Canadian Utility That Helped Keep Lights On Awaits Back Pay
Call it the NAFTA grid. Power buys from Baja California in Mexico have helped keep the lights on in Orange County and the rest of the Golden State. So too have purchases from the country’s other North American Free Trade Agreement partner,the one to the north.
Vancouver, British Columbia-based BC Hydro Corp. has been an unsung source of energy for California, providing about $1 billion in electricity from January to May this year,more than 2 million megawatt hours in all.
But now, like other power providers, BC Hydro says it is waiting to see how it’ll be paid back for what it says is hundreds of millions of dollars owed for electricity bought last year by Southern California Edison and Pacific Gas & Electric.
But BC Hydro isn’t turning off the power. The utility, owned by the British Columbia government, sells electricity through PowerEx, a BC Hydro arm that sells and buys electricity.
“California has been a very highly valued customer of ours for many years,” said BC Hydro spokesman Wayne Cousins.
But lately, California’s need for power from BC Hydro hasn’t been as dire. Since January, California’s Department of Water Resources took over control of buying electricity generated out-of-state from the Folsom-based California Independent System Operator.
Since then, most of the department’s purchases have been through long-term contracts signed earlier in the year to reduce dependency on the electricity spot market. And lately, the department has been a seller of power on the open market, thanks to conservation spurred in part by higher power bills.
As a result of long-term contracts, though, the state lost $46 million selling extra power in July after relatively mild temperatures cut demand.
Power that the department buys from out-of-state entities, including PowerEx, gets spread out among the state’s three investor-owned utilities,Rosemead-based Southern California Edison, San Francisco-based Pacific Gas & Electric and San Diego Gas & Electric,depending on their needs.
“We try to work against a net short (of power),” said the department’s acting deputy director Peter Garris. “So we procure as much energy as we can by filling the net short on contract purchases and generation and then distribute it on a best-bid basis to the utilities.”
But California’s reduced demand for out-of-state power could be a good thing. While BC Hydro often generates a surplus of electricity and boasts some of the lowest electricity rates in North America, its supply is not limitless these days. This year, British Columbia and the rest of the Pacific Northwest are dealing with low water levels because of less rain and snowfall last winter.
“So we’re keeping a close eye on water levels and our ability to help out with anyone outside the province,” Cousins said.
British Columbia, Alberta and a dozen U.S. states and parts of northern Mexico, including Baja California, are part of single regional grid coordinated by the Salt Lake City, Utah-based Western Systems Coordinating Council. n
