BCUC must end its discriminatory electricity pricing against rural customers
- Len Kelsey, Chair & CEO, BCUC, The Honourable Christy Clark, The Honourable Bill Bennett
UPDATE March 21, 2015:
On February 2nd, 2015, Nicholas Swart of Kelowna met with MLAs Thomson and Letnick, as well as Ms. Becky Harmata, assistant to Premier Clark, to outline his concerns with the two-tier rate structure. He gave them a presentation explaining the flaws in the current two-tier rate structure. In his presentation he provided them with comparisons of actual Fortis bills that illustrated why the pricing structure is unfair. MLAs Thomson and Letnick indicated that they had received complaints from many other constituents on this matter over a long period, and that they would be meeting with Minister Bennett in the near future to discuss the issue with him.
On February 13, 2015, Nick Marty and Mark McKenney engaged in a telephone conference call with officials at the Ministry of Energy & Mines on the subject on unfair electricity rates. Nick's presentation to them can be viewed at the link below.
Further to this call, a telephone conference call with Minister Bennett and MLA Linda Larson has been scheduled for April 14, 2015.
On March 14, 2015 Nick and Mark met with residents of Midway, many of whom are suffering similar financial hardships as residents of rural Osoyoos as a result of discriminatory electricity pricing. Nick took them through the presentation that he had previously made to the Ministry of Energy.
Between now and April 14th, it is important that residents continue to put pressure on the Government to revise the so-called Residential Conservation Rate which essentially "taxes" those residents who use electricity for space and water heating (primarily rural residents) with the proceeds being used to subsidize the electricity rates of those using natural gas to heat their homes. This means signing or encouraging others, anywhere in the Province, to sign this petition
The petition provides an opportunity for signatories to make comments to the Government about their individual situations. A number of signatories have mentioned that BC Hydro is their electricity provider. The Block prices under BC Hydro are somewhat different than those under Fortis, however, BC Hydro's two-tier system is equally flawed in design and, as such, also discriminates against, and unfairly penalizes, customers who use electricity for space and water heating. In addition, some signatories have pointed out that not all residents who use electricity for space and water heating live in rural areas. The intent of this petition is to get BCUC to fix or replace the current two-tier Residential Conservation Rate in all regions of BC (not just Fortis' service area) and to prevent price discrimination against any resident who uses electricity for space and water heating (rural and urban).
For those who, in addition to signing the petition, wish to complain directly to the Government, there are draft letters below that can be customized by residents to reflect their specific situation and then sent to the British Columbia Utilities Commission, the Minister of Energy (and the Premier) and to Fortis.
In 2012, the British Columbia Utilities Commission (BCUC) directed Fortis to implement the Residential Conservation Rate (RCR). The stated objective of the RCR is to encourage greater electricity conservation in support of the BC Energy Plan.
The RCR was incorrectly designed. As a result, it unfairly penalizes those residents who use electricity for space and water heating; primarily rural residents who have no access to natural gas. The revenue from the excessive charges placed on rural customers is then transferred to all remaining customers (primarily urban customers who have access to natural gas) in the form of lower electricity rates. This encourages the latter to use more electricity, not less.
We demand that the BCUC immediately fix the design of their so-called conservation rate. If they refuse, once again, to do so; we demand that the Government of BC instruct them to correctly design the RCR so that it no longer discriminates against rural customers and actually encourages all customers to conserve electricity as required by the BC Energy Plan.
The RCR, as designed, negatively affects rural residents, not because they are failing to conserve or are energy inefficient, but solely because they use electricity for space and water heating. At the same time, it is rewarding urban residents with rate reductions without their having made any efforts towards conservation behavior.
The BCUC claims that the RCR is meeting the objectives of the BC Energy Plan but they have never provided any evidence to support their claim. Our position is that the RCR was improperly designed and, as a result, is failing to meet the objectives of the BC Energy Plan. We believe that the following facts, contained in Fortis' progress reports, clearly support our position. The RCR:
-does not maximize energy conservation efforts since it encourages 68.5% of customers to consume more electricity by lowering their electricity bills;
-only targets 8% of customers (those who use electricity for space and water heating because they have no access to natural gas) by raising their rates 42% (from 9.5 cent/kWh to 13.5 cents/kWh) over the last 2 1/2 years on virtually all of the electricity that they consume to heat their homes; and
-encourages rural customers to switch from environmentally-friendly technologies, such as geothermal or solar, to wood heating that generates harmful air emissions.
The failings of the RCR could be largely addressed either by setting a higher Block threshold for those customers with no access to natural gas (e.g. equal to 90% of their average annual electricity consumption) or by returning to a flat rate for these customers and continuing the two-tier pricing for the remaining customers. Other ways could be found for encouraging conservation among the flat-rate customers; for example, by bringing back time-of-use pricing.
We, the undersigned, call on BCUC to order Fortis to end its discriminatory electricity pricing against rural customers.
The BCUC must end its discriminatory electricity pricing against rural customers petition to Len Kelsey, Chair & CEO, BCUC, The Honourable Christy Clark, The Honourable Bill Bennett was written by Nicholas Marty and is in the category Consumer Affairs at GoPetition.