BC Hydro is less than totally transparent in a number of important areas. The BCUC could do more to ensure ratepayers’ interests are being protected.
Introduction
I recently used BC Hydro’s 2024/25 (F2025) annual report to show that its rates are probably set too low, and that this is storing up problems for the future.
In doing the research for that article, I came across several instances where the amount of information provided has declined over the years. Since BC Hydro is a public body, I find this lack of transparency…disturbing.
Three areas in particular stood out. While Just and Reasonable usually attempts to provide answers, all I can do here is pose questions. But there might be a theme that connects them.
1. What does BC Hydro spend on energy?
At first glance, the answer is straightforward: BC Hydro spent $2.86 billion on energy in F2025. However, this number is the “consolidated” figure, including the cost of energy for both BC Hydro’s domestic sales and its trading subsidiary, Powerex.
Until recently, the annual report provided the split between the cost of energy for domestic and trading sales. But suddenly, after F2023, that came to an end. The split up to F2023 is shown below:
Why not continue to include the domestic cost of energy in the annual report? Did something happen after F2023 that made releasing these numbers a problem?
2. Where has all the water gone?
Water is the fuel for hydroelectric generation. The amount of energy BC Hydro stores as water in its reservoirs determines whether it can meet customers’ needs throughout the year.
Annual reports used to provide the amount of energy stored in BC Hydro’s reservoirs, but that stopped in F2019:
Since then, we have only been given general comments such as “tracking above the ten-year historic average” (F2022) and “below the ten-year historic average” (F2023). Why did BC Hydro suddenly cease to publish these data?
Was it something to do with the consistent slide in storage levels from the high in F2015? Water inflows were only 87 percent of average in F2019, but that can’t be the whole story – in F2011 inflows were only 81 percent of average, described by BC Hydro as the “lowest in 51 years of record”, and yet reservoir levels in F2011 were higher than in F2019.
It’s interesting that BC Hydro was still actively selling “surplus” electricity in F2019, 2,230 gigawatt hours of it in fact, despite the low inflows and declining reservoir level.
3. How clean is BC Hydro’s energy?
One of BC Hydro’s corporate performance measures is its “100% Clean Electricity Standard”. The current annual report shows the following performance for the last three years, and all appears to be well:
Not exactly. In F2025, BC Hydro has stopped telling us its specific target and what it actually achieved, and instead is simply asking us to believe it has “met” the target. Not terribly transparent, and part of a trend that seems to obfuscate its achievements in this area.
Up to the F2022 annual report, BC Hydro’s clean energy target was to generate at least 93 percent of its electricity from clean or renewable resources. This target comes from objective (c) in section 2 of the Clean Energy Act, which BC Hydro is required to meet. BC Hydro duly reported on its performance against that standard, and comfortably exceeded it in F2021 and F2022 (by 5.0 and 4.4 percentage points respectively).
But the government has changed Clean Energy Act objective (c), making it harder to achieve. By 2030, not only must 100 percent of BC Hydro’s electricity be clean, but so must 100 percent of electricity “supplied to the integrated grid”, i.e. imports. This is the new standard for BC Hydro’s performance reporting.
But despite the objective now including imported electricity, BC Hydro’s annual report actually tells us less than it did before. We don’t even see how much of BC Hydro’s own generation is clean anymore, let alone how clean its imports are. All we see is the word “met,” which is totally inadequate.
This is a far cry from the F2011 annual report, which was the last one to report on BC Hydro’s actual greenhouse gas emissions (1.11 million tonnes of CO2 equivalent, since you asked).
Conclusion
Have you spotted a theme yet? It seems that BC Hydro is getting less and less keen for annual report readers to be able to distinguish between its domestic and trading activities.
But why should we care? Powerex, a non-regulated subsidiary, takes advantage of BC Hydro’s spare capacity, and its profits subsidize domestic rates (to the tune of $628 million in F2025). Is this not a good thing?
Yes, as long as BC Hydro’s domestic customers are not being overcharged to subsidize trading profits.
For example, what if BC Hydro were allocating its cheapest energy to Powerex to boost trading profits, while leaving domestic customers to pay for its most expensive energy?
Or, what if Powerex were using too much water from the reservoirs to maximize its export revenues, leaving the levels too low in times of drought and causing domestic customers to pay for imports?
The BC Utilities Commission (BCUC) should regulate to avoid this kind of behaviour, although the government has made it as difficult as possible. In 2021, during a hearing to review a new transfer pricing agreement between BC Hydro and Powerex, the government stepped in and directed the BCUC to approve the agreement. BC Hydro thus avoided having to answer 37 pages of questions from the BCUC, which was then not able to investigate whether the price Powerex pays for BC Hydro’s electricity is fair.
The BCUC could, however, take a closer look at BC Hydro’s reservoir management practices. The limited information in its recent annual reports suggests there might be issues here. At a minimum, the BCUC could insist that BC Hydro provide the information that used to be provided in its annual reports, and fill in the historical gaps.
As for BC Hydro’s claim to be achieving its “100% Clean Electricity Standard”, that isn’t so obviously in the BCUC’s jurisdiction. But when an environmental group recently complained that renewable natural gas might not be as clean as gas companies have suggested, the BCUC jumped on it and initiated an inquiry.
Will the BCUC do the same for BC Hydro’s inadequately supported claims of environmental stewardship?