BCUC decision on BC Hydro's Revenue Requirements Application for F2009-F2010 On March 27, BC Hydro issued a compliance filing with the British Columbia Utilities Commission (BCUC) in response to the commission's March 13 decision on BC Hydro's two-year Revenue Requirements Application [PDF, 2.5 Mb] for fiscal 2009 and 2010. The Revenue Requirements Application reflects the expenditures BC Hydro requires to operate in fiscal years 2009 and 2010. The application was originally filed with the commission in February of 2008. Based on the BCUC decision, BC Hydro has calculated that rates will increase by 2.34 per cent in fiscal 2009 (ending March 31, 2009) and by 8.74 per cent in fiscal 2010 (starting April 1, 2009). As a result, and given the interim rate increase of 6.56 per cent that has been in effect since April 1, 2008, customers can expect a credit refund for fiscal 2009. Customers can expect to receive their refund in the May/June billing cycle. Please see our Hot Topics section for more information about rates. The full BCUC decision is available here [PDF, 2.5 Mb].

For many years we have relied on the firm, reliable power generated from our heritage hydroelectric assets. But these dams and infrastructure, built in the 1950s, '60s and '70s, require significant reinvestment. And we need to add new sources of clean, renewable power to our system to meet demand for reliable power.

In fact, BC Hydro forecasts that the demand for electricity in British Columbia will grow between 20 and 35 per cent over the next 20 years.

To accomplish our objectives, BC Hydro applied for rate increases over fiscal years 2009 and 2010 with the British Columbia Utilities Commission (BCUC).

• What's happening to business rates
• Why rates are increasing
• How are rates determined
• What's happening to rate rider
• How customers can reduce the impact on their bills

What's happening to business rates

On March 27, BC Hydro issued a compliance filing with the British Columbia Utilities Commission (BCUC) in response to the commission's March 13 decision on BC Hydro's two-year Revenue Requirements Application [PDF, 2.5 Mb] for fiscal 2009 and 2010.

The Revenue Requirements Application reflects the expenditures BC Hydro requires to operate in fiscal years 2009 and 2010. The application was originally filed with the commission in February of 2008.

Based on the BCUC decision, BC Hydro has calculated that rates will increase by 2.34 per cent in fiscal 2009 (ending March 31, 2009) and by 8.74 per cent in fiscal 2010 (starting April 1, 2009).

As a result, and given the interim rate increase of 6.56 per cent that has been in effect since April 1, 2008, customers can expect a credit refund for fiscal 2009. Customers can expect to receive their refund in the May/June billing cycle.

Why rates are increasing

BC Hydro requires additional revenue to:

• Reinvest in our existing electricity generating assets and ensure they continue to produce power well into the future. This means replacing, updating and upgrading components, systems, and structures within our generating facilities.
• Invest in transmission and distribution systems to ensure the electricity generated in our facilities reaches homes and businesses when it is needed.
• Acquire additional clean energy to ensure we continue to meet the growing demand for electricity.

Planning for the future: BC Hydro's long-term forecasting indicates that in two decades our province will require as much as 35% more electricity than we have today.

Aging facilities and infrastructure: Aging infrastructure has a profound effect on the ability of the electric system to be secure, safe and reliable. Many of BC Hydro's large generation facilities were built in the 1950s, '60s and '70s. Many of the mechanical and electrical components are near the end of their life. Today's investments will extend the life of our facilities.

For example, BC Hydro is making significant investments to renew several dams and generating facilities, including: Seven Mile Dam, Peace Canyon Generating Station, G.M. Shrum Generating Station (WAC Bennett Dam), Aberfeldie Generating Station, and the Coquitlam Dam.

BC Hydro is also expanding electricity generation at the Revelstoke Generating Station by adding a fifth 500-megawatt turbine (with the potential to add a sixth turbine), and is considering the addition of two new turbines at the Mica Generating Station.

Increased energy costs: Historically, BC Hydro has been able to use the surpluses created by investments in the 1950s, '60s and '70s to meet growing demand. By 2001, BC Hydro was no longer in a surplus position and became a net importer of electricity.

To meet this growing demand for electricity, BC Hydro is acquiring additional clean and renewable energy from independent power producers, as well as continuing to purchase from the market.

