The GST shuffle, plus other industrial program updates
What you need to know about current offers, including key deadlines
Why does the customer need to pay the GST for a fully funded energy study? What are the deadlines for energy study agreements, and when does the study have to be done? What else is new for our industrial customers?
Industrial marketing manager Steve Quon is here to answer those questions as part of a fall 2020 industrial programs update.
CRA requires that customers pay the GST
Quon admits that the GST process around our energy study and audit funding is anything but perfect.
"The customer is responsible to pay for the GST, but will be reimbursed by BC Hydro later," says Quon. "It's not a BC Hydro thing, it's a [Canada Revenue Agency] thing. This is how we need the process to work moving forward."
Qualified industrial customers still get 100% funding for energy studies, but must first pay the GST as part of the required CRA process. Here are the steps involved:
- Alliance member provides invoice to BC Hydro. Only one version of the invoice needs to be provided, with the value of services rendered separated from the GST amount.
- BC Hydro provides payment for services to the Alliance Member, excluding the GST amount.
- BC Hydro notifies the customer that the invoice has been paid, excluding GST.
- Customer pays the GST to the Alliance Member.
- Customer submits proof of GST payment to BC Hydro.
- BC Hydro reimburses the customer for the GST amount.
Quon says that both customers and consultants will be sent reminders of the process soon. And if anyone has questions about the process, they can email him.
Energy study offer agreement deadline is November 1, 2020
We fully fund industrial studies, which are available to all industrial customers, regardless of whether they're in the strategic energy management (SEM) program. And the studies must be completed by March 15, 2021.
Energy efficiency feasibility studies are aimed at systems using more than one gigawatt-hour of electricity per year. For a 200-horsepower system, that's about 6,000 hours of operation.
We normally fund the study 100% but claw back 25% if a customer doesn't implement enough of the study's recommendation. For a limited time, we're waiving the 25% recovery portion.
Learn more about the energy study process [PDF, 106 KB]
Project funding for distribution and transmission customers
For a limited time, we've removed the 75% funding cap and may fully fund a qualifying project up to 100%. The project needs to meet our cost-effectiveness tests, and the maximum dollar value caps remain at $1 million for transmission customers and $500,000 for distribution customers.
Before you call us to talk about a project plan that might qualify for up to 100% funding, check out the requirements.
"We get a lot of calls, emails and texts saying, 'I've got this opportunity, what do you think?," says Quon. "But not all those projects qualify. So I tell everyone to check out the requirements before you put in much effort."
Distribution incentive agreements needed to be fully executed by September 1, 2020 to qualify, and those projects need to be completed by March 15, 2021.
Transmission incentive agreements need to be completed by December 1, 2020, but customers have until March 15, 2022 to complete what tends to be much more involved work.
Up to 25% bonus for self-serve incentive program (SIP) projects
For those customers who managed to complete their incentive agreements by the September 1, 2020 deadline, the next deadline is completion of work no later than March 15, 2021.
Open to all customers, regardless of strategic energy management participation, the SIP offer is aimed at facilities using more than 500 megawatt-hours of electricity per year and who want to upgrade compressed air systems and/or industrial lighting.
"We'll now add up to a 25% bonus on top of the incentive amount, and potentially fund up to 100% of the project," says Quon. "So with a $10,000 incentive, customers could now receive up to $12,500, provided the completed project meets our cost-effectiveness tests. Not only that, we'll also remove the one-year payback rule."