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Carbon rules in California may mean more BC Hydro rate hikes

VANCOUVER (NEWS1130) – Our hydro rates are going up by four percent beginning in April, but an expert says we should brace ourselves for even more hikes down the road.

It’s all because of California’s new carbon cap-and-trade regulations. California is BC Hydro’s biggest international customer, but the state’s new rules mean the utility will have to buy costly carbon credits on its energy exports beginning next year.

Energy economist Aldyen Donnelly tells us BC Hydro is being tagged as a dirty energy producer because it hasn’t disclosed its greenhouse gas emissions to the state.

“Under the California rules, all of the electricity producers who have plants in California get all of the quota they need for free, but everyone who exports quota to California has to buy it on the open market,” she explains.

“California has stipulated that everyone that sells electricity to them must fully account for the greenhouse gas emissions associated with the electricity they import. BC Hydro has not yet done that and for that reason the State of California has assigned an excessively high carbon charge,” she adds.

BC Hydro uses its energy export revenue to lower the rates for BC consumers. Next year, the utility was  expecting to take in $113 million from energy exports.

Although the California regulations went into effect on January 1st , power suppliers have been given one year to comply with the new rules.