COPE 378's Provincial Budget Response

With the release of the Provincial Government's Budget on Tuesday, February 19, COPE 378 has worked to strip off the "Green Veneer" of the Budget, and dilute some of the government's hurculean spin efforts.

President Andy Ross, Vice President Gwenne Farrell, and Director of Communications Mike Bruce all attended the pre-budget lockup on Tuesday. The lockup is intended to give provincial stakeholders an advance look at the budget in order to prepare their responses for the media. While provided with advance access, stakeholders are sequestered in a locked environment and have to surrender all cell phones and electronic communication devices.

COPE 378's response focussed on the government's drastic hike in Hydro rates, which union analysis identifies as 24% over three years, and the fact that the primary reason for these hikes is the government's expensive and irrational dedication to privately produced power.

“If we weren’t paying these subsidies to IPPs, we would have more than enough provincial revenue to cover an aggressive climate change strategy, while sparing British Columbians these drastic rate increases,” said Ross.

Please see below for the press release issued by COPE 378 in response to the Budget.

FOR IMMEDIATE RELEASE

BC BUDGET SHOWS HYDRO RATE HIKE OF 24% OVER 3 YEARS
Subsidies to expensive, inefficient private power drive punitive rate increase:
BC Hydro Union
February 19, 2008

Victoria, BC – The BC Budget clearly shows that Hydro customers in BC will see a rate hike of at least 24% over the next three years in order to pay for the government’s determination to purchase power from inefficient Independent Power Producers (IPPs), according to budget analysis done by the Canadian Office and Professional Employees Union Local 378 (COPE 378), which represents workers at BC Hydro and throughout the BC energy sector.

“This rate hike amounts to a punitive tax on BC Hydro customers across the province, and for what?” asked Andy Ross, President of COPE 378. “The only reason that the government is forcing this hike is to cover the exorbitant costs of uneconomical, inefficient, and environmentally destructive private power projects,” added Ross.

“Most British Columbians are going to need to put their $100 Climate Action Tax Credit towards one of their monthly Hydro bill,” said Ross.

To date the provincial government has claimed that rate increases are intended to pay for infrastructure improvements, but the budget makes it clear that it is primarily the cost of private power driving this increase.

The budget states on page 70 that the primary driver of these costs is the high cost of IPP power supply. The BC Hydro Service Plan likewise identifies the high cost of private power as the main cost driver.

Page 192 of the 2008/09 shows a total rate increase of 24% (compounded) by 2011. This includes 6.56% in 2008/09, 8.21% in 2009/10, and 6.52% in 2010/11, plus a .5% rider each year, which equals 24% when compounded.

“Our research shows that the total cost of private power is at least $5 billion per year, from direct and indirect subsidies and lost revenue due to no royalties,” said Ross.

“If we weren’t paying these subsidies to IPPs, we would have more than enough provincial revenue to cover an aggressive climate change strategy, while sparing British Columbians these drastic rate increases,” added Ross.