Friday, June 15, 2012

BC Hydro: 45% of the cost savings benefit to be derived from the (Smart Meters) SMI project will be from theft detection.

Our BC Hydro rates are 45% too high right now. Why? Theft.

Smart Meters will change all that.

In other words, if your Hydro Bill, on average, has been $200 per month  ($26,400 for the past eleven years) and the Government of the BC Liberals knew that, via their Core Review,  in 2001, why did they continue to siphon off money from BC Hydro every single year, just to Balance their budgets and get re-elected?

Why didn't Campbell act, decisively back then when he had a landslide victory?

What did Campbell do, he started to split BC Hydro asunder, to save money, he said.

Why the band-aid approach?

One household, BC Hydro Bills would have been reduced by $13,200, or there abouts.

There are how many  Households in BC  1,748,845 times $13,200 =  $23,084,754,000

$23 Billion!!!!!
Google Search Criteria for this quote
Charles Reid, president and CEO (acting), BC Hydro -
"Our goal is to keep rates as low as possible for our customers and we are going to continue looking for opportunities to become a leaner and more efficient organization going forward so that we can keep rates low while delivering the investments in our system for future generations."  UPDATED November 24, 2012  Source

"Leaner" means a fatter spending BC Liberal Government who have shoved their multi-year-should-have-been-deficits onto the shoulders of British Columbians children's children, something that Gordon Campbell often used to blame the Opposition of doing.

Look at it this way, all the money that Gordon and Christy have been spending to keep themselves in Office has come from future Generations of British Columbians.

$60 billion debt to build infrastructures in the last ten eleven years;

$5 billion of deferred accounting at BC Hydro because the BC Liberal Finance Ministers needed the hard cash to balance their books.

Like this:  Page 21 of 132  Search for "Deferral"

BC Hydro operates in a rate regulated environment where accounting policies allow the use of regulatory accounts to defer amounts for future recoveries or refunds, subject to the approval of the British Columbia Utilities Commission. In the absence of rate-regulation, these amounts would be included as revenues or expenditures when incurred.  BC Hydro is ordered in some cases by the British Columbia Utilities Commission or given special direction from the province, to defer certain amounts, in order to minimize rate fluctuations and provide a stable return to the shareholder.

Some regulatory account additions, such as the deferral of energy variances, will fluctuate between positive and negative amounts over the years, and can be offsetting over time, but deferred to allow smoothing of rates. Other regulatory accounts, established for the purpose of matching current costs to future benefits, such as expenditures related to Smart Metering and Infrastructure, will be recovered through the rates at a future time when the benefits to the ratepayers from the investment are being realized.

Page 91 of 132   Keep searching for "Deferral"

Rate Structures

BC Hydro rates are competitive with other comparable jurisdictions.

However, there may be the perception of unfairness in the revenue/cost ratios between customer classes. In addition, a number of the objectives for the rate structures, although identified in relevant legislation (Clean Energy Act, UCA) and policy (Energy Plan), are not given clear priority or ranking. This can lead to competing objectives, because a rate structure designed to achieve one objective may compete with the achievement of another objective. As well, rate structures are not always proficient at supporting the achievement of the objectives. For example, some rate structures do not inherently support conservation, simplicity of billings or low rates to large families.

BC Hydro designs and BCUC approves the rate structures for each customer class. Although each rate structure is different, they all include Basic and Energy charges. The Basic charge, a flat daily rate, is aimed to cover customer care costs and does not depend on electricity consumption levels. The Energy charge, based on consumption levels is intended to cover all other costs within the customer class. Some rate structures (for classes with demand metering in place) also include a demand charge, which recovers the costs of building the transmission systems based on peak load requirements, using a tiered rate for kW demand. In addition, there is a Rate Rider charge applied to all customer classes, used to pay down BC Hydro’s deferral accounts.

The Residential rate structure is set on an inclining block (or stepped) basis whereby the customer pays a higher cost per unit for energy consumed above a certain threshold. The Small General service rate structure (for small businesses) is flat which results in the consumer paying the same rate, regardless of consumption levels. Neither of these rate classes has demand meters in place, so their rates do not include a demand charge element.

