Hansard excerpts, Adrian Dix ineffectually “questioning” Bill Bennett re. extortion fees, the amounts, not the fact that they are extortion. Bennett is allowed to obfuscate and mislead, e.g. the cost estimates given to BCUC said that the more people who opted out, the cheaper it would be per household. Now Bennett is saying the opposite.
APRIL 21, 2015 Full version:
http://www.leg.bc.ca/hansard/40th4th/20150421pm-CommitteeA-Blues.htm
A. Dix: I didn’t want to disappoint the minister, so I was going to ask him a little bit about the smart meter program. In particular, maybe just to start the discussion….
Just for the record: the number of people using the radio-off smart meter, the number of people using the meter choices or maintaining their legacy meter in some fashion, and the number of people using a smart meter, which I think is the largest of the three numbers.
Hon. B. Bennett: The smart meter program — 1.9 million customers are smart. That is more than 99 percent. So 14,732 customers have elected to keep the old meter, and of those customers, 950 are refusing to allow their expired old meter to be replaced.
When I took this job, I became aware of an organization known as Measurement Canada, which I’m sure the member, having been around longer than I, is well aware of. I had never heard of it, but they apparently go around the country making sure that all the instruments that measure things are reliable and are not timed out. That’s the case with electricity meters. There are 950 people that want to keep their arms wrapped around those meters, even though, according to Measurement Canada, they should be replaced.
There are 555 customers, I’m advised, who have requested a radio-off meter — a digital meter with the radio turned off. And 363 existing smart meters need to be replaced with a new smart meter, but the customer is refusing. So that’s a normal situation where you’ve got a meter that has malfunctioned for one reason or another. It’s a smart meter, and the customer doesn’t want it replaced.
A. Dix: In its application to the BCUC around the meter choices program, B.C. Hydro put forward, as a model, 5,000 legacy meters against 5,000 radio-off smart meters. If you remember the calculation, obviously, that produces significantly less revenue than the current model. Has that changed the assumptions at B.C. Hydro around what it should be charging customers in the program?
Hon. B. Bennett: As I read out a second ago, there are 14,732 customers who have elected to keep the old meter. The estimated cost of these outliers, originally, was based on 10,000 customers, so you’ve got roughly 5,000 customers right now refusing to take the smart meter — more than what Hydro’s numbers were based on.
You’ve actually got an additional cost to Hydro, so they’re not recovering their full costs and won’t recover their full costs until it gets down to 10,000 customers, which they anticipate achieving some time in 2016. At that point, I’m advised, there’s no plan to go to the BCUC and change the cost of keeping the legacy meter.
A. Dix: Well, that was close to the question. It was near the question. It was around the question. But it wasn’t an answer to the question.
The question was on the 10,000 the minister referred to, or 5,000 legacy meter customers paying $32.40 a month and 5,000 radio-off smart-meter customers paying $20 a month. One is more than the other, when the balance is 14,500 to 500. Right?
That changes the financial basis of the program. It’s actually more revenue than was expected by B.C. Hydro under the program, dramatically more. And since B.C. Hydro is charging six times more for this program than other utilities, that’s a significant amount of revenue, entirely paid for by these customers of B.C. Hydro.
I guess I’m asking…. Clearly, B.C. Hydro was incorrect in its analysis, and there’s no problem with that. It’s the customer that decided this, not B.C. Hydro — which would be in which program. But has the different balance — not 5,000 to 5,000 but 14,500 to 500 — changed the revenue that B.C. Hydro receives? Has it changed any of the financials for the program?
Hon. B. Bennett: I think I have it this time. I think the member wants to know whether the fact that there are only 555 customers with radio-off meters out there created a situation where B.C. Hydro hasn’t actually had to invest as much because those are digital meters. If you had more of them out there, you’d spend more money, versus the 14,732 customers that just elected to keep their old meters. So the ratio between the number of customers who have kept their old meters and the number of customers who took radio-off meters is different than what was contained in the proposal taken to the BCUC.
Am I on the right track, hon. Member?
A. Dix: I think I might explain and then move on to the next question — and maybe get two questions in one. I think that’s in the interests of efficiency.
Someone with a legacy meter pays $144 a year more than someone without one — right? — so when you’ve got way more people with legacy meters, there’s way more money to B.C. Hydro out of the program. That’s the difference.
