To the editor:
In his Aug. 24 column, headlined Power export plan isn’t dead yet, Tom Fletcher says the self-sufficiency policy imposed on BC Hydro is starting to make more sense, but I disagree.
According to recent articles in the Vancouver Sun (Aug. 20), BC Hydro’s new contracts to purchase energy from Independent Power Projects (IPPs) average $124/MWh. The average of $65/MWh that BC Hydro paid for power from IPPs in 2010 is due to older, less costly IPP contracts.
The Sun also stated open-market prices for electricity range from $4 to $52 per MWh. Who knows where this price will go in the future.
In the meantime, BC Hydro is stuck with new contracts for energy from IPPs at much more than the current market rates.
The B.C. Liberal government’s self-sufficiency and “insurance” policy for BC Hydro is enshrined in the 2010 BC Clean Energy Act.
This policy forces BC Hydro to have a large surplus of electricity. This surplus would be exported, apparently at rates much less than the price that BC Hydro pays for electricity from IPPs.
The Vancouver Sun quoted BC Hydro CEO Dave Cobb saying that getting rid of the government’s self-sufficiency policy will free BC Hydro from purchasing hundreds of millions of dollars worth of electricity from IPPs that it doesn’t need.
BC Hydro forecasts that its annual payments to IPPs will rise to $939 million by 2014. Apparently for over-priced electricity it doesn’t need, but is forced to purchase due to government policy. I don’t see how this makes sense.
Hugh Thomas
100 Mile House
