BC Hydro fiscal 2011 results released
Regeneration program to upgrade and renew B.C.'s electricity system continues through fiscal 2012
VANCOUVER – As BC Hydro continues to provide and invest in clean, reliable electricity for British Columbians, this week the utility released its annual financial results for fiscal 2011.
The results include consolidated net income of $589 million for the year, which was $142 million higher than last year primarily due to higher domestic revenues and lower operating costs.
BC Hydro’s consolidated financial statements are available as part of the company’s annual report, which was also released this week.
Lower operating costs are due to lower expenditures from electricity and gas purchases and lower finance charges. Higher domestic revenues are due to higher average customer rates and an increase in the rate rider, effective April 1, 2010. These increases were previously announced and adjusted on January 1, 2011 through a rate credit and rate rider reduction to customers.
BC Hydro undertook $1.5 billion of capital expenditures in fiscal 2011 – part of an extensive overall plan to meet growing demand for electricity in British Columbia and renew and revitalize its aging infrastructure to continue to power B.C. with clean, reliable electricity for generations.
Looking ahead to fiscal 2012, BC Hydro will continue the extensive internal review started company-wide in late 2010 to find and implement cost savings and efficiencies that will reduce rate increases. BC Hydro’s filing with the British Columbia Utilities Commission (BCUC) includes a commitment to realize $95 million in operating cost savings over the next three years.
“Over the past fiscal year, we have made significant investments in our electricity system that are evidence of our commitment to ensuring we find the right balance between regenerating our aging assets and keeping rates as low as possible, and among the lowest in North America,” said BC Hydro President and CEO Dave Cobb. “Fiscal 2011 was also the second straight year we have experienced extremely low system water inflow , which meant we needed to buy energy from other sources to meet customer demand.
"Even with historically low water levels in the past year, we were able to successfully meet customer demand through the prudent management of available resources including other power suppliers. Finally, we started in 2011 and will continue in the coming year to make every effort to constrain our own costs while preserving our ability to deliver safe, reliable service, as any cost savings we achieve go directly to lowering rates.”
Key financial highlights for the fiscal year include:
- The Negotiated Settlement Agreement on BC Hydro’s F2011 Revenue Requirements Application (RRA) confirmed an overall average annual rate adjustment for domestic customers of an increase of 7.29 per cent for Fiscal 2011.
- Domestic revenue was higher, due mainly to higher rates in fiscal 2011 while sales volumes were comparable to the prior year. Trade revenues were lower as a result of lower electricity trade sales volumes and prices primarily due to ongoing uncertainty about the strength of the economic recovery in the U.S. and a cool summer season on the U.S. west coast, partially offset by lower trade energy purchase costs.
- System water inflows during the year were at 86 per cent of average as a result of low winter snowpack levels and lower than normal precipitation. This follows a similar low water year in fiscal 2010 in which system water inflows were 87 per cent of average.
Water supply for the past two water years has been some of the lowest on record. The 2010 Water Year (Feb-Sep 2010) was 81 per cent of normal and the lowest in 51 years of record. As a result of the low inflows, BC Hydro experienced a 6 per cent reduction in hydro generation levels and was required to increase energy purchases from other sources to meet customer demand. - The net consolidated electricity purchases for domestic use were 4,463 gigawatt hours – an increase of 1,059 gigawatt hours from the previous year.
- Capital expenditures of $1.5 billion on property, plant and equipment in the year were approximately $900 million lower than the previous year, largely due to BC Hydro’s acquisition in fiscal 2010 of a one-third interest in the Waneta dam and generating facility. Excluding the Waneta acquisition, capital expenditures in fiscal 2011 were comparable to the previous year.
About BC Hydro
Fifty years ago, British Columbians turned to BC Hydro to build the clean electricity system they count on to power B.C.'s economy, create jobs in every region, and keep the lights on. Now, BC Hydro is building again for the next 50 years.
B.C. continues to grow and so has the need for more electricity. That’s why BC Hydro is building, renewing, and encouraging conservation to meet today’s needs and those of future generations. In 2011, BC Hydro is celebrating 50 years of providing power for British Columbians, and inviting them to help prepare for the next 50 years.
See the BC Hydro 2011 Annual Report [PDF, 3.7 MB]
For more information, please contact:
BC Hydro Media Relations
Direct: 604 928 6468