Maybe I can add to that a question about those fees — $32.40 for one program and $20 a month for the other. Can the minister explain why the fees are so much higher in British Columbia? I mean, I know he referred to the 1.9 million customers who took the government’s meter in as smart and the others as something else, but they’re customers of B.C. Hydro, nonetheless.
Why, in British Columbia…? Well, not in British Columbia. Let’s be clear. In the case of the Fortis program, it’s also twice as high. Why is B.C. Hydro charging these customers so much when what’s happened out there causes an enormous amount of division for those customers and for B.C. Hydro employees who have to implement the government’s policies?
Hon. B. Bennett: I think it’s important to note that B.C. has not had anywhere close to the same level of issues around the smart meter program that they’ve had in other jurisdictions in North America. But the real answer to the member’s question is that Hydro put together a proposal for the BCUC that was based on recovering the costs of having these outliers.
When you think about how a utility operates, a utility needs to be able to measure the electricity used by the consumer. They do that with meters. Meters are placed on, or very close to, where people live, their businesses, etc. That has been the same since, you know, electricity was invented.
I think that Hydro and the government were reasonable in considering allowing people to either keep their old meter or to take a meter with the radio turned off. There’s absolutely no scientific evidence to suggest that there’s any health hazard to people, but people wanted to keep their old meters, and so we allowed that. But what we didn’t allow was for other ratepayers who have taken smart meters — 1.9 million of them — to subsidize the cost of these outliers.
Other provinces have done their calculations on the basis of different approaches. For example, in Quebec they charge for the meter reading. They didn’t charge for all the other costs associated with being an outlier. It is our belief that ratepayers, generally, should not subsidize other ratepayers except under very unusual circumstances. And this is not that kind of circumstance, where somebody just doesn’t want to have a smart meter. It’s not a reason for another ratepayer to subsidize the costs of that person doing that, making that choice.
A. Dix: Specifically, on radio-off smart meters, for example, why does B.C. Hydro charge twice as much as Fortis. They’re also a utility where they’re operating that thing. Why do they charge twice as much as Fortis? Why do they charge six times as much as Hydro-Québec?
I’ll be specific, if the minister would like. Prior to the putting in place of the smart meter program — all kinds of promises were made about what it would do, many of which have withdrawn — what the government had, as I understand it, was 20 check meters across the province, 1.9 million customers and 20 check meters. Now what was expected to be 5,000 legacy-meter customers are paying for a system, as I understand B.C. Hydro’s application, of 200 check meters. So 1.9 million; 2,500, which was the basis on which the application was made, 200. And this cost alone, the so-called security cost, is $12 a month — or more than, for the legacy-meter customers, the cost of the entire legacy program in other provinces.
Perhaps the minister can explain the justification for what appears to be a loading up of costs on these customers, which is costing Hydro lots of goodwill and lots of challenges. It seems to me punitive. The purpose of the program, I presume, is that people pay for what Hydro now has as an additional service. It’s not to punish those customers, especially in the context of 28 percent rate increases.
Hon. B. Bennett: I think it’s ironic that an hour ago the member and other members from the opposition were all for the BCUC to be involved in everything. “Let the BCUC look at it. Let’s take it to the BCUC. That’s the answer to all our problems.”
But now Hydro took this formula to the BCUC. They did what the members said they wanted. They took this to the BCUC, and the BCUC said that these rates that are being charged to these outliers are fair because they’re not subsidized by the other ratepayers.
Now, Fortis decided they were going to let their ratepayers subsidize the cost of having outliers in their system. That’s up to Fortis. They’re a private utility serving the public. That was their application. That was their choice.
B.C. Hydro has a bigger system. They’ve got, as I’ve already said, 1.9 million customers who have taken the smart meter. Why should those people subsidize those who simply don’t want to take a smart meter? The NDP position is that those 1.9 million people who have taken a smart meter should pay extra so that somebody down the street can keep their old meter.
A. Dix: The NDP position is that the minister should stop overcharging these customers. That’s the NDP position. I mean, one is occasionally surprised, and one shouldn’t be surprised when a government that made this decision, rushed to this decision, and had a preferred supplier for a $900 million program, exempted itself by cabinet order.
I’m not sure if that was in one of the periods when the minister was in cabinet or not in cabinet. I guess we could check that. There was a period of absence there.
