Business customers move to flat rates
Your customers should be aware of changes to rates and charges
This story was updated in October, 2017.
As an Alliance member you've likely looked at countless BC Hydro bills while helping customers understand their usage patterns and the charges associated with them. And you know how to use billing information to best understand what savings can be achieved with an energy efficiency project.
Here's a look at several recently announced changes, including rate structure changes effective April 1, 2017, and the BC Government-announced phasing out of PST charged on BC Hydro business bills over the next two years.
Flat rates introduced for medium, large business customers
Customer and stakeholder feedback on the current Large General Service (LGS) and Medium General Service (MGS) baseline-based rates encouraged BC Hydro to review them and to propose simpler, flat rates in our 2015 Rate Design Application. These rates were approved by the British Columbia Utilities Commission (BCUC) this past January and took effect on April 1, 2017.
When your LGS and MGS customers got their bills after April 1, 2017, they may have had questions about the changes. You can help them understand that:
- The new rates don't require monthly baselines
- These rates don't have tiered pricing for energy and demand charges, as customers will be charged the same rate for all their energy they use (measured in kWh) and the same rate for all of their demand (measured in kW), including the first 35 kW of demand that used to be free of charge.
We anticipate that these flat rates make it easier for you to assist your customers to plan and budget their electricity costs as well as their energy efficiency and expansion projects. You're now able to calculate the financial savings associated with your energy efficiency projects more easily.
Small General Service and Residential rates maintained
Small General Service (SGS) customers are currently on a flat rate, and this rate structure won't change. A small change these customers may notice and inquire about is a slight increase in the basic charge that more reflects BC Hydro's cost of services such as metering and billing. To offset this increase, there will be a corresponding decrease to the energy charge.
BC Hydro believes the two-tier conservation rate has proved effective in promoting conservation among residential customers. And the BCUC agreed with our proposal to maintain the two-tiered rate.
As part of the BC Budget unveiled on February 14, 2017, the BC Government announced that the tax rate on electricity for BC Hydro business customers will be reduced to 3.5% from 7%. And business customers could be fully exempt starting April 1, 2019.
The final decision on when the PST on business bills is phased out is yet to be determined by the current BC Government.
BC Hydro residential electricity bills are already exempt from the PST.