Rates to increase for homeowners, lighting and wholesale customers, and decrease for business, large industrial and transmission industrial customers
FortisBC Inc., advised today that it will begin rebalancing electricity rates among customer groups, starting May 1, 2011. The rebalancing will occur in compliance with the British Columbia Utilities Commission (BCUC) order on the utility’s cost of service analysis and rate design application, which underwent an extensive regulatory and public review process. Rebalancing will ensure that each customer group pays their share of the costs required to serve them, but does not generate any extra revenue for FortisBC. As a result, FortisBC’s residential, lighting and wholesale customer rates will increase, while business and industrial groups will see rates decrease. On May 1, 2011, residential, lighting, and wholesale customer rates will increase by 2.5 per cent, and will be offset by a 5.5 per cent reduction for business and large industrial customers and a 3.2 per cent reduction for industrial transmission customers. There will be no change for irrigation customers.
For the average homeowner using 1,000 kWh per month, this will mean an increase of about $2.50 monthly.
“All utilities complete a cost of service analysis periodically, for review and approval by their regulator, to ensure rates are fair and equitable between customer groups. This makes sure no one type of customer is subsidizing another,” explained Tom Loski, vice president, customer service, FortisBC. “The resulting rate adjustments for FortisBC customers will be phased in over several years to limit any rebalancing rate increases to no more than 2.5 per cent per year and allow customers to gradually adjust to the changes.”
Under the Utilities Commission Act, the BCUC has the authority to require FortisBC to apply certain methods and formulas to determine the cost of providing service to each rate class, and to set rates on that basis.