They made the decision to exempt this program from the BCUC. And then to hear the minister, after the government sends an order to the BCUC and restricts the BCUC, which also approves Fortis, on the question of the legacy meter program. He says: “Oh, we wanted the smart meter program to go to the BCUC, except for the $900 million investment.” It’s an interesting approach. It’s an interesting and significant approach. Boy, you wrestled that budget to the ceiling.
My question was precise. To the minister, why does he need 200 check meters for 5,000 customers when he only had 20 before for 1.9 million?
Hon. B. Bennett: The minister doesn’t need 20, 40, 60, 80, 100. It’s got nothing to do with the minister.
The utility took this to the BCUC. The BCUC said, with some adjustments: “This is how much you should charge outliers who refuse to take a smart meter. If they want a radio-off meter, this is what you charge them. If they want to keep their old legacy meter, their 1950s technology, this is what you charge them.” The BCUC said that that is a correct, fair price.
I had nothing to do with the calculations done by B.C. Hydro, and I had nothing to do with the BCUC’s view that what B.C. Hydro was proposing was correct and fair.
A. Dix: Well, the minister had nothing to do with it except that he was a member — I think he was a member — of the cabinet that exempted the smart meter program from BCUC review. That’s nothing. “That’s nothing,” he says. He took the order, the referral, to cabinet, as minister, on this question, which limited the scope of the hearings as everybody knows who took part in those hearings and reviewed those hearings — which I have, as you know, done.
So the minister…. I guess I can ask him again. It’s a very simple question. These customers are paying for it. It’s $12, the amount, for security. Why do they have ten times as many check meters for less than 1 percent the number of customers?
Hon. B. Bennett: Check meters provide the ability to detect theft where there are legacy meters. More check meters are required to detect that theft. That’s a pretty straightforward answer. The cost of the additional check meters is entirely attributable to those customers with legacy meters.
Once again, as I have been saying, the outliers and the cost of those outliers must be borne by those outliers, not by other ratepayers. That’s only fair.
A. Dix: The cost of the 20 check meters before was borne by those customers that had legacy meters, who are, presumably, 1.9 million. Now the cost of ten times that amount is borne by, according to this process, 5,000. There are more customers than that, but one hesitates to ask how much theft the check meters have detected. I won’t do that now because we’re approaching the end.
I did want to ask about the relationship between Hydro customers who are being cut off and B.C. Hydro. My colleague from Kootenay West has an example of a Mr. Craig Petitt, who had his hydro cut off without written notice, a telephone call or a knock on the door. We heard different messages from different people at B.C. Hydro last winter as to whether people would be cut off if they were overdue based on a refusal to pay for the smart meter program or the additional fees in the smart meter program.
One spokesperson at B.C. Hydro suggested they weren’t cutting people off in the winter, which sent a message to one group of people, but at the same time, B.C. Hydro was cutting people off in the winter. I guess my question is, given the statements by B.C. Hydro spokespeople: what is the position? Is it the position of B.C. Hydro that they will cut people off during the winter or not?
Hon. B. Bennett: B.C. Hydro really has no way of knowing why people don’t pay their bills. Most people do. The vast majority of people do. Probably all 1.9 million of those who took the smart meters do, but I’m guessing.
In any case, if they don’t pay their bill, there’s a period of time where Hydro will ask for payment. After that period of time expires, the matter is taken into a collections process, and the collections authority attempts to collect from the ratepayer. If they’re not able to do that or to make arrangements that are satisfactory to the utility for payment, then there is a disconnection that happens.
It can happen at any time of the year, except that there is a special consideration given by Hydro for extreme cold weather. I don’t have a temperature, but anything that is dangerously cold…. I’m advised that Hydro would not do a disconnection at that time. But generally, those disconnections can take place throughout the course of the year.
A. Dix: Interestingly, the estimates end at four o’clock, so the minister is about to move a motion. As Ernie Banks would say, I would very much like to “play two.” But we’re not going to do that today. We’re going to move on to the estimates of the Ministry of Transportation. I understand they need to be referred in the other House, so we’ll be adjourning in a moment.
I wanted to thank the minister and the staff of B.C. Hydro, and the staff of the Ministry of Energy who have joined us here today. With that, I’ll leave it to the minister to move the appropriate motion.
The Chair: Actually, there are no motions, but hearing no further questions, I will now call Vote 20.
Vote 20: ministry operations, $25,524,000 — approved.
The Chair: We’ll call a short recess as we get ready for the next session.
The committee recessed from 3:59 p.m. to 4:05 p.m.
[M. Morris in the chair.]
