Blog

New Bill Rebate Further Polticizes BC Hydro's Finances

By ordering the Utilities Commission to approve BC Hydro’s new rebate regulatory account the government continues to substitute political imperatives for the economic-based rate setting oversight provided by the once independent regulator.

 

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Finance Minister Confuses Expaination of Cost-of-Living Measures

Finance Minister Selina Robinson mixed fiscal years and conflated taxpayers and ratepayers in explaining the funding of new measures.

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Estimating the Cost of the Newly Announced BC Hydro Rebate

Premier Eby announced a credit/rebate but no total cost or funding plan was make public. This paper provides an estimate, and discusses two funding approaches.

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Accounting Rules Overstate Province's 2021/22 Revenue: On a Cash Basis the Surplus is Really a Deficit

National public sector accountig rules require that profits or losses from self-supporting Crown corporations be caunted as government revenue, even if no cash is transferred. The net income from BC Hydro and ICBC is not transferred and distorts the true cash picture of the government's finances.

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Plan to Collect Data and Report on Race Raises Questions

A commentary of the proposed Anti-Racism Data Act reviews a number of issues, including the presumption of systemic racism in provincial public bodies.

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Government Reneges on Promise to Allow BC Hydro's Regulator Full Independence

A new cabinet order negates the previous commitment to restore full independence to the BC Utilities Commission to regulate BC Hydro. Will the auditor general again qualify the government's financial statements?

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ICBC and BC Hydro Profits Distort Government Deficit

National accounting standards require that the net income of ICBC and BC Hydro be reported as government revenue. As no actual cash is transferred from thes two Crowns this distorts understates the size of the government's planned operating deficits for the current and next three years.

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Claims of Systemic Racism in Policing and Health Care: A Review of the Evidence.

The sponsors of two reports have claimed that the reports justify claims of systemic racism, but is this true?

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Providing BC Hydro's Regulator with Broader Discretion in Pricing Electricity is Highly Problematic.

Should the BC Utilities Commission be broadened to address social policy issues? This paper says this would be highly problematic.

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Manitoba Government Arbitrarily Raises Manitoba Hydro Rates by 2.5 Per Cent

The government of Manitoba has decided to increase Manitoba Hydro rates by 2.5% per year for the next three years. This has resulted in less transparency and accountibility.

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Government Blocks Possible Reduction in BC Hydro's Excessive Profits

A recent cabinet order has blocked any attempt by the BC Utilities Commission to lower BC Hydro's excessive profits. This is another example of the government's manipulation of the utility and the BC Utilities Commission.

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Manitoba Joins Quebec in Muzzling Hydro Regulator

The Manitoba government has sidelined the province's regulator of Manitoba Hydro, and legislated a 2.9% rate increase for the coming year. This action mirrors that of Quebec, which also "simplified" rate setting by eliminating the regulator for five years. Is there a trend?

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BC Utilities Commission Bankrolls New Intervener Group While Increasing Its Own Staff

In a new twist the BC Utilities Commission is creating and funding an intervener group to represent Residential ratepayers, at a time when its own analysticl staff has greatly ncreased. This paper reviews these developments, and suggests that the BCUC should improve its own accountability.

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Government Should Release the Half Year Results of BC Hydro and ICBC

The government has delayed the release of its second quarter financial report, including the reports for BC Hydro and ICBC. As the reports are for actual revenue and expenditure information the government should allow these public corporations to publicly file their reports.

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Another Perspective on the Government's Budget Surplus

Excluding the net income (or loss) from BC Hydro and ICBC from the government's revenue results in a significant difference in the budgeted and planned surpluses for 2020/21 and the next two years.

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Fact Check: ICBC Losses Have Not Displaced Spending on Other Programs

Finance Minister Carole James suggested that the losses at ICBC have displaced government spending on other programs. This is not correct.

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Should Ratepayers Subsidize the Electrification of Oil and Gas Production?

This Commentary reviews the government's assumption that B.C. Hydro ratepayers will subsidize the cost of electrifying the production of oil and gas in the noeth east reagion. It is a sudsidy because the cost is greater than the anticipated revenue. The social benefit of reduced carbon emissions should be paid by the government, not the ratepayers.

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Auditor General Removes Qualification on B.C. Hydro Accounting.

Auditor General Carol Bellringer has accepted the government's pledge to fully restore the B.C. Utilities Commission's authority to regulate B.C. Hydro and removed that part of her qualification on the government's 2018/19 financial statements.

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Ontario Legislative Committee Report Calls for More Transparency.

This Commentary reviews the recent report by the special committee of the Ontario legislature on financial transparency. The committee was struck to examine how the previous Liberal government ignored public sector accounting standards to lower electricity rates while still claiming to balance the 2017/18 budget.

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Government Extracts $70 Million from Hard-Pressed ICBC Policyholders.

This commentary explores how the government receives $70 million annually in driver license fees while ICBC's Basic policyholders must pay the cost as part of their annual insurance. The provincial fee scheme appears contrary to a 1998 Supreme Court of Canada decision respecting fees versus taxes. The government should correct this double payment.

