Low-carbon Electrification in BC: Empowering BC Hydro to lead
June 2, 2020
More than 230 online participants took in BCSEA’s webinar on low-carbon electrification last week. The session was presented by BCSEA’s Tom Hackney (policy analyst) and Bill Andrews (lawyer), and introduced by BCSEA board chair Jonathan Ho.
The presentation was subtitled “Empowering BC Hydro to lead” because BCSEA is concerned that low-carbon electrification in BC is being stymied by the lack of a clear allocation of roles and responsibilities between the three big players: the BC Government, the BC Utilities Commission, and BC Hydro.
BCSEA called for the BC Legislature to enact a strong legal mandate for BC Hydro to pursue low-carbon electrification, and for the Utilities Commission to publicly review and approve BC Hydro’s low-carbon electrification to ensure the spending achieves the most “GHG reduction bang for the buck.”
“There needs to be a clear legal structure, a long-term plan, and accountability for BC Hydro to achieve GHG reduction goals through low-carbon electrification,” said Tom Hackney. He noted that BC Hydro’s grid electricity has a much lower carbon intensity – tonne of carbon dioxide equivalent (CO2e) per unit of energy (GJ or MWh) – than the fossil fuels it could replace.
Bill Andrews said low-carbon electrification catches BC Hydro between two decision-makers: the BC Government, and the BC Utilities Commission. Under its current mandate, the Commission would disallow BC Hydro from recovering in rates the costs of most low-carbon electrification measures. So the Government legally exempts BC Hydro’s spending on low-carbon electrification from BCUC review and requires the costs to be recovered from BC Hydro customers.
The exemption approach risks pushing up BC Hydro’s rates without achieving optimal GHG reductions. The Government has no mechanism to ensure that the exempted measures are the most cost-effective electrification measures for reducing GHG emissions. This is where the BCUC, an independent, expert tribunal, with full public hearing procedures, should provide a valuable role.
Bill Andrews noted that higher BC Hydro rates makes it harder for clean electricity to compete with fossil fuels on price, even with BC’s carbon tax on fossil fuels. He concluded that cost-effective low-carbon electrification delivers twice the climate action bang for the buck. It achieves more GHG reductions, and it helps electricity prices compete with fossil fuel prices.
Comprehensive Review Phase 2
BCSEA Comments on Interim Report