Drought withered B.C. Hydro’s revenues by $1 billion by end of its third quarter

Kinbasket Lak
The level of Kinbasket Lake, which is the reservoir behind B.C. Hydro’s Mica Dam is now three metres below normal. Photo by CarrieColePhotography /Getty Images
B.C. Hydro’s drought-withered financial results show the utility took in $1 billion less revenue over the first nine months of its fiscal year than for the same period a year ago.
Water flows into key reservoirs “were significantly below average” and were lower than the same period a year earlier, Hydro said in its latest quarterly report released late Wednesday.
Revenue was $5.4 billion up to Dec. 31, compared with $6.5 billion for the same period of Hydro’s previous fiscal year, which was due mostly to an $828 million drop in electricity exports due to the drought. The results would have left B.C. Hydro with a $178 million loss, according to the results, but the utility made a $522 million transfer from regulatory accounts that it uses to smooth out potential rate shocks from short-term events, and posted profit of $344 million. That transfer, however, does increase B.C. Hydro’s long-term debt.
Conditions don’t look a lot better for 2024 either with water storage in its reservoirs, “tracking below the 10-year average due to below average inflows,” in the second half of its fiscal 2023 and into the start of 2024. “System energy storage at Dec. 31, 2023 was lower than at Dec. 31, 2022,” according to the report. Earlier this month, Hydro reported that the water level in its Kinbasket reservoir in the Kootenays was three metres lower than normal for February. The level in the Williston reservoir in the northeast that drives its Peace River dams was 1.6 metres below normal with the region still in a Level 5 drought. CEO Chris O’Riley told Postmedia that their forecasts do suggest better reservoir levels by the end of March, but said the utility is also preparing to continue importing of electricity in 2024, though the amount will depend on how much more snowpack builds during the rest of winter.
While the utility’s financial results remain under pressure due to drought, the provincial government has also ordered B.C. Hydro to return $370 million to ratepayers as an average $100-per-customer B.C. electricity affordability credit on their bills.

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