How your rates are determined

The rates your business pays depend on these factors:

1. Your demand for electricity. Customers who have an electricity demand of 35 kilowatts (kW) and over are billed on a rate schedule that includes a basic charge, a charge for electricity consumption and a charge for demand. Customers who have a demand less than 35 kW are billed on a rate schedule that includes a basic charge and a charge for electricity consumption.
2. Your supply voltage. Hydro supplies its general service customers with electricity either at primary voltage (750 volts or more) or secondary voltage (less than 750 volts).
3. The area of the province in which you are located. Customers in Zone II remote locations not connected to Hydro's grid are charged under different rate schedules. Customers in Zone II with demand greater than 45 kVA (kilovolt amperes) may be required to be served under a special contract.

BC Hydro's Business rates apply to most commercial and industrial electricity users in Zone I. Your Hydro bill shows the rate schedule and electricity rates that apply to your business.

Zone I The integrated system served mainly by hydroelectric (water) generation, to which 99% of our customers are connected.

Zone II The non-integrated system (areas with no access to the integrated system) where electricity is generated by diesel and some small hydroelectric plants.

The following rates are as of April 1, 2009, and have been approved by the BCUC. Also as of April 1, 2009, a 1.0% Rate Rider* is shown on a separate line on customer bills.

*The rate rider is applied to the total of all charges, before taxes and levies. Amounts received from the rate rider will be used only to pay down BC Hydro's deferral accounts. BC Hydro uses these accounts to record unexpected costs and prevent sudden rate fluctuations that could result, for example, from higher-than-forecast market prices for energy.

General Service (Commercial): Under 35 kW for 2 months
Small businesses such as stores, small warehouses, offices, auto repair shops. Demand is less than 35 kW and a demand meter is not normally installed. Schedule 1220 of the Electric Tariff.
Basic Charge:	16.17 cents per day
All kWh:	$0.0769 kWh
Minimum Charge:	The Basic Charge
Rate Rider:	1.0% Rate Rider applied to all charges, before taxes and levies

General Service (Commercial): 35 kW and Over for 1 month
Retail stores, medium industry, manufacturing, schools, office buildings, supermarkets. Demand is 35 kW or over and a demand meter is usually installed. Schedules 1200, 1201, 1210, 1211 of the Electric Tariff.
Basic Charge:	16.17 cents per day
Demand Charge:	First 35 kW for NIL
	Next 115 kW at $3.94 per kW
	All additional kW at $7.56 per kW
Energy Charge:	First 14,800 kWh $0.0769 per kWh
	All additional kWh $0.0370 per kWh
Discounts:	1.5% on entire bill if customer's electricity is metered at primary potential.
	$0.25 per kW if customer supplies transformation from a primary to a secondary potential.
	If a customer is entitled to both discounts the 1.5% discount is applied first.
Minimum Charge:	50% of the highest maximum demand charge billed in any month within an on-peak period (1 November to 31 March inclusive) during the preceding 11 months.
Rate Rider:	1.0% Rate Rider applied to all charges, before taxes and levies

Industrial: Transmission Service
Mines, chemical plants, large sawmills, pulp and paper mills, large manufacturing. Schedule 1823 Transmission Service, of the Electric Tariff.
Demand Charge:	$5.260 per kVA of billing demand
Energy Charge:	$0.02608 per kWh applied to all kWh up to and including 90% of the customer's baseline load (CBL) in each billing year
	$0.07360 per kWh applied to all kWh above 90% of the customer's baseline load (CBL) in each billing year
Minimum Charge:	$5.260 per kVA of billing demand per billing period
Rate Rider:	1.0% Rate Rider applied to all charges, before taxes and levies

What's happening to the Rate Rider?

As of April 1, 2009, the rate rider will increase to 1.0% from 0.5%. The rate rider will appear as a separate line item on customer bills. Revenue generated by the rider will be allocated to paying down existing debts incurred due to unpredictable events such as storm damage and fluctuating energy prices.

How customers can reduce the impact on their bills

BC Hydro recognizes that any rate increase can be a challenge to customers. However, customers can reduce or completely avoid these increases by changing a few habits and conserving electricity.

We're committed to helping you achieve energy efficiency and sustainability through Power Smart solutions. Power Smart for Business can help you learn about tools designed to enhance your energy management expertise and improve your bottom line through efficient energy use.