The B.C. government has promised to restore the B.C. Utilities Commission’s independent role in setting electricity rates and add more full-time commissioners to help them do it.
Energy Minister Bill Bennett released an independent review of the commission Wednesday, and said the government intends to implement all 35 recommendations. Authority over setting BC Hydro rates for commercial and residential customers won’t be restored until 2017, after Bennett and Premier Christy Clark stepped in to cap rate increases in 2013.
The review comes after the government exempted big-ticket projects from BCUC review, including the Site C dam on the Peace River, the wireless electricity meter system and a new transmission line to northwest B.C. that ran $300 million over the original budget.
Bennett announced the government directive on BC Hydro rates after the 2013 election, with a 10-year plan that increases rates 28 per cent over five years. He acknowledged at the time that rate increases were being kept low using a “rate smoothing” account that defers more than $1 billion of the utility’s debt.
BC Hydro rates are to increase six per cent this year under the province’s directive, and then be capped at four per cent for two years after that..
“After the first five years of the 10-year plan they [BCUC] will be back in charge of setting rates,” Bennett said Thursday.
NDP energy critic Adrian Dix said the B.C. Liberal government has been overruling and sidelining the BCUC since 2003 when it directed BC Hydro to buy power from private producers. He said its political intervention on rising BC Hydro rates is designed to continue holding down rate increases until after the 2017 election.
Dix said it’s also no coincidence that Bennett received the independent review in November and held onto it until after the government had announced its decision to proceed with construction of the Site C dam.
The review panel and the regulated utilities agreed that the government has authority to set provincial energy policy and direct the BCUC on specific issues. But the report adds that the government should define those policies well in advance and “then leave the commission to act independently within its mandate.”