Nelson Hydro has requested a general rate increase of 2.85 per cent beginning April 1, in light of the higher cost of buying power from FortisBC.
Fortis rates went up 3.3 per cent on January 1. This impacts Nelson Hydro because it buys about 45 per cent of its power from Fortis each year — the hydro generating station on Bonnington Falls doesn’t produce enough to cover all of the city’s power needs during peak times.
Nelson Hydro general manager Alex Love was at a city council meeting Monday to inform council of the need for an increase. He’ll formally ask councillors to approve the change in early February, then it will go to the BC Utilities Commission for review before taking effect in the spring.
“We are forecasting the lowest rate increase in the province,” Love said, adding that the residential hydro rates in Nelson are about 11 or 12 per cent less than what FortisBC offers.
BC Hydro, which provides power in the lower mainland, is requesting a nine per cent rate increase for April 1.
If the new Nelson Hydro rate had come into effect January 1, it would have only needed a 1.97 per cent increase to generate the same amount of revenue.
In addition to paying a higher cost of wholesale power purchases, Love said Nelson Hydro’s costs are more because of pole replacements and vegetation management around poles, which help reduce power outages.
He cited an example of a wind storm this past summer that left much of the Slocan Valley without power, but only caused two issues in Nelson affecting about 70 customers.
“In years gone back we could have easily had four- or five-thousand customers off and two days of steady work,” Love said.
City manager Kevin Cormack commended Nelson Hydro for staying on top of its capital upgrades and maintaining healthy reserve funds, noting that much higher rate increases would be needed if that had not been the case.
