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 itB次元官网网址檚 not yet clear how the NDP government is going to tackle that.
Energy Minister Michelle MungallB次元官网网址檚 initial effort to freeze rates was blocked by regulators, requiring a 3.5 per cent increase in 2017. Last yearB次元官网网址檚 increase was another three per cent, similar to what the B.C. Liberal government had scheduled in its 10-year rate plan.
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In June of 2018, Mungall announced separate reviews of HydroB次元官网网址檚 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. HydroB次元官网网址檚 financial picture look better than it is.
On Wednesday, B.C. Auditor General Carol Bellringer released on B.C. HydroB次元官网网址檚 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.
Deferral accounts are used to "smooth" rate hikes from major weather events and other operational costs
B次元官网网址� Tom Fletcher (@tomfletcherbc)
Deferring the bills of major storms and other unexpected spikes in operating costs is normal practice for utilities, Bellringer says. But B.C. HydroB次元官网网址檚 network of 29 accounts is unusually complicated, with B次元官网网址渞ate smoothingB次元官网网址� effects on future rates unclear.
In their response to BellringerB次元官网网址檚 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 B次元官网网址渃ustomer crisis fundB次元官网网址� account, the B次元官网网址淪ite C regulatory accountB次元官网网址� and the B次元官网网址渞ate smoothing regulatory account.B次元官网网址�
tfletcher@blackpress.ca
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