Hydro rates could rise 30 per cent
B.C. Hydro’s $800-million plan to fix up aging Ruskin Dam will mean higher hydro rates, despite a minimal increase in power production.
The project is a major piece of B.C. Hydro’s $6-billion plan for upgrading aging facilities across the province.
“We are entering a regeneration phase at B.C. Hydro,” CEO Dave Cobb said on a media conference call Tuesday afternoon. “We went through a period from the mid ’90s to the mid 2000s where we invested relatively small amounts.
“The tough decisions were put off for years.”
As a result, the provincial power utility is faced with the daunting task performing overdue upgrades at a time when power demand is expected to climb 40 per cent in the next 20 years.
“We deferred and put off investments for a decade, and so we’re now at a point where we need to reinvest in our system,” said Cobb.
That reinvestment will come at a cost, however, and it will be residential rate-payers who will bear the brunt of higher power fees, if the plan is approved.
In order to pay for the upgrades, B.C. Hydro has applied to utilities commission to increase the energy rates it charges customers.
Currently the average residential customer pays close to $71 per month. Under B.C. Hydro’s new rate scheme, which BCUC is expected to approve in coming weeks, customers will pay around $7 more per month every year for the next three years – a total rate hike of close to 30 per cent.
“We are fortunate that we are starting with relatively low rates compared to most jurisdictions in North America,” said Cobb. “But that still doesn’t lessen the burden on people.”
He notes that customers can lessen the impact by making more of an effort to conserve energy. To that end, B.C. Hydro is planning to install Smart Meters on all homes in B.C. by mid 2012. The meters will provide real-time information to customers on how and when they’re using electricity.
In addition to encouraging conservation, the $930 million project will help recoup an estimated $100 million per year lost to energy theft. In total the program hopes to save $1.6 billion over the next 20 years.
In 2008, B.C. Hydro also introduced a two-stage rate, which charges customers at a higher rate for excessive energy use.
“We want to encourage conversation,” said Cobb. “If we don’t conserve as much as we need to, the impact could be worse.”
The Ruskin Dame project still has to be approved by the B.C. Utilities Commission, which B.C. Hydro anticipates could take close to a year.
Given the age of the dam, which was built in 1930, B.C. Hydro was faced with the decision of either rebuilding the dam, or decommissioning it altogether.
“It’s definitely worth the investment to build it up to a modern facility,” said Cobb. “We continue to generate significant energy with significant capacity.
“It’s a meaningful asset in our system.”
The powerhouse equipment is at the end of its life, and currently poses a safety and environmental hazard, said Chris O’Riley, B.C. Hydro’s senior vice-president of generation.
The dam will only see a modest increase in generating capacity, however. The powerhouse’s three 35 megawatt generators will be replaced, allowing for a 10 per cent gain in power generation, said O’Riley. When finished, the dam will provide enough energy to power 33,000 homes, or roughly a city of the size of Maple Ridge.
A major component of the project will be making sure the dam will be able to withstand a major earthquake.
“The situation in New Zealand ... is a real reminder of the need for us to update our current system, and in particular for seismic needs,” said Cobb.
More than 100 people died and hundreds more are still missing after a 6.3 magnitude earthquake in Christchurch, New Zealand on Tuesday.
The Hayward Lake reservoir behind the dam has already been lowered, Cobb said, as a result of seismic fears.
The project is expected to generate approximately 1,050 person-years of employment, however, B.C. Hydro won’t say how many jobs that translates to.
B.C. Hydro anticipates the major contractors would likely hire locally, meaning opportunities for subcontractors, local service providers and small businesses for supply and sundry items, local food, accommodation, rentals, and building/land lease.
The Mission Chamber of Commerce has developed a directory of local businesses to share with B.C. Hydro and the major contractors on the Ruskin Dam project. B.C. Hydro also plans to host a business opportunities networking session to provide an informal opportunity for local contractors and suppliers to exchange business information with the contractors short-listed for the Ruskin project.
The Ruskin Dam upgrade project will require the closure of Hayward Street from Wilson Street to Keystone Avenue for the duration of the project, with access provided for local residents only. In addition, during the work to upgrade the dam’s right bank, single lane closures on Wilson Road will be required.
Several recreation facilities in the area will also be closed when construction begins for safety reasons including the B.C. Hydro Ruskin Recreation Site downstream of dam, the Lower Railway Trail parking lot and the lower part of the Reservoir Trail. Access to the reservoir from Hayward Lake Reservoir Recreation Site, downstream of Stave Falls dam, will also be restricted during the drawdown periods from mid-May to early August 2012 and 2013).