Something hinky’s going on with Hydro’s application to the Utilities Commission. Despite the claim by Michelle Mungall there’s going to be a ‘rate reduction for the first time in decades’, that is in fact a fallacy
So today, our provincial NDP government has
announced that we will be paying ... less
for electricity next spring if the BC Utilities Commission (BCUC) approves BC
Hydro’s request for a decrease in rates.
“For the past two years, our government
has been focused on making sure BC Hydro works for people again,” said Michelle
Mungall, Minister of Energy, Mines and Petroleum Resources. “I am thrilled
that BC Hydro is now able to apply for a rate reduction for the first time in
decades. If approved by our independent regulator, lower rates would make life
better and more affordable for British Columbians.”
Here’s the thing though -- that decrease, if
approved by the BC Utilities Commission, will be 1% beginning in 2021 ... but
it will be followed by an INCREASE of two point seven percent (2.7%) in 2021
Then in 2022 Hydro has requested to reduce our rates, this time by by POINT three percent (0.3%) ... which will again be followed by another INCREASE of three percent (3%) in 2023
Then in 2022 Hydro has requested to reduce our rates, this time by by POINT three percent (0.3%) ... which will again be followed by another INCREASE of three percent (3%) in 2023
WHAT’S THE BOTTOM LINE?
We have is a total decrease in our BC Hydro
bill, if approved by the BC Utilities Commission of 1.3% over the next four
years ... which will be wiped out 5.7% increase during the same time period.
Getting back to the BC Government News media
release, it states that:
BC Hydro’s application to the BCUC is based
on its audited fiscal 2019 financial results and latest financial forecast that
reflect, among other things, higher-than-anticipated income from its trading
subsidiary Powerex, lower-than-anticipated forecast debt financing
costs and lower-than-anticipated purchases from independent power
producers (IPPs).
“As a result of our updated financial
forecast, we’re in the unique position to apply for a rate decrease for our
customers that would start on April 1, 2020, if approved by the BC Utilities
Commission,” said Chris O’Riley, president and chief operating officer, BC
Hydro.
“We’re committed to continue to work with
government and the B.C. Utilities Commission to keep rates affordable while
ensuring we continue to provide safe, reliable power to the province.”
BC Auditor General Carol Bellringer |
BUT ... hold on a minute Chris. What did CBC News have to say less than six
months ago?
"Customers on the hook for $5.5
billion in deferred BC Hydro operating costs: report"
Auditor
General Carol Bellringer says BC Hydro has deferred $5.5 billion in expenses
that it plans to recover from ratepayers in the future.
Bellringer focuses on the deferred
expenses in a report on the public utility's use of rate-regulated
accounting to control the prices it charges customers.
"As of March 31, 2018, BC
Hydro reported a total net regulatory asset of $5.455 billion, which is what
ratepayers owe," says the report. "BC Hydro expects to recover
this from ratepayers in the future. For BC Hydro, this is an asset. For
ratepayers, this is a debt."
She says rate-regulated accounting is
used widely across North America, but cautions that Hydro has largely
overridden the role of the independent B.C. Utilities Commission to regulate
rates.
There’s something hinky going on with BC Hydro’s
application to the Utilities Commission. Despite the claim by Minister of
Energy Michelle Mungall that there is going to be a ‘rate reduction for the
first time in decades’, that is in fact a fallacy.
... and I defy any mathematician to prove otherwise!
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