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New B.C. Hydro Financing Plan and More Authority for the BCUC Announced.

This commentary reviews the new five-year rates plan for B.C. Hydro, as well as the government's plan to restore the B.C. Utilities Commission's authority to regulate the public utility.

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Government Requires Money-Losing ICBC to Fund More Traffic Enforcement

The government has directed ICBC to fund more traffic enforcement, but its more of a restoration. And why is the government not funding more police traffic enforcement instead of asking over-burdened policyholders to do it?

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Government Q2 Forecast Understates Cash Surplus

The inclusion of the net income of BC Hydro and the net loss of ICBC complicates the forecast of the surplus.

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Ontario Seeks to Improve Financial Transparency and Accountability.

A committee of the Ontario legislature is holding hearings into how the previous Liberal government attempted to ignore the accounting rules to make the government books appear than was the case. What lessons might the B.C. government learn from this review?

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Ontario Government Agrees that Hydro Deferral Accounting Inappropriate. September 21, 2018.

The Ontario government has moved to clean-up certain accounting practices, including the financing of the "Fair Hydro" deferrals. The accounting adjustment of the electricity deferrals increased 2018/19 expenditures by $2,4 billion.

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NDP Perpetuates Liberal Practices Regarding ICBC: Keeps Watchdog Confined. September 4, 2018.

This paper discusses the fact that the NDP government is using cabinet orders to control ICBC's finances and keep the B.C. Utilities Commission confined. These were the tactics used by the previous government to avoid public oversight.

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Goverment Begins Restoring Financial Integrity: What's Next for B.C. Hydro's Books? August 31, 2018

This paper provides an overview of why the government set aside $950 million for the 2017/18 fiscal year to begin to fix the financial troubles at B.C. Hydro. the restoration of proper accounting standards at the public power utility presents certain financial problems for the government.

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Commentary: Populist Promises and the Cost of Electrictiy. May 18, 2018

The three main politic parties in Ontario are promising to reduce electricity prices, but are being vague as to what this will cost. It's time for the voters to become educated consumers. 

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Commentary on Matthew McClearn Article on Hydro Accounting in Ontario. April 22, 2018.

McClearn's article in the Globe and Mail provides a useful summary of many of the issues involved in the accounting dispute between the ontario auditor general and the government. Similar issues exist in British Columbia.

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Inappropriate Regulatory Accounting: Ontario and BC Discussion of Auditors' Opposition. March 30, 2018

This 'Commentary' paper reviews the Ontario and BC public accounts committee discussion of the oppositin by the two auditors general of the application of reguatory accounting, and the impact to the governments' financial statements.

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BC Utilities Commission Independence: Is the Government Listening? March 16, 2018.

Auditor General Carol Bellringer issued a report, http://www.bcauditor.com/sites/default/files/publications/reports/FINAL_BCUC.pdf, that reminds the government that five key recommendations of the 2014 independent task force remain outstanding. In August Ms. Bellringer qualified the government's 2016/17 financial statements, in part because BC Hydro's deferral accounts were not overseen by an independent regulator. The Canadian Press provided a limited summary (http://vancouversun.com/pmn/news-pmn/canada-news-pmn/b-c-auditor-offers-advice-on-utilities-commission-after-previous-studies/wcm/c65203d2-1811-4418-ab5b-f55f3002d5d7. DeSmog Canada's report was more comprehensive; https://www.desmog.ca/2018/03/15/auditor-general-nudges-b-c-amend-act-exempted-site-c-dam-independent-review

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Accounting Treatment of ICBC's Net Loss Complicates Provincial Budget. February 17, 2018.

The national public sector accounting rules require that ICBC's net income or loss be counted in the government's revenue. The increase in the net loss reduces revenue, but there is no change in the actual cash being transferred (which is nil). This accounting anomoly requires further review.

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Alberta Caps Auto Insurance Increase at 5 Percent. December 19, 2017.

The Alberta government has limited the 2017/18 increase in the private vehicle insurance rates to 5%. It stated that the previously allowed 10% maximum increase was not inline with its affordability priority. Background and implications are provided. 

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Email to Auditor General Bellringer re BC Hydro Accounting, December 2, 2016.

This email informs Auditor General Bellringer of recent developments respecting BC Hydro's accounting for future unbilled and uncollected revenue.

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Fact Check - Government Admits Major Rate Increases Coming for BC Hydro and ICBC. April 20, 2017.

On April 19th finance minister de Jong stated that the coming four-year rate increase requirement for BC Hydro is 28%, and close to 70% for ICBC's Basic program. The government's rate suppression policy has postponed the financial reckoning.

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ICBC Deficits-Question Period February 22, 2017. February 26, 2017.

Minister Stone attempts to defend ICBC's deficit forecasts during Question Period on February 22, 2017.

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Understanding Regulation in the United Kingdom 2016. December 18, 2016.

Martin Stanley's compendium of issues relating to regulation of public utilities in the UK; http://www.regulation.org.uk/

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