Linemen install new power infrastructure in downtown Victoria. (Tom Fletcher/Black Press)

B.C. Hydro’s $5.5 billion in deferred debt puts pressure on rates

Auditor General says 29 accounts a complicated system

B.C. Hydro customers will have to pay off $5.5 billion in operating debt that has been pushed into the future to keep rates from spiking, and it’s not yet clear how the NDP government is going to tackle that.

Energy Minister Michelle Mungall’s initial effort to freeze rates was blocked by regulators, requiring a 3.5 per cent increase in 2017. Last year’s increase was another three per cent, similar to what the B.C. Liberal government had scheduled in its 10-year rate plan.

RELATED: B.C. Hydro freeze refused, rates go up 3% for 2018

RELATED: NDP looks for ways to rein in B.C. Hydro rates

In June of 2018, Mungall announced separate reviews of Hydro’s capital and operating debt, with outside experts to find a way forward, after the NDP government reluctantly decided to complete the $10 billion Site C project.

A key goal for Mungall is to return rate-setting to the B.C. Utilities Commission, after a series of directives from the previous government that drew accusations of political interference to make B.C. Hydro’s financial picture look better than it is.

On Wednesday, B.C. Auditor General Carol Bellringer released the latest report on B.C. Hydro’s deferred operating debt, which is separate from the billions in capital debt racked up for project such as Site C on the Peace River, the John Hart Dam reconstruction on Vancouver Island and the Ruskin dam and powerhouse rebuild in the Fraser Valley.

Deferring the bills of major storms and other unexpected spikes in operating costs is normal practice for utilities, Bellringer says. But B.C. Hydro’s network of 29 accounts is unusually complicated, with “rate smoothing” effects on future rates unclear.

In their response to Bellringer’s report, the ministry and B.C. Hydro emphasize that current customer rates are already on track to pay off 25 of the 29 deferral accounts.

Three that are not are the “customer crisis fund” account, the “Site C regulatory account” and the “rate smoothing regulatory account.”


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

Just Posted

North Delta crime beat, week of Oct. 6

A selection of property crimes submitted weekly by the Delta Police Department

$50,000 reward for ‘extremely violent’ South Surrey murder suspect renewed

Offer for information on Brandon Teixeira to remain in effect through April, 2020

Surrey moves to ban sleeping overnight in RVs, motorhomes on city streets

Proposal comes amid complaints about homeless people living in recreational vehicles

Surrey restaurant owner who pointed handgun at staff loses court appeal

Jawahar Singh Padda tried to get his 30-month sentenced reduced

South Surrey man allows smart meter installation ‘under duress’

BC Hydro says devices emit fraction of radio frequency from a cellphone

ELECTION 2019: It’s so close, it could come down to who turns out to vote

Black Press Media’s polling analyst on the origins of predictive seat modelling in Canada

Jack’s Devils beat Quinn’s Canucks 1-0 in NHL brother battle

New Jersey youngster scores first career goal against Vancouver

Two charged after owner’s wild ride through Kamloops in his stolen truck

Crystal Rae Dorrington, 37, and Derrick Ronald Pearson, 32, facing multiple charges

Kamloops Blazers blank Vancouver Giants

A loss on the road for G-men

Man found dead inside Richmond business, IHIT investigating

Police believe the incident was not random

Judge orders credit union’s bank records for Kelowna social worker facing theft allegations

The man is accused of negligence, breach of contract, fraud and a conspiracy with Interior Savings

Leaders pour it on with rallies, boosts for candidates as campaign reaches peak

The federal election campaign has reached a crescendo

Allegations of racism lead to ministry investigation at Vancouver private school

St. George’s School was contacted over what the school describes as ‘deeply offensive behaviour online’

Not a political question: Thunberg calls for climate action in Alberta

Edmonton police estimated the size of the crowd at about 4,000

Most Read