Political directives have undermined B.C. Hydro’s finances, auditor general says

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Politicians should stop bossing around the independent regulator that oversees B.C. Hydro so the province can get a true sense of what electricity rates customers need to pay, says the auditor general.

Auditor General Carol Bellringer on Wednesday outlined the concerns about Hydro that caused her to place a qualification on the B.C. government’s year-end financial report this week.

The most significant issue is $5.5 billion in expenses Hydro has pushed into deferral accounts to be paid by ratepayers in future years. That’s a common practice among North American utilities to prevent unexpected rate hikes, said Bellringer, but to be acceptable under accounting rules it has to be accompanied by oversight from an independent regulator, in this case the B.C. Utilities Commission.

Instead of allowing unfettered oversight, the previous Liberal government used cabinet orders since 2012 to override the utilities commission and set Hydro’s rates directly, said Bellringer.

“Government direction has largely pre-determined B.C. Hydro’s allowable costs,” Bellringer told reporters Wednesday. “The overall effect has been to limit rate increases and increase the amount of B.C. Hydro’s deferral accounts.”

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Rob Shaw – Vancouver Sun – August 30, 2018.

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