saanich in five days for sacred fire

B.C. or Ontario? Residential school survivors fight move of court battle

It’s now up to Ontario’s Court of Appeal to sort out the venue question

Young B.C. cancer survivor rides 105-km with Terry Fox’s brother

Jacob Bredenhof and Darrell Fox’s cycling trek raises almost $90,000 for cancer research

B.C. migrant, undocumented workers rally for permanent residency program

Rally is part of the Amnesty for Undocumented Workers Campaign led by the Migrant Workers Centre

Preparations underway for pandemic election in Saskatchewan and maybe B.C.

Administrators in B.C. and around the country are also looking to expand voting by mail during the pandemic

Nearly 20 per cent of COVID-19 infections among health-care workers by late July

WHO acknowledged the possibility that COVID-19 might be spread in the air under certain conditions

Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Ferry riders say lower fares are what’s most needed to improve service

Provincial government announces findings of public engagement process

Air quality advisory ends for the Lower Mainland

It had been in effect since Sept. 8

Supreme Court Justice Ruth Bader Ginsburg dies at 87

The court’s second female justice, died Friday at her home in Washington

Most Read