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Commission approves tariff changes in BC Hydro's rate design application

In its first comprehensive rate design application since 2007, BC Hydro and Power Authority received approval for electric tariff changes and rate structures proposed under the first module of its application.

The British Columbia Utilities Commission issued a decision Jan. 20 regarding the first module, which sought to update the utility's default service rates and certain electric tariff terms. The commission approved holding BC Hydro's residential rate structure, transmission rate structure and small business rate structure unchanged, the utility said in a Jan. 27 news release. The utility charges residential customers a single rate up to a certain threshold and steps up the rate for electricity used beyond that level, and the commission agreed to hold the stepped rate structure unchanged.

However, medium and large business customers, also called general service customers, will see some changes as of April 1. Those customers will move to a flat energy rate from a two-tiered energy rate structure, which BC Hydro said was not well understood by customers and did not lead to conservation, according to the release.

The commission also approved changes to its electric tariff to reflect increased delivery charges and the transition to smart meters.

The commission did not accept BC Hydro's proposal regarding its E-Plus rate, which is a special rate that provides a discount on electricity used for heating in exchange for allowing BC Hydro to interrupt the service during periods of peak power use. BC Hydro had proposed to adjust the terms and conditions of the E-Plus rate, but the commission, instead, preferred that the rate phase out over five years from April 1. Within 30 days of the commission's decision, BC Hydro is to file a proposal that outlines how to achieve the five-year phase out.

In addition, the commission directed BC Hydro to submit a proposal within the next six months to create a Crisis Intervention Fund pilot program. The program would test the idea of a fund to support residential customers unable to pay their electricity bills. The pilot program is incremental to other offerings that BC Hydro provides for low-income customers such as conservation programs and payment plans that give customers more time to pay their bills.

The Crisis Intervention Fund was proposed by intervenors in the rate case including the British Columbia Old Age Pensioners' Organization, Disability Alliance BC, Council of Senior Citizens' Organizations of BC, and the Tenant Resource and Advisory Center. The intervenors had requested that the commission direct BC Hydro to set specific rates for low-income customers such as essential service usage block rates, but the commission said "low income rates unsupported by an economic or cost of service justification are unjust," according to the decision. The commission also dismissed the low-income rate proposal because it would be subsidized by other customers, BC Hydro said in its release.

BC Hydro is still working on the second module of its application, which will address optional residential and business rate proposals, some of which will help customers reduce greenhouse gas emissions and support electric vehicle deployment, according to the release.