News Release: BC Liberals Double Down on BC Hydro Mismanagement

June 27, 2013

Union Says Transmission Line Latest in a Long List of Bad Decisions

BURNABY – The Canadian Office and Professional Employees Union local 378 (MoveUP) is dismayed, but unsurprised, by BC Hydro’s cost overruns announced in today’s BC Budget Update. MoveUP represents 1,850 inside workers at BC Hydro.

The updated budget highlights the BC Liberals’ continued mismanagement of BC Hydro. North West Transmission Line costs continue to climb, in part because the government is massively under-collecting costs from mining corporations and other major users. MoveUP had warned the Utilities Commission the rates for those users were far too low when the project cost was still pegged at $561 million, estimating the subsidy to be worth about $150 million to mining corporations and other corporate interests. But the price tag has ballooned to $700 million and the contribution asked of mining corporations and other major users has stayed the same. Their share has not gone up to represent the new project costs, giving these users a free ride.

The difference between the costs BC Hydro is incurring and the amount these users are paying will be borne by BC Hydro’s other customers. That amounts to a huge subsidy of the major Northwest corporate customers by everyone else.

The union also warns that BC Hydro ratepayers should ready themselves for a substantial rate shock within the year. Another attempt by the government avoid a politically unpopular rate hike by deferring the rising costs will only make the inevitable shock even worse.

“This government has now gone more than a decade without taking the actions necessary to deal with real cost drivers and address debt at BC Hydro,” said MoveUP President David Black. “They keep doubling down on their mistakes. The Northwest Transmission line cost is only one in a long list of bad decisions. You can count backwards from last year’s stunning choice to push off a smaller rate increase until after the election, to the debt hidden in deferral accounts, and to subsidizing expensive and damaging private power projects. This government has made it a mission to hurt one of our most valuable public assets.” 

Prior to the election the government’s numbers showed Hydro’s debt would increase by more than $4 billion to $18.8 billion in 2015. This includes the infamous deferral accounts, which were sharply criticized by outgoing Auditor General John Doyle, but does not include today’s announcement of increased capital spending to deal with cost overruns.

Today’s budget update raises more questions about the feasibility of the BC Liberals’ plan to pay off BC Hydro’s and the province’s debt.

MoveUP has asked for a meeting with the new Minister of Energy and Mines, Bill Bennett, and is looking forward to discussing these issues further with him.


Media contact:

Sage Aaron, Communications Director