The Canadian province of British Columbia (BC) has long enjoyed some of the lowest electricity costs in North America, but the market appears set to change. In August 2013, a draft of the BC Rates Plan was leaked, and the plan proposed a 26% rate increase by 2016. Unlike Alberta, its deregulated neighbor, BC’s power sector is a regulated environment dominated by BC Hydro, a crown-corporation accounting for 80% of the province’s generation capacity.

Over the last two years, the Liberal government and BC Hydro have worked together to plan BC’s energy future as the province’s demand for electricity is expected to rise by 40% over the next 20 years. The culmination of this work was announced at the end of 2013: the government’s 10-Year Plan and BC Hydro’s complementary Integrated Resource Plan (IRP), which called for extensive new investments and upgrades to infrastructure but simultaneously sought to stem the inevitable tide of rate increases for customers. BC Hydro plans to spend C$1.7 billion per year over the next 10 years on capital improvements, while rates are expected to rise by 28% by 2019.

The plans fail, however, to clarify two very important issues: the upcoming final decision for whether BC Hydro’s Site C, a long-proposed 1,100-megawatts (MW) project on the Peace River, is approved, as well as the development of substantial gas reserves through the construction of electricity-intensive LNG export facilities. Site C, if approved, would add 1,100 MW of generation capacity and likely crowd out the need for independent power producers (IPPs). However, in the event Site C is not approved or severely delayed, IPPs will have an unprecedented opportunity to fill the void.