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The provincial government’s decision to freeze BC Hydro’s rates in 2018 likely won’t have any effect on FortisBC customers.
While the majority of British Columbians get their power from BC Hydro, FortisBC provides electricity to a swath of customers in southern B.C., including Kelowna, Princeton and Osoyoos.
The company’s rates are set each year by the British Columbia Utilities Commission, based on the day-to-day costs as Fortis, as well as the cost of capital upgrades.
“As a regulated private utility we need to set our rates based on the actual cost of providing day-to-day services, as well as making sure we can address any necessary upgrades,” company spokesperson Nicole Bogdanovic says.
Fortis submitted its requested rate increase for 2018 long before the BC Hydro rate freeze was announced. The utility asked for a 0.17 per cent bump over its 2017 rates, starting in January.
The BCUC will make the final decision over what Fortis can charge its customers, but Bogdanovic says her company expects the BC Hydro rate freeze will have a “minimal impact” on the BCUC decision.
The BCUC typically doesn’t make its final decision on the year’s electricity rates until well after the new year begins, and Bogdanovic says Fortis normally asks to temporarily raise its rates at the beginning of the year, until it gets an official word.
However, because Fortis is asking for a “minimal” rate increase for 2018, Bogdanovic says the company probably won’t make that request in 2018.
Bogdanovic said she’s often asked why Fortis rates differ from BC Hydro rates, and pointed out that the crown corporation needs to cover its operating costs the same way Fortis does.
“While they also have to set their rates based on revenue requirements, it sounds like they may be making this decision (the rate freeze) for other reasons,” she said.
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