The Medium General and Large General Service rate structures are more complex. They include declining block structures, where the rate drops above a certain consumption level, and the introduction of an additional energy charge or credit that aims to encourage energy conservation. This model allows for an energy charge (at a higher rate) if consumption exceeds pre-determined levels, or an energy credit (reduction) may be applied if the energy consumption is lower than the customer’s normal level. This additional charge/credit mechanism is being phased in over three years for the Medium General Service class, so not all customers in that class are currently impacted.

Page 117 of 132 Keep, Keep searching for "Deferral"

 Regulatory/Deferral Accounts

There has been recent significant growth in BC Hydro’s net regulatory asset balance, and this growth will continue for several years, adding additional pressure and reduced flexibility to BC Hydro’s efforts to keep rates competitive while addressing new cost pressures. The future annual impact is not clear, as amortization policies are not always known, but the impact will likely be significant, and there is concern for future ratepayers
who are expected to cover these deferred costs, even in cases where the benefits were realized by current ratepayers.

BC Hydro operates in a rate regulated environment where, with BCUC’s approval, accounting policies allow the use of regulatory accounts to defer amounts for future recovery/refund. In the absence of rate-regulation, these amounts would be included in the net income when incurred and could result in volatile rate swings.

Deferred amounts are often large and/or unexpected income or expense due to factors beyond BC Hydro’s control (e.g., annual inflows into BC Hydro’s reservoirs), would cause BC Hydro’s rates and ROE to be unstable. The industry, in general, and regulators want stable rates for customers and returns to investors. To reduce rate fluctuations, BC Hydro is sometimes ordered by the BCUC, or given special direction from the province, to defer certain amounts. The deferred costs are recorded as regulatory assets, to be recovered from future ratepayers; deferred income is recorded as regulatory liability, to be refunded to future ratepayers. SNIP

Actually the expense is incurred by the BC Liberal Government to cover their asses in slopping bookkeeping methods.  Gordon and Christy have been spending way beyond their allowable limits.

"deferred costs are recorded as regulatory assets, to be recovered from FUTURE RATEPAYERS"

After Eleven years of the BC Liberals the FUTURE is here NOW.

Page 119 of 132  Search for   "Figure 3.5.1"  or copy and it paste it to here

Keep reading once you jump to page 118 and to the end of the line.

A picture is worth a thousand words, eh....2011, last year right, looks rosy, but by 2012 the reports from the Auditor General paints a totally different picture and the BC Liberals claim thing are just fine, its all under control without a whisper of admitting that they've been ripping BC Hydro's ratepayers off, and the rates are about to go sky high just so the BC Liberals can stay in power.   Think HST.  Think how much the public was told about the incoming HST, and then it was implemented for FOUR years.  Still don't get the picture, well here it is:

Page 123 and 124 Time of Use Rates

The benefits of having differential pricing (Time of Use rates) for peak and non-peak times is to encourage conservation. BC Hydro states on their website that this differential pricing may be considered after the completion of the current Integrated Resource Planning process. The planning process will determine if there is any need for Time of Use rates to meet BC Hydro's future capacity needs. If voluntary time of use rates are not implemented, a small amount of the savings estimated in the business case may not be realized, however even without time of use there would be positive payback, as theft detection and operational efficiencies makes up 93% of savings while time of use is only 7% of savings according to the business case.SNIP but keep reading to the bitter end!

Like this on page 126:  SMI  Smart Meter and Infrastructure

BC Hydro estimates that approximately 45% of the cost savings benefit to be derived from the SMI project will be from theft detection. This has been supported by independent research from the University of the Fraser Valley Center for Public Safety and Criminal Justice Research.  If these estimated benefits are realized over the long term, ratepayers will receive a return on their investment in SMI through lowered energy costs.
Smart Meter AND INFRASTRUCTURE!!!!!... the latter hasn't even begun to take place.

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